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Author: 


Commons,  John  Rogers 


Title: 


Trade  unionism  and  labor 
problems 

Place: 

Boston 

Date: 

[1921] 


MASTER    NEGATIVE    # 


COLUMBIA  UNIVERSITY  LIBRARIES 
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BIBLIOGRAPHIC  MICROFORM  TARGET 


ORIGINAL  MATERIAL  AS  FILMED  -     EXISTING  BIBLIOGRAPHIC  RECORD 


C737? 


Commons,  John  Rogers,  1862-       ed. 

Trade  unionism  and  labor  problems ;  2d  series,  ed.  with 
an  introdnction,  by  John  R.  Commons  ...  Boston,  New 
York  [etc.]  Ginn  and  company  ['=1921] 

xiii,  838  p.    21i^'".     (Half-title:  Selections  and  documents  in  economics, 
ed.  by  W.  Z.  Ripley) 

Contents.— I.    Security.— li.    The    labor   market.— ni.    L^bor   manage- 
ment.— IV.  Labor  unions. — V.  The  law. 


l._Labor  and   laboring  classes.    2.  Labor  and  laboring  classes— U.  S. 
3.  Trade-unions.        i.  Title. 


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SELECTIONS   AND   DOCUMENTS 
IN    ECONOMICS 


EDITED    BY 


WILLIAM    Z.   RIPLEY,    Ph.D. 

Professor  of  Economics,  Harvard  Univbrsitv 


SELECTIONS  AND  DOCUMENTS 
IN  ECONOMICS 

SELECTED  READINGS  IN  ECONOMICS 
By  Charies  J.   Bullock,  Ph.D.,  Professor  of 
Economics,  Harvard  University 

SELECTED  READINGS  IN  PUBLIC 
FINANCE  {Second  Edition) 
By  Charles  J.  Bullock,   Ph.  D.,  Professor  of 
Economics,  Harvard  University 

ECONOMIC  HISTORT  OF   THE   UNITED 
STATES.   176J-/S60 

By  Guy  Stevens  Callender,  late  Professor  of 
Political  Economy,  Yale  University 

SOCIOLOGY  AND  SOCIAL  PROGRESS 

By  Thomas  N.  Carver,  Ph.  D.,  Professor  of 
Political  Economy,  Harvard  University 

TRADE  UNIONISM  AND  LABOR 
PROBLEMS  {Second  Series) 
By  John  R.  Commons,  Professor  of  Political 
Economy,  University  of  Wbconsin 

SOCIAL  PROBLEMS  AND  SOCIAL 
POLICY 

By  James  Ford,   Ph.D.,  Associate  Professor 
of  Social  Ethics,   Harvard  University 

RAILfVAT  PROBLEMS  (Re-vised  Edition) 

By  William  Z.  Ripley,  Ph.D.,   Professor  of 
Political  Economy,  Harvard  University 

TRUSTS,   POOLS  AND  CORPORATIONS 
{Revised  Edition) 

By  William  Z.   Ripley,   Ph.D.,  Professor  of 
Political  Economy,   Harvard  University 

SELECTED  READINGS  IN  INTERNA- 
TIONAL  TRADE  AND   TARIFF 
PROBLEMS 

By  Frank  W.  Taussig,  Henry  Lee  Professor 
of  Economics,  Harvard  University 

READINGS  IN  SOCIAL  PROBLEMS 

By  Albert  Benedict  Wolfe,  Professor  of  Eco- 
nomics, University  of  Texas 


vi 


TRADE  UNIONISM  AND 
LABOR  PROBLEMS 


SECOND  SERIES 


EDITED 

WITH  AN  INTRODUCTION 

BY 

JOHN  R.  COMMONS 

PROFESSOR   OF   ECONOMICS.  UNIVERSITY   OF   WISCONSIN 


«  i  ■ 


^^  AtCD 


GINN  AND  COMPANY 

BOSTON     .     NEW   YORK     •     CHICAGO     •     LONDON 
ATLANTA     •     DALLAS     •     COLUMBUS     •     SAN    FRANCISCO 


■^■1 


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V 


COPYRIGHT,  iy21,  BY 
JOHN  R.  COMMONS 


ALL    KlGHTif,    I^S&F^RVEI? 
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PREFACE 

This  book  is  a  new  edition,  not  a  revised  edition,  of  "Trade 
<  Unionism  and  Labor  Problems,"  published  in  1905.  As  before,  the 
(\  book  is  planned  for  use  not  only  as  a  collection  of  reprints  but  also 
as  a  textbook.  It  provides  raw  material,  theory,  and  discussion.  It 
draws  upon  men  of  affairs  and  students.  It  is  intended  to  give 
concrete  cases  and  generalizations.  The  Introduction  and  Index  are 
intended  to  bring  together  from  all  these  cases  the  items  on  which 
generalizations  may  be  made. 

I  have  again  had  the  valued  help  of  Professor  Ripley,  editor  of  the 
series.  The  liberality  of  the  several  authors,  editors,  and  publishers 
in  permitting  this  reproduction  of  their  work  is  sincerely  acknowl- 
edged, as  well  as  the  help  of  assistants  in  the  Department  of  Eco- 
nomics of  the  University  of  Wisconsin — Mr.  Olin  Ingraham,  Mr.  O. 
F.  Carpenter,  and  Miss  Miriam  Gaylord — who  have  made  wide 
searches  for  me. 

JOHN  R.  COMMONS 

University  of  Wisconsin 


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CI  311 

TCbc   iStftcmtum   grcg< 

GINN  AND   COMTANY  •  FRO- 
PRIETORS  •  BOSTON  •  U.S.A. 


/■ 


CONTENTS 

PAGE 

Introduction.   By  John  R.  Commons ix 

PART  I.    SECURITY 

CHAPTER 

I.  Industrial  Relations.    By  John  R.  Commons i 

II.  American    Experience   with   Workmen's    Compensation.     By 

Willard  C.  Fisher 1 7 

III.  Compulsory  Health  Insurance  in  Great  Britain.    By  Olga  S. 

Halsey 45 

IV.  The  British  National  System  of  Unemployment  Insurance  — 

Its  Operation  and  Effects.    By  Olga  S.  Halsey 56 

V.  Trade-Union  Sickness  Insurance.    By  James  M.  Lynch  ...       71 
VI.  Health  Programs.    By  John  R.  Commons 81 

PART  II.    THE  LABOR  MARKET 

VI 1.  Autobiographies  of  Floating  Laborers.    By  P.  W.  Speek     .     .  94 

VI 11.  The  Men  we  Lodge.    By  Robert  B.  Brown 104 

IX.  Interstate  Migration  of  Negro  Population.    By  W.  O.  Scroggs  1 1 5 

X.  A  Clearing  House  for  Labor.    By  Don  D.  Lescohier  ....  125 

PART  III.    LABOR  MANAGEMENT 

XI.  Scientific  Shop  Management.  By  F.  W.  Taylor  and  N.  P.  Alifas     141 
XII.  The  Problem  of  Labor  Turnover.    By  Paul  H.  Douglas.     .     .     150 

XIII.  Personal  Relationship  as  a  Basis  of  Scientific  Management.    By 

Richard  A.  Feiss 165 

XIV.  Scientific  Management  and  Dictatorship  of  the  Proletariat.    By 

Nikolai  Lenin i79 

XV.  Premium  and  Bonus  Systems  of  Payment.    By  D.  A.  McCabe  199 

XVI.   Protection  of  Piece  Rate.    By  Charles  W.  Mixter 205- 

XVII.  Nonfinancial  Incentives.    By  Robert  B.  Wolf 218 

XVIII.  Apprenticeship  in  the  Metal  Trades.    By  M.  W.  Alexander.     .  233 

XIX.  Profit-Sharing  in  the  United  States.    By  Boris  Emmet    ...  249 
XX.  Profit-Sharing  in  the  Baker  Manufacturing  Company.    By  John 

S.  Baker 263 

XXI.  A  Plan  for  Collective  Bargaining  and  Cooperative  Welfare. 

Philadelphia  Rapid  Transit  Company 270 

vu 


i 


viii         TRADE  UNIOiNISM  AND  LABOR  PROBLEMS 

CHAPTER  PAGE 

XXIL  Workshop  Committees.    By  C.  G.  Renold 288 

XXIII.  Labor  Administration  in  the  Shipbuilding  Industry  during 

War  Time.    By  Paul  H.  Douglas  and  F.  E.  Wolfe     .  311 

PART  IV.    LABOR  UNIONS 

XXIV.  Trade-Unions  versus  Shop  Committees.    American  Federa- 
tion of  Labor 345 

XXV.  Tendencies  in  Trade-Union  Development.    By  G.  M.  Janes     349 
XXVI.  Amalgamation  of  Related  Trades  in  American  Unions.    By 

T.  W.  Glocker 3^^- 

XXVII.  The  Dominance  of  the  National  Union  in  American  Labor 

Organization.    By  George  E.  Barnett 386 

XXVIII.  The  National  Founders'  Association.  By  Margaret  L.  Stecker     406 
XXIX.  The  Founders,  the  Molders,  and  the  Molding  Machine.   By 

Margaret  L.  Stecker 433 

XXX.  Collective   Bargaining  in  the    Glass-Bottle    Industry.     By 

Leo  Wolman 45^ 

XXXI.  The  San  Francisco  Building  Trades.    By  Ira  B.  Cross  .     .     477 
XXXII.  Patternmakers' Local  Agreements,  Chicago.  By  F.  S.  Deibler     489 

XXXIII.  The    Settlement   of    Disputes    under   Agreements   in    the 

Anthracite  Industry.    By  Edgar  Sydenstricker  ....     495 

XXXIV.  Equalizing  Competitive  Conditions.    By  Ethelbert  Stewart     525  - 
XXXV.  The  Hart  Schaffner  &  Marx  Labor  Agreement     ....     534 

XXXVI.  American  Federation  of  Labor  Reconstruction  Program      .     562 

PART  V.    THE  LAW 

XXXVII.  Liberty  of  Contract.    By  Roscoe  Pound 579 

XXXVIII.  Hours  of  Labor  and  Realism  in  Constitutional  Law.    By 

Felix  Frankfurter 614 

XXXIX.  Collective    Bargaining    before    the    Supreme    Court.      By 

Thomas  R.  I'owell 635 

XL.  A  New  Province  for  Law  and  Order.   By  Henry  B.  Higgins     667 
XLI.  Wage    Theories    in    Industrial    Arbitration.      By    Wilson 

Compton 694 

XLI  I.  Minimum  Wages  for  Women.    By  F.  W.  Taussig     .     .     .     7M 
XLIII.  American   Minimum- Wage  Laws   at   Work.    By  Dorothy 

W.  Douglas 738 

XLIV.  Operation  of  the  Industrial  Disputes  Investigation  Act  of 

Canada.    By  Benjamin  M.  Squires 779 

XLV.  Eight-Hour  Shifts  by  Law.    By  John  R.  Commons   ...     807 

Index ^25 


INTRODUCTION 

Fifteen  years  ago  Insurance  and  Unemployment  were  placed  last, 
now  they  are  placed  first,  in  this  book.  Western  civilization  is  built 
upon  security  of  investments,  and  it  is  the  insecurity  of  labor  that 
menaces  it  (Chapter  I).  One  great  nation  has  attempted  to  abolish 
the  system  and  to  substitute  government  by  organized  labor.  It  was 
only  in  191 1  that  American  states  began  seriously  to  safeguard  the 
security  of  workers  through  accident  compensation  laws,'  but  the 
large  amount  of  work  yet  remaining  to  be  done  in  this  very  limited 
field  is  shown  by  Professor  Fisher  in  his  chapter  on  the  subject 
(Chapter  II).  The  extent  to  which  England  has  gone  in  health 
insurance  and  unemployment  insurance  is  shown  by  Miss  Halsey 
(Chapters  III  and  IV) ;  while  Mr.  Lynch,  former  Chief  of  the  Inter- 
national Typographical  Union,  shows  how  recent  and  imperfect  as 
yet  are  the  efforts  of  trade-unions  in  provisions  against  sickness 
(Chapter  V).  The  relation  of  insurance  to  sickness  prevention  is 
shown  in  Chapter  VI. 

The  instability  of  employment  has  its  personal  and  economic 
causes.  How  shall  they  be  distinguished  ?  And,  whether  they  are  or 
are  not  distinguished,  what  is  the  social  significance?  Out  of  fifty 
or  more  interviews  with  wandering  laborers  had  by  Mr.  Speek  in 
19 14  I  have  selected  two  (Chapter  VII).  When  you  have  read  two 
or  three  the  others  furnish  very  little  that  is  new.  A  corroborative 
view  is  given  from  a  municipal  lodging  house  (Chapter  VIII) ;  and 
the  migration  of  the  negroes  to  the  North  and  West  adds  its  evidence 
of  insecurity  (Chapter  IX).  How  these  workers  come  and  go  at 
the  employment  offices,  and  the  need  of  a  correct  national  system 
of  offices,  is  shown  by  Mr.  Lescohier  from  his  experience  in  con- 
ducting a  federal-state  office  (Chapter  X). 


1  Commons  and   Andrews,   Principles   of   Labor   Legislation,   p.  397. 
York,  1920. 


New 


IX 


I 


w 


11 


X  TRADE  UNIONISM  AND  LABOR  PROBLEMS 

/  Management  without  democracy  is  the  very  despotism  that  pro- 
vokes revolution,  and  the  problem  of  industry  is  truly  the  problem 
of  management.  Scientific  management,  applied  to  labor,  passes 
through  two  stages :  the  older  engineering  stage,  that  dealt  with  indi- 
viduals, and  the  newer  personnel  stage,  that  deals  with  committees 
and  unions.  The  main  points  of  the  older  scientific  management, 
as  it  affects  labor,  are  presented  in  extracts  from  Mr.  Taylor's  ad- 
dress to  the  labor  organizations  of  Milwaukee,  and  the  attitude  of 
trade-unions  is  shown  in  the  reply  of  Mr.  Alifas,  representing  the 
Metal  Trades  Union  affiliated  with  the  American  Federation  of  Labor 
(Chapter  XI).  Mr.  Taylor's  great  contributions  to  scientific  man- 
agement were  begun  more  than  twenty  years  ago.  Scarcely  five  years 
ago  did  employers  begin  generally  to  install  labor  departments  or 
personnel  departments  in  their  factories.  The  deciding  cause  was 
the  labor  turnover  (Chapter  XII),  with  its  newly  discovered  enor- 
mous expense  to  the  employer.  The  discovery  of  the  labor  turnover 
begins  the  employer's  scientific  study  of  the  laborer  as  a  man,  where 
the  older  "scientific  management"  had  begun  to  study  him  only  as 
a  producer.^  A  notable  instance  is  given  by  Mr.  Feiss  showing  the 
transition  from  the  old  scientific  management  to  the  new  labor 
management  (Chapter  XIII). 

There  is  no  automatic  solution,  no  panacea  for  labor  problems,  and 
democracy  without  management  reverts  to  despotism  on  the  mere 
ground  of  its  inefficiency.  After  the  Soviets  had  taken  possession  of 
the  Russian  factories  and  the  Bolshevik  party  had  won  over  the 
Soviets,  the  confiscation  of  the  factories  without  compensation,  the 
expulsion  of  the  managers,  and  the  resulting  breakdown  of  credit 
and  discipline  compelled  Lenin  to  resort  to  despotism  in  the  name 
of  labor,  to  the  prohibition  of  strikes  enforced  by  dictatorship  of  the 
army,  to  proposals  of  "scientific  management"  which  he  had  pre- 
viously condemned,  and  to  offers  of  high  salaries  to  managers  if  they 
would  return.  The  fundamental  wrong  was  confiscation,  on  a  false 
theory  that  labor  alone  creates  wealth,  whereas  credit  and  good  faith 
are  equally  important  in  the  process  of  production  (Chapter  XIV). 

In  Chapter  XV  Mr.  McCabe  has  analyzed  with  remarkable  insight 
the  principal  methods  of  bonus  and  premium  payment.   The  older 
scientific  management,  as  applied  to  labor,  achieved  its  success  in 
1  Commons,  Industrial  Goodwill.    New  York,  1919. 


INTRODUCTION 


XI 


the  scientific  study  of  work  and  compensation  for  work,  but  placed 
too  much  reliance  upon  science  as  a  means  of  restraining  greed  in  the 
conflict  of  capital  and  labor.  Mr.  Mixter's  knowledge  and  expe- 
rience of  scientific  management  enables  him  to  point  out  the  crux 
of  the  matter  and  leads  him  to  propose  a  rather  drastic  remedy 
(Chapter  XVI).  Mr.  Wolf  has  made  notable  discoveries  in  scientific 
methods  of  securing  the  initiative  of  workers  in  production,  which 
he  describes  (Chapter  XVII),  while  Mr.  Alexander  describes  the 
apprenticeship  system  of  the  General  Electric  Company,  which  had 
its  inception  at  their  West  Lynn  Works  and  which  has  become  the 
model  for  many  other  companies  (Chapter  XVIII).  Mr.  Emmet 
made  a  prolonged  investigation  of  profit-sharing  systems,  visiting  all 
of  the  establishments  whose  systems  he  describes  (Chapter  XIX), 
and  Mr.  Baker  tells  of  the  plan  in  the  factory  of  which  he  is  the 
head,  a  plan  which  has  carried  profit-sharing  over  almost  into  pro- 
ducer's cooperation  (Chapter  XX).  By  means  of  his  profit-sharing 
and  cooperative-government  system,  Mr.  Mitten  converted  the  Phila- 
delphia Rapid  Transit  Company  from  imminent  bankruptcy  into  a 
profitable  business  (Chapter  XXI).  Mr,  Renold  gives  a  systematic 
and  comprehensive  sketch  of  a  shop-committee  system,  a  system 
partly  in  operation  in  his  works  at  Manchester,  England,  and  partly 
expanded  to  meet  new  conditions  (Chapter  XXII).  Mr.  Douglas 
and  Mr.  Wolfe,  of  the  Emergency  Fleet  Corporation,  describe  that 
gigantic  governmental  venture  in  labor  management  (Chapter 
XXIII). 

The  newer  scientific  management,  which  deals  more  or  less  collec- 
tively with  labor,  takes  its  new  policy  from  trade-unionism.  Chapter 
XXIV  shows  the  attitude  of  the  American  Federation  of  Labor 
towards  these  very  systems  of  shop  committees  or  "employer's 
unions,"  which  are  presented  in  the  preceding  chapters.  That  trade- 
unionism  is  not  a  fixed  or  simple  affair,  but  is  as  changeable  and 
diversified  as  the  industrial  and  governmental  conditions  which  it  en- 
deavors to  control  or  regulate,  is  shown  by  Mr.  Janes  (Chapter 
XXV).  Mr.  Glocker  shows  the  tendency  toward  closer  cooperation 
of  unions  in  related  trades  (Chapter  XXVI),  and  Mr.  Bamett 
the  development  of  a  distinctive  feature  of  American  unions — the 
supremacy  of  national  over  local  unions  in  a  single  trade  (Chap- 
ter XXVII).     Miss  Stecker  (Chapters  XXVIII  and  XXIX)  and 


Xll 


TRADE  UNIONISM  AND  LABOR  I'ROBLEMS 


INTRODUCTION 


Xlll 


Mr.  Wolman  (Chapter  XXX)  show  the  contrasted  outcome  of  the 
introduction  of  machinery  in  the  relations  of  organized  employers  and 
trade-unions  on  a  national  scale,  while  Mr.  Cross  (Chapter  XXXI) 
and  Mr.  Deibler  (Chapter  XXXII)  show  respectively  the  dominance 
of  unions  (San  Francisco  building  trades)  and  the  equilibrium  of 
employers  and  employees  (Chicago  patternmakers)  in  collective  bar- 
gaining. Mr.  Sydenstricker  shows  the  development  of  the  famous 
Anthracite  Coal  Strike  Arbitration  of  1903,  which  established  an 
open-shop  agreement  without  recognition  of  the  union  (Chapter 
X.XXIII),  and  Mr.  Stewart  shows  certain  effects  in  the  bituminous 
coal-mining  industry  of  the  characteristic  effort  of  trade-unions  to 
equalize  competitive  conditions  (Chapter  XXXIV).  Chapter  XXXV 
gives  verbatim  the  shop  agreement  of  Hart  Schaffner  &  Marx,  which 
has  recently  (1919)  been  extended  to  cover  the  entire  competitive 
men's  clothing  industry  throughout  the  principal  manufacturing 
centers  of  the  United  States. 

The  essentially  conservative  program  of  the  American  Federation 
of  Labor  is  brought  out  in  Chapter  XXXVI  and  should  be  com- 
pared with  the  program  of  the  British  Labor  Party  readily  available 
in  the  Monthly  Review,  United  States  Bureau  of  Labor  Statistics, 
April,  1918. 

The  transition  in  the  juristic  theories  of  American  courts  from  the 
individualistic  notions  of  the  eighteenth  and  nineteenth  centuries 
to  the  collectivistic  notions  of  the  twentieth  century  appears  vividly 
in  the  articles  by  Roscoe  Pound  (Chapter  XXXVII)  and  Felix 
Frankfurter  (Chapter  XXXVIII)  of  the  Harvard  Law  School, 
while  the  hesitancy  of  the  Supreme  Court  in  extending  the  innova- 
tions to  labor  organizations  is  shown  by  Mr.  Powell,  of  Columbia 
University  (Chapter  XXXIX).  The  complete  adoption  of  collec- 
tivistic theories  of  jurisprudence  is  seen  in  detail  as  Chief  Justice 
Higgins,  of  the  High  Court  of  Australia,  reviews  the  decisions  handed 
down  by  the  Australian  Court  of  Conciliation  and  Arbitration 
(Chapter  XL),  while  Mr.  Compton  analyzes  the  economic  theories 
underlying  this  new  province  of  law  (Chapter  XLI),  and  Mr.  Taussig 
shows  the  economic  limits  within  which  it  may  be  expected  to  be 
confined  (Chapter  XLII). 

The  most  complete  study  yet  made  of  minimum-wage  laws  in 
American  states  is  given  by  Miss  Douglas    (Chapter  XLIII).   A 


i 


careful  study,  on  the  ground,  of  the  operations  of  the  Canadian 
effort  to  limit  the  right  to  strike  during  investigation  is  given  by 
Mr.  Squires  (Chapter  XLIV),  while  the  editor  of  this  book  presents 
considerations  leading  to  a  plan  for  elimination  by  federal  law  of 
perhaps  the  most  serious  blot  on  American  industry,  the  twelve-hour, 
seven-day  system  of  the  steel  industry,  which,  in  1919,  withstood 
the  attack  of  organized  labor  (Chapter  XLV). 

These  chapters  are  selected  with  a  view  to  setting  forth  five  prin- 
cipal aspects  of  labor  problems.  The  first  in  importance  is  Security 
(Part  I),  beside  which  all  other  problems  are  relatively  simple.  Next 
is  the  Labor  Market  (Part  II),  wherein  the  problem  is  closely  related 
to  security.  Next  is  Labor  Management  (Part  III),  the  part  played 
by  employers;  then  the  part  played  by  Labor  Unions  (Part  IV); 
and  finally  the  part  played  by  the  state  through  legislation, 
administration,  and  judicial    decision  (Part  V). 


TRADE  UNIONISM  AND 
LABOR  PROBLEMS 

PART  I.   SECURITY 


INDUSTRIAL   RELATIONS' 

THERE  is  no  automatic  method  of  bringing  about  industrial 
peace;  no  panacea  can  be  proposed.  The  socialists  propose  a 
panacea  They  consider  that  the  conflict  of  capital  and  labor  spnngs 
from  the  historical  fact  of  private  property,  and  that  if  pnvate  prop- 
erty is  abolished  and  all  property  made  common,  then  there  will  be 
harmony.  There  will  be  no  clashes  and  no  conflict.  ^^^Jf""^ 
abolish  conflict  and  bring  about  industrial  peace  by  abohshmg  pri- 
vate property,  but  in  order  to  accomplish  that  result  they  must  also 
abolish  liberty.  As  long  as  there  is  liberty  there  will  be  strikes  for 
a  strike  is  nothing  more  nor  less  than  liberty  to  stop  work  and  to 
wait  for  a  bargain-it  is  a  process  of  negotiation,  it  is  a  scheme  o 
withholding  your  property  until  you  can  agree  on  the  terms  of 

6XCll3.nfi[C 

The  principal  new  thing  about  this  situation  in  modern  industry 
is  that  it  is  conducted  on  a  large  scale,-much  more  than  we  have 
ever  known  before -and  that  is  because  there  is  more  liberty  than 
has  ever  been  known  before.  It  has  only  been  two  generations  that 
the  workman,  under  our  constitution,  has  been  free.  We  have  a  new 
situation.  The  libertv  of  labor  is  a  new  phenomenon,  and  it  should 
not  be  surprising  that  we  have  not  learned  to  deal  either  with  the 
institution  of  property  or  with  the  liberty  of  the  workingman.  They 
are  both  new  problems. 

iFrom  an  address,  "Bringing  about  Industrial  Peace,"  before  the  Conference 
of  the  National  Association  of  Employment  Managers,  December  13,  iQiQ- 


i! 


2  TRADE  UNIONISM  AND  LABOR  PROBLEMS 

It  would  be  futile  to  propose  any  single  solution  of  the  so-called  labor 
problem.  Two  things,  however,  may  be  mentioned  which  seem  to  be 
impossible  in  the  direction  of  a  solution  of  the  task  of  bringing  about 
industrial  peace.  It  cannot  be  brought  about  by  rough  methods. 
We  have  gone  through  considerable  discussion  of  compulsory  arbitra- 
tion, and  there  has  been  a  considerable  reliance  on  the  injunction  and 
on  threats.  These  crude  methods  are  breaking  down.  We  may  put 
the  leaders  in  jail,  we  may  prevent  them  from  using  the  mails,  and 
we  may  tie  up  their  funds  ;  but  if  beneath  what  the  leaders  are  doing 
there  is  a  real  grievance,  a  real  unrest  and  a  mass  movement,  we 
cannot  permanently  suppress  it.  The  rough  method  has  about 
reached  its  limit.  It  has  failed  in  the  different  countries  where  it  has 
been  tried,  and  recent  events  in  this  country  seem  to  prove  that  we 
cannot  resort  to  the  rough  method  of  bringing  about  industrial  peace. 

Then  there  is  another  means  which  has  been  resorted  to  more  or 
less,  the  method  of  misrepresentation.  Perhaps  the  greatest  offender 
in  the  method  of  misrepresentation  is  the  United  States  Steel  Cor- 
poration. It  flooded  this  country  with  propaganda  of  Bolshevism,  as 
though  the  laboring  people  of  the  United  States,  who  are  demanding 
the  abolition  of  the  twelve-hour  day  and  the  seven-day  week,  were 
animated  by  the  desire  of  taking  possession  not  only  of  the  factories 
of  the  Steel  Corporation  but  of  all  factories.  Apparently  they  suc- 
ceeded in  that  propaganda  and  misrepresentation.  You  find  through- 
out the  country  not  only  an  unrest  amongst  laborers  but  a  decided 
unrest  amongst  employers.  Employers  have  become  easy  marks — 
anybody  who  has  a  panacea  can  come  to  an  employer  and  lift  $ioo 
out  of  his  pocketbook  by  offering  him  a  remedy  against  Bolshevism. 
The  unrest  which  has  been  stirred  up  amongst  employers  by  the 
Steel  Corporation  in  its  wonderful  propaganda  is  a  menace  to  the 
industrial  peace  of  the  country.  Neither  rough  methods  nor  mis- 
representation will  permanently  bring  about  industrial  peace. 

If  we  cannot  rely  upon  these  methods  of  the  past,  what  is  going  to 
be  the  method  and  what  can  we  offer  as  a  remedy  in  bringing  about 
industrial  peace  ?  In  my  judgment  the  method  is  one  not  of  a  year 
or  two  years  but  of  many  years.  It  is  the  method  of  prevention. 
We  must  investigate  the  conditions  which  cause  this  industrial 
unrest  and  we  must  prepare  in  advance  to  remove  the  conditions 
which  cause  conflict  to  waken  up. 


INDUSTRIAL  RELATIONS  3 

Last  February  the  administration  at  Washington  might  have 
known  what  was  going  to  happen  in  the  coal-mining  industry.  The 
administration  had  all  of  the  means  of  knowing  how  many  hours' 
work  the  men  were  getting  in  the  week ;  they  had  the  means  of 
knowing  that  after  the  armistice  was  signed  employment  fell  off; 
that  during  the  winter  months  and  on  through  the  summer  the  men 
were  not  working  two  thirds  of  the  time,  or  even  half  time  ;  that  in  the 
winter  they  were  compelled  to  sell  their  Liberty  Bonds,  they  were 
compelled  to  eat  up  their  savings,  and  there  was  great  suffering  in 
many  parts  of  the  mining  districts.  Anyone  who  attended  that  con- 
vention of  the  mine-workers'  union  in  Cleveland  last  summer  and 
saw  those  twelve  hundred  mine-workers  coming  up  out  of  the  ground 
in  one  great  solid,  unanimous  opinion  could  not  for  a  minute  conceive 
that  their  unrest  was  the  work  only  of  agitators  and  leaders.  They 
were  not  officials,  they  were  not  the  salaried  leaders  defending  their 
jobs.  They  were  the  actual  mine-workers  sent  there  by  the  local 
unions  to  protest  against  conditions. 

They  made  a  great  statistical  blunder  and  perpetrated  an  eco- 
nomic fallacy.  Their  statistical  blunder,  owing  to  the  lack  of  proper 
statistical  information,  led  them  to  ask  for  an  increase  of  60  per 
cent  in  their  wages.  They  figured  it  out  accurately,  according  to 
the  light  which  they  had.  Their  statistician  had  figured  that  their 
cost  o'f  living  had  gone  up  about  104  per  cent,  whereas,  as  a  matter 
of  fact,  it  had  gone  up  only  80  per  cent— they  had  taken  wholesale 
prices  rather  than  retail  prices.  They  figured  their  wages  had  gone 
up  44  per  cent  and  they  wanted  another  60  per  cent,  and,  added 
to  the  44  per  cent  on  the  19 14  basis,  that  would  have  brought  them 
up  exactly  even  with  the  cost  of  living. 

Their  economic  fallacy  was  based  on  the  idea  that  by  restricting 
the  hours  of  labor  to  six  they  could  force  industry  to  equalize  em- 
ployment throughout  the  year.  The  impression  was  generally  spread 
over  the  country  that  what  they  intended  to  do  was  to  restrict  the 
output  by  cutting  the  hours  from  eight  to  six.  We  all  know  now 
that  what  they  were  really  trying  to  do  was  to  distribute  the  work 
evenly  throughout  the  year.  A  man  working  in  a  coal  mine  often 
does  not  know  until  the  w^histle  blows  in  the  evening  whether  there 
will  be  work  tomorrow  or  not.  When  he  goes  to  work  in  the  morning 
he  does  not  know  whether  he  will  have  two,  three,  four,  five,  or 


4  TRADE  UNIONISM  AND  LABOR  PROBLEMS 

eight  hours  of  work.  Living  in  this  state  of  uncertainty,  not  simply 
for  the  year  but  for  twenty  or  thirty  years,  the  mine-worker  has 
been  brought  up  on  the  conviction  that  each  time  he  reduces  the 
hours  of  labor  he  forces  the  employer  to  distribute  the  work  more 
evenly  He  is  not  asking  for  less  work,  he  is  asking  for  steady  work. 
The  administration  at  Washington  should  have  known  these  con- 
ditions  and  circumstances.  They  had  the  correct  statistical  informa- 
tion they  knew  the  conditions  in  the  industry,  and  at  the  time  when 
the  'administration  lifted  the  ban  on  the  operators'  price  of  coal  they 
should  have  negotiated  with  the  operators  to  bring  about  an  adjust- 
ment of  wages  so  as  to  meet  accurately  the  cost  of  living. 

This  fluctuation  of  prices,  this  changing  cost  of  living,  has  been 
goin-  on  for  an  entire  century.    It  is  not  a  new  phenomenon.    One 
hundred  years  ago,  at  the  close  of  the  Napoleonic  Wars,  we  had  the 
same  situation.    We  had  it  again  in  the  thirties  owing  to  wildcat 
banking  at  that  time.   We  had  it  during  the  Civil  War,  and  now  we 
have  it  repeated.    We  have  had  in  all  of  these  periods  quite  the  same 
crude  explanation  of  the  facts-the  rise  of  prices  has  always  been 
charged  up  to  monopolies  and  profiteering.    It  has  now  been  charged 
up  to  restrictions  by  the  laborers.    It  may  be  true,  and  no  doubt  it 
is  that  there  is  profiteering  and  that  there  is  "laying  down"  on  the 
job  by  wage-earners,  but  if  we  try  to  figure  out  how  much  influence 
either  profiteering  or  restrictions  by  labor  has  on  the  elevation  of 
prices  I  think  we  will  have  to  conclude  that  if  we  could  stop  all  of 
the  profiteering  and  stop  all  of  the  restrictions  by  labor,  it  would  not 
affect  the  total  result  very  materially.    Profiteering  and  restrictions 
are  mainly  results,  not  causes,  of  rising  prices.    The  high  cost  of  living 
is  something  that  neither  the  employer  nor  the  employee  can  prevent. 
It  does  not  come  from  anything  under  the  power  of  capital  and  labor 
to  overcome,  and  yet  it  is  the  one  great  cause  of  uncertainty  and 
unrest,  and  has  been  for  a  whole  century. 

The  fluctuation  of  currency  is  the  greatest  of  all  the  labor  problems. 
It  throws  a  red  brick  continually  into  capital  and  labor.  The  first 
great  method  of  importance  in  bringing  about  industrial  peace  is  the 
stabilizing  of  the  dollar.  If  we  could  have  a  system  of  currency  in 
which  the  great  price  movements  which  have  been  occurring  in  all 
these  years  could  be  stabilized,  we  would  do  more  to  stabilize  in- 
dustry, to  bring  about  industrial  peace,  than  any  other  one  thing. 


INDUSTRIAL  RELATIONS  5 

In  times  of  rising  prices  we  have  restrictions,  aggressive  movements ; 
in  times  of  falling  prices  we  have  unemployment,  bankruptcy,  and 
depression.  The  whole  situation  is  rendered  unstable,  and  we  are 
living  continuously  in  a  period  of  uncertainty. 

I  know  of  no  way  of  reaching  that  question,  which  to  me  seems 
the  most  fundamental  of  all,  except  that  remedy  proposed  by  Irving 
Fisher,  of  stabilizing  the  dollar.^    Yet  we  know  that  a  remedy  of  this 
kind  will  not  come  very  soon.     Consequently  the  best  that  can  be 
done  is  for  employers  and  employees  to  adjust  themselves  to  the 
situation.    Capital  and  labor  alone  cannot  prevent  this  fluctuation. 
There  is,  apparently,  only  one  great  constructive  plan  in  this 
country  on  a  national  scale  which  has  attempted  to  bring  about 
industrial  peace  by  meeting  the  situation  of  the  currency,  and  that 
is  the  plan  which  is  now  being  worked  out  in  the  book  and  job  print- 
ing business  with  the  labor  organizations.   With  the  increased  cost  of 
living,  the  printing  business  did  not  raise  wages.    They  had  their 
agreements  that  had  not  expired  and  did  not  provide  for  raising 
wages.    But  in  two  or  three  places  in  the  country— in  New  York, 
Chicago,  and  Seattle— the  local  unions  violated  their  agreements  and 
went  after  the  increased  wages  by  direct  action.    And,  although  the 
employing  printers  contended  that  they  could  not  pay  the  increase, 
yet  when  they  came  to  it  they  not  only  paid  the  increase  but  they 
paid  more  than  the  increased  cost  of  living.    The^qnly  places  in  the 
United  States  where  labor  actually  secured,  in  the  book  and  job 
printing  business,  an  increase  in  wages  corresponding  to  the  increase 
in  the  cost  of  living  were  where  the  local  unions  defied  their  own 
national  unions.    What  a  lesson  that  was  to  labor  in  the  United 
States!    The  only  way  we  can  keep  up  with  the  cost  of  living  is  by 
violating  our  agreements,  by  resorting  to  methods  which  we  have 
promised  not  to  adopt,  by  defying  our  own  organizations. 

Consequently  we  find  that  the  book  and  job  printing  business  has 
come  together  on  a  national  scale  and  is  in  the  process  of  adopting 
the  principle  that  employers  will  not  wait  until  demands  and  strikes 
are  upon  them,  but  will  automatically  change  the  level  of  wages  as 
the  changing  price  curve  moves  up  or  down.  Every  six  months,  or 
atperiodic  intervals,  a  change  is  proposed  to  be  made  throughout  the 
entire  United  States,  on  the  initiative  of  the  employer— not  waiting 
1  Fisher,  Stabilizing  the  Dollar.   New  York,  1919. 


6  TRADE  UNIONISM  AND  LABOR  PROBLEMS 

for  labor  to  make  the  demand,- thus  heading  off  this  unrest  in 
the  localities.    In  doing  that  the  employing  printers  throughout  the 
United  Stdtes  for  the  first  time  have  joined  with  the  national  or- 
ganizations of  labor  where  their  interests  are  alike,  and  we  see  on  a 
new  national  scale  the  largest  expansion  of  scientific  management - 
capital  and  labor  combining  to  look  ahead  to  the  future  m  order  to 
prevent  industrial  conflict  by  remedying  the  conditions  m  advance. 
Of  course  we  have  the  objection  that  if  an  increase  in  wages  causes 
prices  to  go  up,  and  if  an  increase  in  prices  provokes  a  further  de- 
mand on  the  part  of  labor  for  wages  to  go  up,  we  have  that  vicious 
circle    But  that  vicious  circle  cannot  be  avoided  as  long  as  we  have 
inflation  of  currency.    If  we  had  a  stabilized  dollar,  no  matter  what 
the  relations  are,  the  prices  and  wages  would  be  stabilized  in  ac- 
cordance with  the  general  level  of  the  price  curve.    It  is  a  mistaken 
view  that  it  is  this  pyramiding  of  wages  and  prices  that  keeps  prices 
up.    It  is  not  the  pyramiding  of  wages  and  prices,  it  is  the  inflation 
of  the  world's  currency ;  and  no  matter  what  adjustment  might  be 
made  between  employers  and  laborers,  a  correction  of  the  currency 
of  the  world  could  stabilize  prices  and  prevent  the  need  of  this 
pyramiding.    That   is   the   first   and   most   important   fundamental 
condition  to  be  recognized  in  the  conflict  of  capital  and  labor,  as  it 

appears  to  me. 

What  about  restrictions  of  output?    Everybody  knows  that  m 
good  times  working  people  "lay  down"  on   the  job,  no   matter 
whether  organized  workers  or  not.    People  do  not  work  as  hard  in 
good  times  as  they  do  in  hard  times.   We  have  the  curious  paradox 
that  in  good  times,  when  we  ought  to  increase  the  output,  labor 
restricts  the  output ;  and  in  hard  times,  when  we  don't  want  people 
to  work  so  hard  and  increase  the  supply  of  production,  then  they 
work  the  hardest.    A  business  man  does  not  conduct  his  business 
in  that  way.    In  good  times,  when  prices  are  going  up,  he  tries  to 
increase  his  output ;  in  hard  times,  when  prices  are  falling,  he  tries 
to  restrict  his  output-— he  does  not  buy  more  than  he  can  sell.    In 
other  words,  labor  works  just  the  opposite  of  business.    In  good 
times,  when  prices  are  up,  then  is  when  labor  "lays  down"  on  the 
job  and  refuses  to  increase  the  output  and  keep  up  the  supply.    In 
hard  times,  when  the  demand  has  fallen  off,  then  is  when  labor  works 
the  hardest  and  turns  out  the  most  production.    It  surely  seems  that 


INDUSTRIAL  RELATIONS  7 

we  have  been  going  on  a  wrong  hypothesis  in  dealing  with  labor. 
It  works  out  all  right  in  dealing  with  marketing  and  commodities, 
but  labor  seems  to  work  just  the  opposite. 

We  have  been  going  on  the  theory  that  in  order  to  get  efficiency, 
in  order  to  get  output,  in  order  to  get  laborers  to  work,  there  must 
be  some  kind  of  a  penalty  held  over  the  workingman— the  penalty  of 
unemployment,  the  penalty  of  being  discharged  if  he  does  not  work, 
if  he  does  not  do  his  duty,  if  he  is  not  on  the  job.  It  is  then 
that  he  suffers  the  penalty  of  being  discharged  from  his  job.  Our 
method  has  been  the  rough  method  of  disciplining  labor  by  the 
penalty  of  unemployment. 

That  penalty  does  not  work  in  good  times ;  it  works  too  much  in 
hard  times.  In  good  times  the  workman  is  not  afraid  of  unemploy- 
ment. What's  the  use?  If  he  is  discharged,  he  can  go  across  the 
street  and  get  another  job.  In  hard  times,  when  we  don't  want  so 
much  produced,  then  he  works  hard  because  he  is  afraid  of  unem- 
ployment and  cannot  go  across  the  street  and  get  another  job. 
The  psychology  of  labor,  both  in  good  and  in  hard  times,  is  funda- 
mentally the  psychology  of  a  class  of  people  whose  life  is  insecure, 
who  are  subject  to  rough  methods  of  discipline.  We  cannot  under- 
stand the  problem  of  dealing  with  labor  unless  we  understand  that 
fundamental  fact  of  insecurity  of  employment.  It  is  just  as  vicious 
in  good  times  as  it  is  in  hard  times.  In  good  times  the  workingman's 
high  wages  are  an  injury  to  him ;  he  gets  too  much  money,  and  he 
does  not  know  what  to  do  with  it  and  spends  it  extravagantly,— 
burns  it  up,  —  and  when  the  hard  times  come  he  has  nothing  to  fall 
back  upon.  The  fluctuation  of  earnings— great  earnings  in  good 
times,  falling  off  in  hard  times — is  demoralizing  to  the  character  of 
working  people. 

If  we  have  to  depend  upon  the  rough  method  of  discharge  for  get- 
ting efficiency,  then  we  are  going  to  keep  labor  continually  unstable 
and  uncertain,  and  the  character  of  the  workingman  will  not  rise  to 
the  occasion  of  modern  industry. 

Modern  capitalism  is  not  based  upon  the  ownership  of  physical 
things.  We  might  see  much  of  our  machinery  and  our  buildings  de- 
stroyed by  earthquake  or  war,  but  we  all  know  that  if  we  retain  the 
credit  system  it  will  not  be  very  long  until  all  of  our  machinery  and 
buildings  are  restored.   We  usually  consider  that  the  production 


smamm 


8  TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  wealth  is  brought  about  by  the  union  of  capital,  management, 
and  labor.     Capital  is  the  physical  machinery  and  the  tools ;  man- 
agement is  the  organizing   element;    labor  produces   the  physical 
product.    The  three  must,  indeed,  be  combined,  but  the  greatest 
instrument  of  production— the  thing  that  really  produces  modern 
wealth— is  not  physical  things,  is  not  labor,  is  not  management; 
it   is   confidence  in  the   future,   it   is   a   credit  system   based   on 
the  expectation  of  industrial  continuity— an  expectation  that  debts 
will  be  paid.    The  capitalistic  system  is  security  of  expectations. 
If  we  could  not  offer  security  to  the  investor,  we  might  still  have 
production  of  wealth.    Physical  things,  management,  and  labor  might 
go  on  producing  wealth,  but  you  know  how  much  wealth  could  be  pro- 
duced if  it  were  not  for  our  credit  system.    The  production  of  wealth 
would  fall  back  to  what  it  was  in  colonial  times  ;  nobody  could  ship 
his  product  to  anybody  else,  and  we  would  not  trust  one  another. 
Capital  is  based  upon  security  of  expectations.    The  investor  has  con- 
fidence that  his  investment  will  be  returned  to  him,  that  promises  will 
be  kept.    That  is  the  great  producing  factor  in  modern  industry. 

Now  capitalism  is  to  blame  because  it  has  not  offered,  as  yet,  to 
labor  that  security  of  the  job  which  it  has  offered  to  the  investors  in 
the  security  of  their  investments.  Capitalism  is  threatened  because 
it  has  not  furnished  the  working  people  a  similar  security  to  that 
which  it  has  furnished  to  the  investors.  The  workingmen  are  getting 
the  idea  throughout  the  world  that  the  elements  that  produce  wealth 
are  the  workingmen  and  the  management ;  and  we  have  the  Plumb 
plan,  in  which  two  million  workers  in  the  United  States  come 
forth  to  oust  the  credit  system  and  let  simply  management  and  labor 
produce  the  wealth  of  the  country.  They  would  destroy  the  thing 
upon  which  the  credit  of  the  railroads  is  built,  because  they  think 
that  the  producing  elements  are  management  and  labor. 

Well,  that  is  much  the  same  idea  that  they  have  in  Russia,  and 
that  is  the  fundamental  notion  of  modern  laboring  people  spreading 
throughout  the  world.  They  do  not  appreciate  that  modern  capital- 
ism is  based  on  faith  in  the  future  ;  they  have  not  themselves  been 
given  that  same  security.  Capitalism  to  them  is  autocracy  and  in- 
security. They  have  tried  to  get  security  by  rough  methods.  Trade- 
unionism,  closed  shop,  union  shop,  and  so  on  are  their  methods  of 
obtaining  security  of  the  job.   Not  until  the  capitalistic  system,  not 


INDUSTRIAL  RELATIONS  9 

until  the  great  financial  interests  that  control  this  country,  have 
learned  that  it  is  just  as  important  to  furnish  security  for  the  job  as 
it  is  to  furnish  security  for  the  investment  will  we  have  a  permanent 
provision  for  industrial  peace. 

We  have  only  begun  in  recent  years  to  try  to  establish  security 
of  the  job.  The  first  effort  made  was  eight  or  ten  years  ago  in  the 
workmen's  compensation  law— the  accident-compensation  law.  That 
was  the  first  comprehensive  effort  to  establish  security  for  the  job. 
Unemployment  no  longer  damages,  as  it  did,  the  man  who  is  hurt 
during  employment.  The  next  step  is  probably  the  similar  treatment 
of  sickness  insurance. 

In  the  case  of  accident  compensation  this  curious  thing  developed : 
employers  vigorously  fought  the  legislation  at  first  because  it  was 
going  to  increase  the  cost  of  production  and  the  expenses  of  business  ; 
but  after  the  law  was  enacted  and  the  employers  were  compelled  by 
law  to  pay  compensation,  they  introduced  a  new  element  in  industry 
—they  introduced  a  safety  expert.  They  developed  a  new  depart- 
ment of  industry.  I  knew  of  an  establishment  that  figured  that  if 
the  compensation  law  was  enacted,  their  premium  on  insurance  would 
increase  from  $5000  to  $22,000  a  year.  That  was  what  they  were 
told  by  the  insurance  people  and  by  their  claim  agent,  and  they  were 
dreadfully  scared.  After  the  law  was  enacted,  however,  they  changed 
their  claim  agent  into  a  safety  expert,  and  the  very  first  year,  instead 
of  paying  $22,000  for  compensation,  or  even  $5000,  it  cost  them 
only  about  $2500. 

The  accident-compensation  law  has  accomplished  the  first  little 
step  toward  giving  security  to  the  job.  It  has  shown  that  the  only 
way  to  establish  security  is  by  making  it  financially  profitable.  And 
so  we  shall  make  it  financially  profitable  to  business  to  eliminate 
unemployment  on  account  of  sickness,  on  account  of  changes  in 
seasons,  on  account  of  fluctuations  in  business.  Labor  can  never  ac- 
complish this  result.  The  only  possible  accomplishment  of  it  will 
come  when  the  employer  puts  in  his  personnel  department,  his 
personal-relations  department,  his  safety  men,  his  welfare  men,  and 
his  men  who  stabilize  employment.  We  know  that  employers  who 
have  done  this  have  made  their  jobs  regular — they  have  regularized 
their  work,  and  there  is  good  reason  to  believe  that  all  can  do  it  if 
the  inducements  are  adequate. 


10         TRADE  UXIONISM  AND  LABOR  PROBLEMS 


There  are  many  ingenious  methods  that  can  be  adopted.  Yet  it 
appears  to  me  that  we  cannot  get  the  large  capitalistic  interests 
awake  to  this  subject  of  stabilizing  employment  unless  the  gov- 
ernment takes  hold  of  it.  If  we  had  a  tax  on  unemployment  of 
$1  a  day  for  every  man  who  is  laid  off,  we  should  soon  find  that 
capitalism  would  put  its  personnel  experts  at  work  to  regularize  the 
business,  and  they  would  have  no  tax  to  pay,  because  they  would 
have  stabilized  the  work. 

The  fundamental  lines  along  which  industrial  peace  is  to  be  brought 
about  are  those  which  go  to  the  psychology  of  the  workingman  and 
substitute  in  his  mind  something  like  that  which  we  have  in  the  mind 
of  the  investor.  The  employer  who  is  willing  to  pay  compensation 
for  unemployment,  who  is  willing  to  furnish  what  the  workingman 
needs,  knows  that  the  workingman  needs  to  have  something  to  wait 
for  and  needs  to  have  confidence  in  the  future. 

I  visited  a  number  of  establishments  this  summer,  making  a 
special  study  of  the  circumstances  under  which  efficiency  had  been 
increasing  or  decreasing,  and  found  that  notwithstanding  some  were 
complaining  about  labor's  laying  down  on  the  job,  yet  in  particular 
establishments  the  output  had  increased.  What  is  the  secret  of  it? 
It  seems  to  me  that  in  all  these  cases  this  was  found  to  be  true: 
a  new  principle  had  come  into  the  business, — management  had  ob- 
tained a  new  view  of  labor, —  and  I  may  contrast  it  by  the  history 
of  scientific  management. 

Mr.  Taylor,  as  you  know,  started  his  wonderful  development 
in  scientific  management  by  offering  to  the  industrial  workers  a 
chance  to  better  their  condition.  He  appealed  to  the  individual 
worker.  But  the  modern  scientific  management  of  personnel  appeals 
to  the  collective  interest  of  all  the  workers  in  the  business.  It  is  be- 
ginning to  recognize  that  the  workingman  does  not  want  to  have  high 
wages  for  himself  if  by  doing  so  he  seems  to  deprive  his  fellow 
workers  of  high  wages.  It  is  as  though  we  are  upon  a  ship  on  the 
ocean — there  is  only  a  limited  amount  of  products  to  go  around; 
the  man  who  saves  his  own  life  and  lets  the  others  go  down  cannot 
live  with  his  fellows  afterward.  So  it  is  with  the  modern  working- 
man  ;  he  is  continually  haunted  by  the  feeling  that  there  is  only  a 
limited  product  to  be  distributed,  and  consequently  even  the  better 
men,  when  appealed  to  individually  to  increase  their  wages,  cannot 


INDUSTRIAL  RELATIONS 


II 


stand  it  to  go  ahead  too  far  amongst  their  fellow  workers.  If  they 
get  out  of  the  class  of  ordinary  workmen  and  become  foremen  and 
superintendents,  that  is  one  thing ;  but  to  stay  in  the  ranks  of  labor 
and  to  earn  much  more  than  the  others  seems  to  be  taking  bread  out 
of  the  mouths  of  their  fellow  laborers. 

Modern  management  is  learning  to  deal  collectively  with  the  work- 
men in  the  shop ;  whatever  one  worker  does  to  benefit  that  shop  will 
benefit  all  of  us — we  are  all  going  to  be  lifted  up  together.  We  are 
not  going  to  set  workingmen  competing  with  each  other  and  try  to 
get  one  ahead  of  the  others  and  appeal  only  to  his  self-interest.  That 
was  all  right  in  times  past,  when  the  world  seemed  to  be  full  of  un- 
occupied resources,  when  anybody  could  go  out  and  get  all  he  wanted 
and  yet  not  take  it  from  anybody  else.  Now,  as  we  are  getting  closer 
together,  as  business  is  getting  on  a  large  scale,  the  man  who  gets 
more  for  himself  seems  to  be  taking  it  from  the  others,  and  so  we 
have  that  solidarity  of  labor  which  is  a  psychology  that  must  be 
recognized  by  all  management. 

This  psychology  should  be  combined  with  the  idea  that  the  busi- 
ness itself  is  the  place  where  we  shall  have  our  living  —  our  confidence 
in  the  future.  I  visited  INIr.  Ford's  factory  recently.  Mr.  Ford  does 
not  have  an  idea  there  of  cultivating  the  efficiency  of  his  laborers. 
His  great  profit-sharing  system,  as  you  know,  is  a  distribution  not  to 
men  who  are  efficient,  in  order  to  increase  the  output,  but  to  men 
who  lead  a  "clean  and  wholesome"  life — they  get  the  profit.  The 
men  who  do  not  lead  a  clean  and  wholesome  life  do  not  get  profits. 
John  D.  Rockefeller,  the  senior,  says  that  Ford's  plan  is  the  indus- 
trial miracle  of  the  age.  Well,  the  Ford  plant  is  the  psychological 
miracle  of  the  age.  It  has  not  gone  after  efficiency  first ;  it  has  gone 
after  the  clean  and  wholesome  life.  Efficiency  is  a  by-product  of  the 
clean  and  wholesome  life. 

When  I  visited  the  White  IMotor  Company  I  was  impressed  with 
the  fact  that  it  is  not  in  detailed  methods  of  piece  and  bonus  pay- 
ments that  they  try  to  reach  the  individual  and  increase  his  pro- 
duction, but  it  is  in  creating  the  conviction  in  every  man  in  that 
industry  that  that  is  his  industry,  that  the  future  of  that  concern 
is  his  future.  Thinking  and  planning  for  the  future  is  the  White 
Motor's  big  efficient  machinery  of  production,  just  as  security  for 
investment  is.    Get  capital  to  think  of  the  security  of  the  job  and  it 


If  I 


12 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


begets  efficiency  of  labor.   We  must  look  upon  efficiency  as  a  by- 
product and  not  as  the  main  thing  in  industry. 

It  seems  to  me,  to  transfer  this  to  the  national  scale,  here  is  where 
capitalists  have  fallen  down.    Mr.  Gary  has  fallen  down  representing 
the   capitalistic   system;    labor   organizations   have    fallen   down; 
Mr.  Gompers,  representing  trade  unionism,  has  fallen  down;   the 
politicians  have  fallen  down  in  bringing  about  industrial  peace.^ 
Where  shall  we  look  for  any  people  in  the  United  States  who  have 
the  preventive  idea  ?  who  can  look  forward  and  plan  for  the  future  ? 
who  will  base  the  bringing  about  of  industrial  peace  on  knowledge  of 
labor  and  on  knowledge  of  security  ?    We  must  look  for  it  in  placing 
the  personal-relations  department  ahead  of  the  engineering,  com- 
mercial, and  production  departments  of  industry.    It  is  only  in  the 
personnel  department  that  we  find  the  beginnings  of  true  scientific 
management  — the  department  of  scientific  human  relations,  which 
appreciates  and  knows  what  are  the  fundamental  things  for  labor's 
efficiency.    If  we  can  have  our  modern  industry  conducted  as  a 
personal-relations    industry,    above    the    commercial    department, 
above  the  engineering  department,  above  the  manufacturing  depart- 
ment, above  the  production  department,  and  if  we  could  bring  to- 
gether on  a  national  scale,  instead  of  our  great  financiers,  instead  of 
our  great  labor  unions,  instead  of  our  politicians, — if  we  could  bring 
together  those  who  are  developing  the  modern  personal-relations 
method,  then  I  think  we  might  work  out  some  plan  for  bringing  about 

industrial  peace. 

Yet  it  is  because,  and  to  the  extent  that,  personal-relations  depart- 
ments are  coming  to  recognize  some  form  of  collective  bargaining  or 
collective  government  that  they  are  fit  to  come  forward  as  national 
leaders  at  this  time.  Socialism  has  no  need  of  personal  relations  in 
management,  because,  according  to  Marx's  theory,  "social  labor 
power"  moves  on  to  its  historic  goal  regardless  of  the  individual 
will.  Capitalism  had  no  need  of  personal  relations,  because  capitalism 
was  but  adjustment  to  the  laws  of  demand  and  supply,  over  which 
individuals  and  classes  have  no  control.  But  with  our  great  cor- 
porations and  associations  on  the  one  hand  and  organized  labor  on 
the  other  it  is  only  by  a  science  of  collective  management  that  capital 

1  Referring  to  the  first  Industrial  Conference  called  together  by  President 
Wilson,  which  split  on  the  question  of  collective  bargainmg. 


I  I 


INDUSTRIAL  RELATIONS 


13 


and  labor  can  work  in  harmony  and  security.    It  becomes  then  a 
science  of  political  economy  as  well  as  a  science  of  business. 

The  science  of  political  economy  began  with  individual  bargaining. 
Adam  Smith,  its  founder,  in  1776,  laid  its  foundation,  and  in  an 
interesting  and  important  chapter  pointed  out  the  great  evil  of 
collective  action.  One  of  the  most  serious  things,  he  thought,  that 
industry  had  to  contend  with  was  association  of  capitalists.  The 
great  evil  of  an  association  of  capitalists  was  that  when  they  combine 
they  deprive  the  minority  of  their  liberty.  The  majority  vote  of  the 
association  binds  the  minority.  Consequently  the  combination  — 
the  association  of  capital  in  corporations — was  condemned  by  him 
as  intruding  upon  the  liberty  of  the  individual.  He  even  went  so 
far  as  to  condemn  social  gatherings  of  merchants,  for  he  said :  "  When 
your  merchants  come  together,  what  does  their  conversation  turn 
to?  It  does  not  turn  to  increasing  efficiency.  K  turns  to  hatching 
up  some  conspiracy  against  the  public." 

Adam  Smith  started  political  economy  upon  the  individualistic 
basis.  He  spoke  at  a  time  when  industry  was  throttled  by  guilds 
and  governments.  The  French  Revolution  overthrew  that  system. 
The  French  Revolution  was  an  attack  by  the  small  manufacturers 
and  merchants,  the  small  capitalists  and  workers,  against  the  govern- 
ment and  the  governmental  regulations  of  the  time.  One  of  the 
great  statutes  of  the  French  Revolution  was  that  statute  which  pro- 
vided that  no  association,  either  of  merchants,  manufacturers,  or 
laborers,  should  be  permitted.  That  statute  stood  on  the  statute 
books  of  France  until  the  year  1884,  when  it  was  finally  repealed. 
Meanwhile,  there  had  grown  up,  unknown  to  Adam  Smith,  unknown 
to  the  French  Revolution,  our  modern  system  of  corporations.  When 
it  came  to  the  middle  of  the  nineteenth  century,  about  the  year  1850, 
for  the  first  time,  with  our  general  incorporation  laws,  it  was  made 
possible  for  any  association  of  capitalists  to  come  together  and  form  a 
legal  association  to  conduct  their  business.  Prior  to  that  time  the  only 
way  in  which  you  could  form  a  corporation  was  by  going  to  the 
legislature  and  asking  for  a  special  charter.  With  the  general  incorpo- 
ration laws,  beginning  about  1850  in  this  country,  it  became  possible 
for  any  group  of  capitalists  to  get  together,  simply  file  their  articles 
with  the  secretary  of  state,  and  become  an  association.  That  violated 
all  the  principles  of  political  economy  and  the  French  Revolution. 


I  I  |: 


14         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  modern  business  world  is  conducted  upon  the  principle  of  as- 
sociation, of  requiring  the  minority  in  a  group  to  submit  to  the  will 
of  the  majority,  and  if  one  person  happens  to  be  the  principal  stock- 
holder, then  all  the  minority  obey  the  will  of  that  one  person.  We 
are  not  living  in  the  time  of  the  French  Revolution ;  we  are  living 
in  the  time  of  the  Russian  Revolution. 

It  differs  entirely  from  the  Fiench  Revolution  in  that  it  is  based 
upon  the  principle  of  government  by  organized  labor — a  scheme 
first  propounded  seventy  years  ago  by  Karl  ]\Iarx,  that  this  capital- 
istic system  must  be  overthrown  and  that  now  was  the  time  for 
workingmen  of  the  world  to  unite.  Russia  has  given  us  the  fruition 
of  that  theory,  based  upon  the  organization  of  labor. 

Our  Western  civilization  today  is  confronted  by  an  entirely  dif- 
ferent situation.  At  the  time  of  the  French  Revolution  we  had  a 
new  world  opening  up  to  which  the  oppressed  peoples  might  escape. 
This  has  been  going  on  until  at  the  present  time  this  new  world  is 
pretty  well  occupied.  Great  corporations  have  sprung  into  being.  The 
natural  resources  are  controlled,  and  if  the  workingman  is  to  have 
any  opportunity,  he  cannot  secure  it  by  going  west,  by  escaping  from 
Europe  and  settling  on  the  soil  of  America.  When  he  escapes  from 
Europe  he  comes  to  America  and  works  for  a  corporation.  Capital 
has  associated — the  law  has  made  universal  the  right  of  association 
on  the  part  of  capital.  Thus  the  workingman  coming  into  this  new 
world,  with  th^  resources  occupied,  without  any  homestead  law  or 
opportunities  tcr  become  independent,  can  secure  his  advance  only 
as  he  works  with  the  thousands  for  the  corporation. 

Furthermore,  the  small  employers  who  are  not  formed  in  corpora- 
tions are  more  and  more  uniting  in  associations.  We  have  all  kinds 
of  associations — associations  of  farmers,  associations  of  merchants, 
associations  of  independent  manufacturers:  they  are  formed  for 
all  classes  and  purposes  and  they  are  recognized  in  law.  They  are 
created  into  employers'  associations,  operating  with  a  formal  policy 
regarding  labor,  so  that  the  modern  workingman  is  confronted  with 
a  situation  where  associated  effort  is  the  rule  of  the  day,  where 
employers  have  compelled  employees  to  submit  their  individuality 
to  the  control  of  the  majority  in  these  associations  and  corporations. 

The  workingman  of  modern  life,  then,  is  imbued  largely  with 
these  ideas,  which  have  reached  their  disastrous  victory  in  Russia. 


INDUSTRIAL  RELATIONS 


IS 


He  is  welcoming  the  idea,  at  least  toying  with  the  idea,  that  by  group- 
ing together  in  associations  he  may  gain  from  his  employers  that 
which  he  cannot  get  by  escaping  to  the  natural  resources  of  the  coun- 
try. And  whether  we  will  it  or  not,  whether  we  wish  for  it  or  not, 
the  workingmen  of  modern  life,  in  so  far  as  they  are  capable  of 
organizing,  are  doing  so. 

It  is  not  a  theory  of  collective  negotiation  or  collective  govern- 
ment that  we  are  confronted  with ;  it  is  conditions  and  facts.  Work- 
ingmen are  combining  and  cooperating  more  and  more ;  and  the 
more  they  get  intelligence,  the  more  they  get  Americanized,  the  more 
will  they  combine.  In  this  combination  of  workingmen  they  attempt 
to  accomplish  through  collective  power  what  they  cannot  accomplish  as 
individuals.  The  feeling  of  solidarity  is  arising  amongst  them — the 
feeling  that  for  the  large  majority  there  is  no  opportunity  for  them- 
selves as  individuals  except  as  they  move  upward  in  a  mass,  that  if  one 
individual  outdistances  the  others  he  is  injuring  the  others,  but  that 
if  he  uses  his  influence  in  bettering  his  own  condition  so  that,  at  the 
same  time,  it  will  lift  up  the  others,  then  that  is  a  desirable  thing. 
This  feeling  of  solidarity,  this  feeling  of  unity,  is  forcing  him,  as  it 
were,  throughout  the  Western  world  to  assert  what  collective  power 
he  can.  The  employer  who  starts  out  with  an  idea  of  individual 
bargaining  is  confronted  by  the  fact  that  he  perhaps  will  not  have 
a  chance  to  enforce  his  ideas. 

There  are  two  classes  of  employers,  apparently.  There  is  that 
class  of  employers,  corporations,  or  individuals  who  conduct  their 
business  in  such  a  superior  fashion,  who  have  such  personal  relations 
developed  with  their  employees,  that  labor  has  no  desire  to  force  a 
collective  arrangement  upon  them.  There  is  another  class  of  em- 
ployers who,  either  through  their  own  attitude  or  through  the  stress 
of  competition,  are  not  free  to  deal  with  labor  on  these  higher 
personal  relations.  Labor  organization  has  not  come  into  existence 
at  all  to  deal  with  that  first  class  of  employers.  It  has  not  been 
provoked  in  order  to  overcome  any  resistance  on  their  part.  It  has 
come  in  solely  in  order  to  use  coercion  with  reference  to  the  other 
class  of  employers.  The  collective  dealing  which  we  are  discussing 
is  not  to  be  considered  universal ;  it  is  not  to  be  considered  as  apply- 
ing to  all  employers  or  all  capitalists.  It  applies  only  to  those  who 
need  it  because  they  will  not  or  cannot  meet  new  conditions. 


i 


I  * 


- 


1 6        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Labor  organization,  however,  has  this  defect :  when  once  it  has 
started,  when  once  it  has  begun  to  apply,  it  stretches  out  to  reach 
all  employers  in  a  competitive  area.  By  force  of  circumstances  it 
brings  the  others  into  the  fold.  A  small  number  of  employers  or 
corporations  may  be  above  the  level,  but  a  large  proportion  are  in 
that  field  where  there  is  a  contest  and  a  conflict  going  on. 

If  we  let  our  vision  pass  from  the  time  of  Adam  Smith  and  the 
French  Revolution,  when  individual  bargaining  was  the  ideal  of 
political  economy,  down  to  the  time  of  the  Russian  Revolution,  when 
these  very  corporations  themselves,  although  they  have  become  enor- 
mous, are  treated  as  though  they  were  individuals, —  if  we  allow  our 
view  to  pass  over  this  century,  we  shall  widen  our  comprehension  and 
not  only  have  a  place  for  the  individualism  which  produced  the 
French  Revolution  but  have  a  more  intelligent  method  of  meeting  the 
collective  idea  which  has  shown  itself  in  the  Russian  Revolution. 


John  R.  Commons 


University  of  Wisconsin 


II 

AMERICAN    EXPERIENCE    WITH    WORKMEN'S 

COMPENSATION ' 

EXPERIENCE  under  the  American  compensation  statutes  has 
justified  in  fair  measure  the  hopes  and  claims  of  those  who  have 
advocated  the  legislation.  It  has  not  been  millennial.  But  it  has  real- 
ized no  small  part  of  the  advantages  which  were  predicted.    So  much 
may  be  stated  with  entire  confidence  and  after  due  allowance  for  the 
present  incompleteness  of  definitely  relevant  data."    In  fact,  a  reason- 
ably confident  conclusion  of  that  character  might  be  reached  without 
examining  any  of  the  detailed  reports  upon  the  practical  working 
of  the  statutes  and  with  only  a  knowledge  of  the  rate  at  which  the 
compensation  system  has  been  extended  from  state  to  state.   Ten 
years  ago  the  early  and  ready  acceptance  of  workmen's  compensation 
in  other  lands  was  urged  as  a  strong  argument  for  the  enactment  of 
compensation  legislation  in  this  country.    It  was  pointed  out  that 
within  a  quarter  century  the  newer  principles  and  policy  for  the  relief 
of  employees  injured  in  industry  had  been  adopted  in  some  forty 
foreign  jurisdictions,  including  all  of  the  industrially  important  ones, 
and  that,  once  adopted,  nowhere  had  there  ever  been  any  serious 
proposal  to  give  them  up. 

But  foreign  readiness  to  enact  compensation  laws  has  been  more 
than  matched  in  the  United  States.  It  is  not  yet  nine  years  since 
the  first  of  the  really  effective  American  workmen's  compensation 
statutes  were  enacted."'  Yet  such  laws  now  have  been  enacted  in 
forty-two  of  the  forty-eight  states  and  in  Alaska,  Porto  Rico,  and 
Hawaii.   Only   the  District  of   Columbia,  North   Carolina,   South 

iFrom  American  Economic  Review,  Vol.  X  (1920),  pp.  18-47. 

2  Conditions  growing  out  of  the  war  have  delayed  and  even  suspended  the 
publication  of  data  in  several  of  the  states,  including  some  of  the  largest  of 
them,  whose  experience  would  be  most  instructive.  Here  may  be  mentioned 
New  York,  Pennsylvania,  Ohio,  and  Illinois,  as  well  as  a  number  of  others. 

3  In  Kansas  and  Washington  on  the  same  day,  March  14,  1911. 

17 


1  fij 


■■■ 


iS         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Carolina,  Georgia,  Florida,  Mississippi,  and  Arkansas  are  still  without 
compensation  statutes.  And  a  late  appropriation  for  the  District  of 
Columbia  brings  all  public  employees  in  that  jurisdiction  under  the 
provisions  of  the  federal  workmen's  compensation  law.  It  is  not 
credible  that  the  states  would  have  taken  action  so  speedily,  one 
after  another  and  in  full  knowledge  of  what  had  been  done  elsewhere, 
often  in  adjacent  states,  except  upon  conviction  that  the  action  taken 
was  of  proved  wisdom.  Doubtless  none  of  the  tardier  legislatures 
knew  every  effect  of  the  earlier  enactments.  Nobody  knows  as  much 
as  that  even  now.  But  they  did  know,  through  universal  report  and 
belief,  that  of  evil  effects  there  had  been  as  good  as  none  and  that 
general  results  had  been  eminently  satisfactory.  And  upon  such 
knowledge  they  acted. 

There  is  other  general  evidence  of  the  same  presumptive  character. 
As  in  foreign  lands,  so  in  America  there  has  been  never  a  voice  raised 
for  the  repeal  of  the  statutes.  Rather  the  tendency  of  legislation 
everywhere  has  been  to  go  farther,  to  strengthen  and  improve  the 
first  laws.  The  field  of  the  acts  has  been  broadened  somewhat  by 
the  inclusion  of  additional  workmen.  Rates  of  compensation  have 
been  increased  in  various  ways — by  higher  percentile  ratings  upon 
wages,  by  raising  the  fixed  maxima,  by  shortening  the  waiting  periods, 
by  extending  the  duration  of  the  payments,  by  more  liberal  provisions 
for  medical  care,  and  in  still  other  minor  ways.  The  original  limita- 
tion to  accidental  injuries  has  been  done  away  in  a  few  states.^  The 
certainty  of  payments  to  injured  employees  has  been  made  greater 
by  stricter  requirements  of  insurance  and  by  corrections  of  adminis- 
trative procedure.  And  the  simpler  and  more  summary  administra- 
tion by  boards  or  commissions,  rather  than  through  the  courts  of 
law,  has  been  increasingly  favored. 

By  many  tokens  employers  have  shown  their  approval  of  the 
system.  There  are,  to  be  sure,  some  regrettable  failures  of  the 
optional  statutes  to  win  acceptance  by  employers.^  But  these  are 
not  very  numerous,  relatively.  Much  the  larger  numbers  of  the 
employers  affected  have  accepted  their  new  obligations  cheerfully. 
In  the  states  in  which  the  employer's  acceptance  of  the  optional 

^Diseases  now  are  included  in  California,  Connecticut,  Massachusetts,  North 
Dakota,  and  Wisconsin. 

2See  U.S.  Bureau  of  Labor  Statistics,  Bulletin  No.  240  (1918),  p.  34. 


WORKMEN'S  COMPENSATION 


19 


statute  is  presumed,  in  the  absence  of  his  notification  to  the  contrary, 
positive  rejections  have  been  few.  And  in  states  with  optional  stat- 
utes there  have  been  a  great  many  purely  voluntary  elections  of  the 
compensation  system  by  employers  who  have  been  under  no  con- 
straint of  fear  that  they  might  have  to  face  suits  at  law  without  theit 
old-time  common-law  defenses.  So  in  California  in  19 18  there  had 
been  more  than  20,000  such  voluntary  elections  which  had  been 
formally  notified  to  the  Industrial  Accident  Commission,  and  in 
addition  to  these  an  unknown  number  of  others  which  had  been 
legally  implied  by  the  taking  out  of  compensation  insurance.^  And, 
in  fact,  a  good  part  of  the  liberalizing  amendments  to  which  reference 
has  been  made  have  had  the  support  of  employers,  or  even  have  been 
proposed  by  them. 

Employees  have  become  even  more  cordial  than  employers  in  their 
approval.  Unorganized  laborers,  of  course,  on  the  farms  and  else- 
where, never  were  on  record,  or  even  heard,  as  to  their  wishes  about 
workmen's  compensation.  But  organized  laborers,  as  a  rule,  were  at 
first  skeptical  or  positively  hostile.  It  was  but  natural  that  the 
representatives  and  spokesmen  of  the  labor  unions,  knowing  little 
about  the  measures  proposed  for  their  avowed  benefit,  and  by 
outsiders  at  that,  should  be  doubtful  of  the  real  advantage  to  them- 
selves. The  verdicts  for  large  sums  now  and  then  won  in  personal- 
injury  actions  loomed  in  their  minds  as  the  grand  prizes  of  the  lottery 
loom  in  the  minds  of  ticket-holders.  And  they  did  not  appreciate 
fairly  the  fact  that  the  compensation  awards,  limited  although  they 
might  be,  would  come  very  much  oftener  than  the  rich  damage  ver- 
dicts. In  1909  Mr.  Samuel  Gompers,  as  president  of  the  American 
Federation  of  Labor,  declared  his  preference  for  an  improved  em- 
ployers' liability  law.  Two  years  later  the  president  of  the  Con- 
necticut Federation  of  Labor  appeared  in  his  official  capacity  at  a 
legislative  hearing  to  oppose  a  pending  workmen's  compensation  bill, 
announcing  that  the  organized  laborers  of  Connecticut  wished  rather 
a  simple  abolition  of  the  common-law  principle  of  the  fellow  servant. 

^Report  of  the  Commission  for  1917-1918,  p.  6.  Hereafter  in  this  article 
definite  references  usually  will  not  be  cited  for  statements  based  upon  official 
reports  of  the  various  compensation  boards  and  commissions.  In  most  cases 
the  statements  themselves  will  indicate  sufficiently  the  source  of  the  authority, 
the  state,  and  the  year,  and  any  interested  reader  will  find  the  page  without 
difficulty. 


iMiliiflll 


i  'I 


20         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  Illinois  the  opposition  to  early  proposals  of  workmen's  com- 
pensation  had  some  of  its  sharpest,  even  bitterest  expressions  by 
organized  laborers.  But  now,  after  a  few  years  of  experience  with 
compensation,  laborers,  both  organized  and  unorganized  are  gen- 
erally  enthusiastically  in  favor  of  it,  not  necessarily  in  its  present 
tvpical  form  and  with  its  commonest  limitations,  but  certainly  as  a 
general  principle  and  in  contrast  with  employers'  liability  Perhaps 
the  great  railwav  unions,  to  whose  highly  paid  members  the  modest 
maxima  of  the  ordinary  compensation  awards  appear  particularly 
unjust,  are  the  only  important  bodies  of  laborers  who  cannot  be 
considered  as  now  having  renounced  their  former  hostility.  .  .  . 

But  much  more  to  the  point,  under  the  American  system  of  govern- 
ment   is  the  fact  that  the  constitutionality  and  the  general  legal 
proprietv  of  workmen's  compensation  may  be  said  to  be  now  definitely 
established- established,  that  is,  beyond  any  possibility  of  unsettling. 
For  they  have  been  affirmed  abundantly  in  the  highest  courts,  both 
state  and  federal.    Early  unfavorable  decisions  in  Montana,  New 
York,  and  Kentucky,  and  in  lower  courts  elsewhere,  have  been  made 
quite' negligible  by  changes  in  the  provisions  upon  which  they  turned, 
by  constitutional  amendments,^  and  by  the  accumulated  weight  of 
later  favorable  opinions.    Of  these  there  have  been  a  great  many, 
perhaps  fully  half  a  hundred  by  now,  which  may  be  said  to  have 
covered  questions  of  constitutionality,  sustaining  the  statutes  of  more 
than  a  score  of  the  states,  some  of  them  of  the  so-called  optional  type 
and  some  directly  compulsory.'^    It  is  true  that  the  scope  of  some  of 

1  \s  in  New  York,  Ohio,  California,  and  Wyoming.  The  New  York  amend- 
ment of  November  4,  iQU  (Article  I,  Section  19),  is  of  general  interest  in  politi- 
cal science,  as  a  perfect  illustration  of  the  popular  recall,  or  reversal,  of  a  judi- 
cial decision  Both  in  form  and  in  substance  it  is  nothing  else.  It  made  not  a 
word  of  change  in  existing  provisions  of  the  constitution,  but  merely  declared 
in  effect,  that  the  decision  of  the  Court  of  Appeals  in  the  Ives  case -which 
had  annulled  the  compensation  statute  of  igio-was  reversed,  or  '"ecalled.  It 
enacted  simply  that  "  nothing  in  this  constitution  shall  be  construed  to  limit 
the  power  of  the  legislature  to  enact  laws  for"  [compulsory  workmen  s  com- 

^'"optloial :  Illinois,  Iowa,  Kansas,  Louisiana,  Kentucky,  Massachusetts, 
Michigan,  Minnesota,  Montana,  New  Hampshire,  New  Jersey,  Ohio,  Oregon, 
Pennsylvania,  Rhode  Island,  Texas,  West  Virginia,  Wisconsin.  Compulsory  : 
California,  Hawaii,  New  York,  Washington,  Wyoming.  Perhaps  other  states 
should  be  added.  It  would  be  gratuitous,  and  tedious  also,  to  keep  the  list 
up  to  date. 


WORKMEN'S  COMPENSATION 


21 


the  favorable  judicial  opinions  is  not  quite  so  comprehensive  as  at 
times  is  assumed  and  that,  therefore,  their  weight  is  not  quite  so 
overwhelming  as  the  list  of  states  might  indicate.^  But  none  the 
less  it  is  now  entirely  safe  to  conclude  that  no  attack  upon  any  essen- 
tial feature  of  either  optional  or  compulsory  compensation  statutes 
will  prevail  in  the  highest  courts,  whether  state  or  national.  Not- 
withstanding volumes  of  overfine  analysis  and  distinctions,  the  one 
strictly  vital  question  is  whether  an  employer  may  free  himself  from 
the  obligation  to  pay  compensation  by  proving  his  own  freedom  from 
negligence  or  fault.  And  that  he  may  not  claim  such  a  right,  in  the  face 
of  a  statutory  declaration  to  the  contrary,  is  determined  sufficiently 
in  at  least  five  decisions  from  the  Supreme  Court  of  the  United  States,- 
to  say  nothing  of  a  score  or  more  of  cases  in  state  supreme  courts. 

It  therefore  may  be  taken  for  settled  that  henceforward  the  work- 
men's compensation  system  is  to  be  a  part  of  our  industrial  order. 
If  there  were  less  adequate  sanction  for  it  in  definite  principles  of  law, 
strictly  construed,  there  still  would  be  abundant  sanction  in  the  great 
principle — legal,  too,  in  a  sense — which  Justice  Holmes  invoked 
in  191 1  in  his  epoch-making  opinion  in  the  Noble  bank  case.^ 

It  may  be  said  in  a  general  way  that  the  police  power  extends  to 
all  the  great  public  needs.  It  may  be  put  forth  in  aid  of  what  is 
sanctioned  by  usage,  or  held  by  the  prevailing  morality  and  strong 
and  preponderant  opinion  to  be  greatly  and  immediately  necessary 
to  the  public  welfare. 

In  view  of  this  principle,  it  well  might  be  that  a  decisive  con- 
sideration in  favor  of  the  constitutionality  of  the  compensation  acts 
should  be  found  in  that  prompt  and  general  legislative  acceptance  and 
that  present  popular  approval  to  which  attention  has  been  turned. 

^The  early  favorable  decision  in  Wisconsin,  in  the  case  of  Borgnis  et  al. 
V.  Falk  Co.,  147  Wise.  327;  133  N.  W.  209,  has  been  cited  as  authority  in 
nearly  all  of  the  later  decisions  sustaining  the  optional  statutes.  But  the  Wis- 
consin law  does  not  abrogate  the  defense  of  assumed  risks  in  so  far  as  the  risks 
are  "inherent"  or  "necessary."  Accordingly,  the  Falk  decision  cannot  properly 
be  cited  as  authority  for  sustaining  laws  which  do  abrogate  the  doctrine  of 
assumed  risks  completely'. 

^Northern  Pacific  Raihvay  Co.  v.  Meese,  229  U.S.  614;  N.  Y.  C.  R.  R.  Co. 
V.  White,  243  U.  S.  188  ;  Hawkins  v.  Bleakley,  243  U.  S.  210  ;  Mountain  Timber 
Co.  v.  State  of  Washington,  243  U.S.  219;  Middleton  v.  Texas  Power  and 
Light  Co.,  249  U.  S.  152. 

^ Noble  State  Bank  v.  Haskell,  219  U.S.  104,  iii. 


I'tl 


22 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


WORKMEN'S  COMPENSATION 


23 


as  being  the  best  comprehensive  -"-;-  ^,y  ,erve  as 

perhaps  say  the  only  o-s  S"c^^^^^^^^  imputations.  Mr.  Hoffman 
the  basis  for  some  ^"gg^""^/°"°f^j^i  industrial  accidents  a  year 
estimates  that  there  are  some  ^  5^°°^'^'  .  disabling  for  more 

in  the  country  and  abou   700^^^^^^^^^^  ^,„,„,,,,,e  year  .9x3 

than  four  weeks.  In  f^^^^^''^  hoard  had  reports  of  96,382  non- 
_t9U,  the  industr.al  accden  boaj^  ^"^J  ^^^^^^^  ,,,  „ore  than 
fatal  injuries.   Of  these   55, "3  f^^f'^^^  ,ent,  disabled  for 

one  day;  and  of  these,  ^-^'Sr^Z^^'^  durations  of  disabilities 
more  than  four  weeks.   «  */  f^'J"  ,,  ^  whole,  then  we  have 

as  in  Massachusetts  hold  for  the  co"nuy  ^^^ 

each  year  some  3,355,8oo  -^fl^jX^'J,:7.^n.Ue  accidents. 
„,ore  than  one  day  and  no  ^^^  *^"  5^^°;°j,,  g^and  totals  of  corn- 
There  have  been  no  attempts  to^um  up         g       .^  ^  ^^^^^  ^^^ 
pensation  awards  for  all  of  the  ^^ates-^o  ^^^^^.^^ 

Lessary  effort  to  do  -  J^^J*    /^S:  li  data  that  items  are 
are  such  changes  of  method  n  the  prese  ^^  ^^^^^.^ 

of  varied  or  uncertain  -g-tonc-        "-^^  ^^.^     unfortunately, 
typical  figures  from  several  of  the  '^tes,  hg  ^^^  ^^^^  ^^^^_ 

are  not  generally  or  doseb-co^^^^^^^^^  ^„,j  j„„,  3,,  ,,.8, 

fits  actually  pa.d  from  the  be.m  ^^  ^^^  ^^^_^^^^^ 

had  amounted  to  S5,i44,ooo,  in  The  losses  reported 

medical  care,  making  thus  a  total  of  $6,9  7,°°-   T^  ^j    ;„;, 

under    the    comprehensive    '"^"f "«?"_,,, g    In  California 

amounted  to  ^^'^'^f  ^'";t:sa^^3"  ooo'fr  m    anuary  r,  :9U, 
there  had  been  awards  of  at  least  $3,370,°  _^^^g 

to  December  31,   '9-7-   In  Ontario  in  the  y  ^^^ 

^eK  awnrH^  to  the  amount  of  5?9»332,524^  ^^^'^^ 
there  were  -sh  aw^  ds    °  t  ^^^^^^^^  .„  ,j,^  a.^^  six  year. 

provision  of  medical  care.  ^^  1,0,253,000  in  cash  and 

of  compensation  there  were  a  ^^^^ 

medical  care.   In  the  first  three  and  a  half  years  ot 
law  benefits  to  workmen  whose  employers  ^«%"°'  "/^^Z 
own  risks,  about  85  per  cent  of  all,  amounted  to  «36,6  '  000^ 

> Paragraph  inserted  fro.  same  author  in  U.S.  Bureau  of  Labor  StaUsfcs, 
Bulletin  No.  212  (1916),  PP-  359-377- 


Large  as  these  figures  are,  they  become  more  impressive  when  it 
is  noted  that  in  each  case  the  periods  covered  include  the  first  years 
of  compensation  experience,  when  a  number  of  conditions  combine 
to  keep  pavments,  and  even  awards,  far  below  the  heights  to  which 
they  naturally  soon  must  rise.    After  a  few  more  years  of  experi- 
ence the  amounts  of  the  benefits  will  be  much  greater  than  they  are 
now.    So,  of  the  total  of  $9,332,500  awarded  in  Ontario  in  four  years 
no  less  than  $3,5i4,6oo  belongs  to  the  one  year  1918,  when  medical 
care  to  the  amount  of  $370,000  was  also  provided.    In  Pennsylvania 
ini9i7   the  second  year  of  compensation,  benefits  paid  and  awarded 
amounted  to  $7,161,000,  while  the  figure  for  the  next  year  was  $11,- 
640000.     In  Illinois,  in  the  single  year  191 7,  cash  benefits  to  the 
amount  of  $4,906,000  were  paid.    And  of  the  $20,250,000  awarded 
in  Massachusetts  in  six  years  $4,647^500  was  for  the  latest  year  re- 
ported upon,  19 1 8.  r    1    • 
Yet  even  in  Massachusetts  the  awards  are  still  far  short  of  their 
normal  maximum.    Even  if  there  should  be  no  increase  in  the  number 
of  injuries  or  in  the  scales  of  benefits,  and  if  workers  already  have 
learned  fully  about  the  law  and  never  neglect  to  claim  their  rights 
under  it,  the  maximum  cannot  be  reached  until  after  1924.    For  it 
was  in  1 9 14  that  the  term  for  the  payments  of  benefits  for  fatal  in- 
juries was  extended  to  500  weeks,  approximately  ten  years.    And  so 
it  is  in  other  states.    Since  there  are  many  states  which  allow  500 
weeks  or  ten  years  of  payments  for  death  and  permanent  disability, 
as  well  as  a  number  which  continue    payments  on  account  of  these 
same  injuries  during  the  life  of  the  beneficiary,  it  is  clear  that  it  must 
be  a  great  many  years  before  the  stoppage  of  payments  which  will 
have  run  their  full  term  will  balance  the  payments  which  will  be 
starting  anew.    But  all  influences  must  be  counted  at  their  true 
weight*^  So  far  as  the  sums  paid  on  awards  may  be  increased  by  the 
growth  of  industry  and  its  personnel  or  by  a  rise  of  wages  pari  passu 
with  general  prices,  there  may  be  no  change  either  in  the  real  value 
of  the  benefits  for  those  who  receive  them  or  in  the  real  burden  which 
the  awards  place  upon  industry.    But  so  far  as  injuries  may  become 
more  frequent  or  more  serious  through  the  introduction  of  more 
powerful  or  more  rapid  machinery  or  through  the  taking  on  of  new 
and  untrained  operatives,  or  so  far  as  workers  may  seize  more  fully 
the  advantages  which  the  laws  offer  them  or  even  may  lean  more 


24         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

1-    1        oe  fViPv  annear  to  have  done  in  certain  Eu- 

^;-::^Sie  r  .?I^  S...  ..e  .  ..e  .  ^^^^^^^ 

CylrZpZ  too,  that  the  laws  will  be  made  more  compreh^v 
1  not  only  will  be  extended  to  the  few  states  which  now  do  not  hav 

them  but  everywhere  will  come  to  cover  workers  more  generally^  B 
them,  but  every  ^  ^^^  ^^^^^^^^  ^j,^^,^, 

Terer'  om   to  m7e  moreTiber;i  allowances  than  had  been  developed 
nXsSusetts  in  .,.8,  the  total  for  all  of  the  states  wou     be  n 
far  from  $125,000,000  or  $150,000,000  a  year.   If   he  experience  o 
Penns^^^^^^^^^  New  York  be  taken  as  an  indication  of  what  is  to 

come,  the  figures  must  be  placed  higher,  P^^^P^^^^^^^^^^^ 

Such  sums  for  a  probable  future  are  truly  enormous.    But  wnen 
the  amounts  now  paH  out  or  likely  soon  to  be  paid  o^t^a  few  o^^^^^^^^^^^ 
eral  millions  yearly  in  a  single  large  state  and  a  few  ^^n^reds 
thousands  or  even  less  in  smaller  states,  are  -eraged  over  Oi^^^^^^^^^ 
numbers  of  beneficiaries  they  do  not  appear  large.    For  it  must  no 
b™  rg  ttl  that  a  great  many  persons  are  the  victims  of  indu^^^^^^ 
accidents  each  year.    Thus  the  total  payments  in  ^^  ™-^^^^^^^ 
practicallv  the  whole  of  her  compensation  -P^^^^'  ^^J'^^^ 
tember  i,'  iQU,  to  June  30,  1918,  reduce  to  about  an  even  Si 00  for 
eaTh  compensated  injury,  cash  benefits  and  medical  care  both  included^ 
Other  states  show  rather  lower  average  figures.    In  C.Uforma  in    96 
the  average  payment  in  all  compensated  cases  was  ^93^-.   In  lo^^^^^ 
total  benefits  averaged  $63.71  in  iQi?  and  $9046  m  1918.   In  Massa 
chu  etts  during  the  first  five  years  of  the  law  the  average  costs 
per  case  for  all  payments,  as  actually  made  and  estimated  to  be 
outstanding,  were:  1913.  ^40-53;    iQU,  ^43-58;    iQi.-   ^43-0^^ 

■thrifSr.''.  .h.  s-^e  .......  ch.™...r  „  n.,  .e^ 

instructive.  They  are  not  fairly  comparable  one  with  anc>then  Th^ 
run  in  terms  of  a  vague  general  average  of  widely  different  par 
ticulars-  and  thev  are  affected  in  many  ways  by  the  situations  in  the 
several  states.  The  more  recent  the  institution  of  the  compensation 
system  the  wider  the  difference  between  awards  and  actual  payments 
And  the  provisions  of  the  statutes  vary  so  widely,  as  to  ratings  of 
iLudwig  Bernhard,  Unerwiinschtc  Folgen  der  deutschen  SozialpoUtik. 


WORKMEN'S  COMPENSATION 


25 


awards,  extent  of  medical  care,  duration  of  payments,  and  so  on,  that 
general  averages  yield  no  real  information  as  to  what  compensations 
are  received  for  definite  injuries  under  definite  conditions. 

It  is  somewhat  more  instructive  to  consider  the  awards  made  for 
specific  injuries,  of  which  the  practical  consequences  may  be  under- 
stood readily.  For  fatal  injuries  the  average  award  made  in  Connec- 
ticut in  1915  was  $2269.  In  Illinois  in  the  same  year  awards  for  the 
same  injury  averaged  almost  exactly  the  same — $2 2 73.  In  Cali- 
fornia the  awards  averaged  S2445  in  1917  and  $2625  in  1918.  In 
Pennsylvania  for  1916,  1917,  and  1918  the  figures  were  $2383,  S2272, 
and  $2659.  In  the  first  year  of  the  New  York  law,  awards  for  fatal 
injuries  averaged  $3241.  In  Oregon,  in  the  two-year  period  191 5- 
1917,  the  awards,  where  there  were  dependents,  averaged  $5752.  In 
Massachusetts,  for  the  first  five  years  the  figures  were  $1367,  $1781, 
$2970,  $2603,  and  S2631.  In  Ohio  in  1915  the  amount  was  S3098. 
Perhaps  it  will  be  accurate  enough  to  put  the  general  average  for  all 
of  the  states  at  about  S3000,  or  something  less. 

The  payment  of  from  $2500  to  S3000  is  manifestly  inadequate 
compensation  for  the  death  of  a  breadwinner.    None  can  deny  that. 
But  it  must  be  remembered  that  the  purpose  of  the  statutes  never  yet 
has  been  to  make  full  compensation  for  the  pecuniary  losses  due  to 
injuries.    The  pertinent  question  is  whether  such  amounts,  painfully 
inadequate  as  they  are,  are  not  greater  than  the  amounts  paid  and  re- 
ceived on  account  of  the  death  of  industrial  workers  before  the  com- 
pensation system  was  introduced.    And,  in  this  connection,  it  will  not 
do  to  raise  for  comparison  the  sums  awarded  by  way  of  damages  in 
suits  at  law.    Probably  such  damages  did  amount  to  considerably 
more  than  $3000,  on  an  average.    But  they  came  only  after  pro- 
tracted and  expensive  litigation,  so  that  their  net  amounts  for  suc- 
cessful litigants  should  be  reduced  much  for  purposes  of  comparison 
with  present  compensation  awards,  which  are  made  more  promptly 
and  with  only  trifling  cost  to  the  beneficiary,  or  none  at  all.    When 
due  allowances  have  been  made  for  direct  and  indirect  costs  of  liti- 
gation, a  $3000  verdict,  or  even  S5000  or  $10,000,  becomes  a  much 
smaller  thing  than  at  first  it  appears  to  be.    But  even  more  important 
is  the  sad  fact  that,  when  employees  were  killed  at  their  tasks,  suits 
at  law  were  not  always  brought  and  pushed  to  a  successful  issue.    In 
a  great  majority  of  the  cases  no  suit  was  brought.   And  such  suits  as 


26         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

were  brought  were  not  always  won  by  the  plaintiffs.  For  much  the 
larger  number  of  fatal  injuries  there  was  either  no  payment  at  all  or 
only  such  payment,  large  or  small,  as  the  employer  might  feel  in- 
clined to  offer.  And  in  all  too  many  cases  he  felt  inclmed  to  offer 
nothing,  or  only  a  piteously  small  sum. 

For  information  upon  this  unpleasant  subject  there  are  now  no 
more  valuable  data  than  the  figures  presented  by  the  state  commis- 
sions of  inquiry  which  reported  some  ten  years  ago  with  reference  to 
the  desirability  of  enacting  compensation  laws.    These  show  that  m 
great  numbers  of  cases  employers,  even  some  of  the  largest  and  most 
prosperous  of  them,  frequently  neglected  to  make  any  payment  what- 
ever to  the  dependents  of  those  who  had  been  killed  in  their  service. 
In  many  cases  money  was  paid,  but  in  sums  so  petty  as  to  be  little 
better  than  nothing-$5o,  Sioo,  or  perhaps  a  little  more.    Cases  in 
which  the  payments  ran  in  thousands  were  extremely  rare.   It  may  be 
a  not  unfair  sweeping  generalization  to  say  that  under  the  so-called 
liability  laws  payments  of  any  amount  were  not  made  in  more  than  a 
third  of  the  cases  of  fatal  injury  to  employees.   And  the  average  of 
the  sums  actually  paid  would  be  in  the  small  hundreds.    A  careful 
study  has  shown  that  in  Pennsylvania  shortly  before  the  passage  of 
the  compensation  act  the  average  amount  paid  on  account  of  fatal 
injuries  was  $261,^  at  a  time  when  under  the  compensation  laws  of 
Connecticut  and  Ohio  the  corresponding  figures  were  $2269   and 
S3098.    The  next  year  in  Pennsylvania  the  average  compensation 
award  on  account  of  fatal  injuries  was  S2383,  while  in  1918  it  was 
S2659,  a  little  more  than  ten  times  as  much  as  had  been  secured  under 

the  liability  laws. 

There  can  be  no  reasonable  doubt  that  the  compensation  awards 
made  for  fatal  injuries  do  mean  a  large  increase  from  the  petty  and 
uncertain  sums  which  dependents  received  under  the  liability  laws 
The  differences  appear  so  great  in  the  loose  comparisons  which  it  is 
possible  to  make  that,  to  a  complete  certainty,  they  could  not  dis- 
appear after  the  fullest  collation  of  data.  Indeed,  the  differences  now 
apparent  may  quite  as  likely  be  below  the  reality  as  above  it.  And  it 
must  not  be  forgotten  that  such  sums  as  now  are  received  come 
promptly  and  without  appreciable  costs  to  the  recipients.  It  is  true 
that  much  the  greater  number  of  compensation  awards  for  fatal 

HJ.  S.  Bureau  of  Labor  Statistics,  Bulletin  No.  217   (1918),  p.  107. 


n 


WORKMEN^S  COMPENSATION 


27 


injuries,  as  for  other  injuries,  are  paid  in  a  continued  series  of  small 
sums,  not  at  once  in  a  lump,  and  that  in  so  far  the  awards  must  be 
discounted  for  purposes  of  close  comparison  with  the  payments 
made  in  full  at  one  time  under  the  old  order.  But  again  the  differ- 
ence in  amounts  is  so  much  in  favor  of  the  compensation  awards  that 
a  full  discounting  of  them  could  not  bring  them  down  to  or  near  the 
level  of  the  liability  payments.  It  might,  indeed,  not  be  unreasonable 
to  maintain  that,  on  the  whole,  the  series  of  continued  small  pay- 
ments are  the  better  arrangement  for  beneficiaries.  That,  at  least,  has 
been  the  judgment  of  those  who  made  the  compensation  laws. 

An  examination  of  the  compensation  awards  for  nonfatal  injuries 
leads  to  similar  conclusions.  In  Pennsylvania  the  awards  for  the 
loss  of  an  eye  in  the  three  years  19 16-19 18  were  $959,  $1065,  and 
$1198.  In  Wisconsin  in  the  four  years  1914-1918  the  cash  awards, 
aside  from  medical  care,  for  the  loss  of  an  eye  were  S990,  $1033, 
$1033,  and  $1078.  In  California  in  191 7,  the  first  year  with  relevant 
reports,  the  average  award  for  the  loss  of  an  eye  was  $1137.  These 
figures  too  are  pathetically  small.  But  unquestionably  they  show 
payments  much  greater  than  were  made  for  the  loss  of  an  eye  before 
the  days  of  workmen's  compensation. 

If  it  be  true  that  the  compensation  system  has  meant  the  payment 
of  much  larger  sums  to  those  who  have  suffered  from  industrial  acci- 
dents, it  should  be  quite  safe  to  infer  at  once  that  injured  workers 
and  their  dependents  have  been  made  much  better  off.  There  is,  of 
course,  a  possibility  that  in  a  given  case  the  compensation  award 
may  prove  of  little  real  advantage  to  the  recipient,  or  of  no  advantage 
at  all.  But  such  cases  must  be  so  very  exceptional  that  they  need  not 
be  considered.  It  is,  therefore,  almost  a  work  of  supererogation  to 
show  in  definite  detail  that  recipients  actually  have  been  benefited. 
Yet  this  has  been  done.  A  painstaking  study,  carried  out  under  the 
United  States  Bureau  of  Labor  Statistics,  has  traced  the  uses  and 
consequences  of  the  compensation  awards  in  a  number  of  concrete 
cases. ^  And  the  results  are  exactly  such  as  were  to  be  anticipated. 
It  appears  that  in  Connecticut  and  Ohio  there  was  an  unmistakable 
effect  in  preserving  family  life  for  the  dependents  of  those  who  had 

1"  Effect  of  Workmen's  Compensation  Laws  in  Diminishing  the  Necessity  of 
Industrial  Employment  of  Women  and  Children,"  U.  S.  Bureau  of  Labor  Statistics, 
Bulletin  No.  217  (1918). 


I 


; 


28  TRADE  UNIONISM  AND  LABOR  PROBLEMS 
been  killed  or  permanently  disabled.  Children  were  enabled  to  con- 
tinue at  school.  Mothers  were  enabled  to  remain  in  their  normal  re- 
lations to  their  families.  The  Ohio  Industrial  Commission  has  issued 
a  bulletin  devoted  wholly  to  showing  the  uses  made  of  lump-sum  P^^^^ 
ments  on  account  of  death  and  permanent  disabilities.  The  bulletin 
is  illustrated  profusely.  And  the  pictures  of  tidy  little  homes  bought 
and  of  modest  business  places  established  with  the  lump  sums 
bring  one  almost  to  the  point  of  declaring  it  a  happy  fate  for  an  Ohio 
woman  to  lose  her  husband  by  an  industrial  accident  . 

If  the  compensation  system  has  increased  severalfold  the  pittances 
which  formerly  were  paid  to  the  victims  of  industrial  accidents,  that 
in  itself  is  enough  to  justify  the  system  fully.    But  workmen  s  com- 
pensation laws  may  have  far  more  beneficent  effects  than  can  be  seen 
in  the  payment  of  any  awards  for  injuries,  however  liberal  these  may 
be     It  is  vastly  better  to  prevent  disablement,  maiming,  and  death 
than  to  provide  even  the  most  generous  allowances  to  the  injured 
and  to  the  dependents  of  the  slain.    And,  while  in  the  years  of  agita- 
tion for  workmen's  compensation  perhaps  the  greatest  stress  ordi- 
narily was  laid  upon  the  assurance  of  pecuniary  indemmfications  for 
injuries  suffered,  few  American  advocates  of  the  compensation  bills 
failed  to  claim  that  the  proposed  measures  might  be  expected  to  re- 
duce the  numbers  of  accidents.    Indeed,  it  would  be  unfair  not  to 
allow  that  the  more  earnest  advocates  were  always  fully  aware  of  the 
possibilities  of  accident  prevention  which  lay  in  their  proposals. 
If  they  did  emphasize  the  other  consideration,  probably  it  was  be- 
cause of  a  well-grounded  conviction  that  there  was  more  persuasive 
ar-ument  in  it.    To  state  results  which  must  follow  at  once,  directly 
and  in  definitelv  measurable  magnitudes,  was  likely  to  be  more  ef- 
fective argument   than   to   make   claims   which,   in   the   nature   of 
the  case,  it  would  be  impossible  to  prove,  at  least  to  the  conviction  of 
an  interested  doubter. 

And  it  is  not  seriously  to  be  questioned  that  already  the  American 
compensation  laws  have  benefited  workmen,  and  other  classes 
as  well,  much  more  by  stimulating  intelligent  and  successful  cam- 
paigns for  industrial  safety  than  by  adding  some  millions  to  the 
yearly  payments  on  account  of  accidents  which  have  happened.  .  .  . 
Some  of  the  largest  of  American  employers  and  many  of  the 
smaller  ones  had  well-organized  plans  and  agencies  for  the  reduction 


WORKMEN^S  COMPENSATION 


29 


of  accidents  among  their  employees.  And  results  were  developing, 
as  appears  from  several  reports  of  undeniable  significance.  Statis- 
tics of  the  safety  movement  in  the  iron  and  steel  industry  and  in 
machine  making,  which  have  been  published  by  the  United  States 
Bureau  of  Labor  Statistics,^  show  reductions  of  accident  frequency 
and  severity  more  rapid  before  there  were  any  American  compensa- 
tion laws  than  later.  Substantially  similar  is  the  lesson  from  the  coal- 
mining industry,  as  its  figures  have  been  prepared  by  the  United 
States  Bureau  of  Mines.  .  .  . 

But  more  might  be  said.  It  would  be  ungracious  now,  when 
American  employers  are  so  hearty  in  their  support  of  compensation, 
to  attempt  to  say  how  many  of  them  there  are  who  were  induced  to 
begin  or  to  quicken  their  efforts  for  the  safety  of  their  workpeople 
simply  and  solely  by  the  fact  that  the  new  compensation  laws  made 
accidents  expensive  for  the  business,  or  more  expensive  than  before. 
Moreover,  such  an  attempt  would  fail  of  any  definite  success.  And 
so  this  unpleasant  topic  may  be  dismissed  with  the  brief  but  confident 
statement  that  there  were  many  such  employers.  Of  this  all  are 
convinced  who  have  watched  closely  the  bringing  in  of  the  com- 
pensation statutes  in  one  or  more  of  the  states.  There  was  sinister 
significance  in  the  objections  which  employers  raised  against  any 
compensation  enactments,  in  their  strong  efforts  to  weaken  the  pro- 
visions of  bills  which  promised  to  become  laws  or  to  prevent  the 
inclusion  of  themselves  under  them,  and  in  their  panic  eagerness  for 
the  adoption  of  safety  measures  and  appliances  as  the  laws  went 
into  effect.  There  is,  therefore,  no  doubt  whatever  that  in  the 
directest  possible  way  the  compensation  laws  have  conduced  to  the 
promotion  of  safety  policies,  and  thus  to  the  saving  of  life  and  limb, 
by  exacting  more  money  from  employers  in  whose  service  injuries 
are  suffered. 

It  is  not  possible  to  reach  any  safe  conclusion  as  to  the  actual 
effects  of  the  compensation  movement,  or  the  compensation  statutes, 
in  the  promotion  of  industrial  safety  by  a  superficial  reading  of  the 
general  statistics  of  accidents  during  the  few  years  since  the  Amer- 
ican laws  have  been  in  force.  Perhaps  it  will  be  impossible  to  reach 
any  such  conclusion  of  general  validity  by  any  use  of  the  current 
statistics.    For  the  influences  which  the  compensation  laws  must  be 

1  As  in  its  Bulletins  Nos.  234  and  216. 


30         TRADE  UNIONISM  AND  LABOR  -PROBLEMS 
nresumed  to  have  exercised  have  been  blended  with  other  influences. 
As  in  Europe  in  earlier  years,  so  now  in  the  United  States  the  com- 
pensation laws,  with  their  requirement  of  a  return  of  industrial  ac- 
cidents and  with  their  promise  of  money  to  the  injured,  n.ust  tend 
for  years  to  increase  the  returns  of  accidents,  even  while  there  may 
be  no  increase  of  actual  numbers.    And  nobody  knows  how  important 
this  consideration  is  or  how  long  it  will  continue  to  be  important 
Acrain   there  were,  as  has  been  seen  above,  unmistakable  downward 
trends  in  the  American  accident  rates,  at  least  in  certain  important 
industries,  before  the  era  of  compensation.    And  nobody  can  tell 
how  much  of  a  later  decline  might  be  merely  a  continuance  of  this 
early  movement.    Still  further,  large  account  must  be  taken  of  the 
industrial  conditions  brought  in  by  the  great  war.    An  influence  in 
modern  times  always  making  for  higher  accident  rates  is  in  the 
technical  progress  and  the  expansion  of  industries  generally.    The 
appliances  of  modern  industry  are  ever  becoming  vaster  and  more 
powerful,  and  their  speed  is  ever  faster.    The  tension  is  ever  higher 
The  labor  force  is  ever  being  augmented  by  the  taking  on  of  new  and 
untrained  operatives.    And  all  of  these  conditions  and  tendencies 
have  been  found  in  abnormal  degree  in  American  industry  during 
these  past  four  or  five  years,  while  the  compensation  laws  have  been 

taking  effect. 

WTiile  then,  there  has  been  of  late  years  one  large  force  (the  gen- 
eral safe'ty  movement  developed  under  the  compensation  laws  and 
independently  of  them)  making  for  greater  safety  in  American  in- 
dustry or  for  an  appearance  of  it,  as  reflected  in  the  statistical  returns 
of  accidents,  there  have  been  two  making  in  the  opposite  direction 
(the  progress  and  expansion  of  industry  and  the  fuller  reports  which 
the  compensation  laws  secure).    Accordingly,  there  is  nothing  sur- 
prising in  the  fact  that  nearly  all  state  reports  show  larger  and 
larger  numbers  of  accidents  and  probably  would  show  also  an  increas- 
ing rate  of  accident  frequency  if  the  figures  were  all  presented  in 
such  manner  as  to  reveal  the  true  situation.   Nor  is  there  anything 
highly  instructive  in  this  same  fact,  at  least  there  is  not  anything  def- 
initely instructive  as  to  the  effect  of  compensation  laws  upon  accident 
frequency  or  severity.    It  is,  indeed,  rather  disconcerting,  at  first 
glance,  to  read  that  the  accidents  reported  to  the  ISIassachusetts 
Industrial  Accident  Board  rose  from  90,631  in  1912-1913,  the  first 


WORKMEN'S  COMPENSATION 


31 


year,  to  174,372  in  1916-1917,  and  that  corresponding  figures  for 
Maryland  rose  from  20,348  in  191 5  to  42,570  in  1918,  for  West 
Virginia  from  11,418  in  19 13  to  24,379  in  19 18,  for  Washington 
from  11,896  in  19 13  to  27,306  in  19 18,  and  in  New  York  from 
225,391  in  1915  to  286,871  in  1918.  But  these  typical  increases 
are  explained  easily  by  a  reference  to  the  familiar  forces  mentioned 
just  above,  and  most  largely  by  the  industrial  conditions  of  the  war 
period.  So  in  Massachusetts  the  rise  in  the  number  of  reported 
accidents  was  surprisingly  small  until  the  war  began  to  show  its 
influence.  The  increase  was  only  from  90,631  to  95,769  between 
1912-1913  and  1914-1915,  or  less  than  6  per  cent;  whereas  in  the 
next  two  years  there  was  an  increase  of  more  than  80  per  cent. 
In  Washington  the  increase  from  1912  to  1915  was  only  from  11,896 
to  13,162  ;  whereas  in  the  following  three  years  the  accidents  more 
than  doubled. 

Indeed,  it  is  reasonably  clear,  where  careful  and  comparable  re- 
turns of  accident  frequency  are  to  be  had  for  a  term  of  years,  that 
the  campaigns  for  safety  have  had  their  natural  influence  uninter- 
ruptedly throughout  these  latest  years  of  unprecedented  industrial 
activity.  There  are  important  branches  of  American  industry,  not  un- 
affected by  war  conditions,  in  which  some  influence — presumptively 
the  general  movement  for  safety — has  been  operating  continuously 
against  the  unfavorable  influences  arising  out  of  the  war  and  finally 
has  overcome  them.  This  pleasant  truth  may  be  read  in  the  table  on 
page  32  showing  total  accident  frequencies  per  1000  three-hundred-day 
workers  in  certain  plants  or  industries. 

That  the  tendency  toward  a  lower  accident  rate,  where  this  is 
to  be  observed,  has  been  due  mainly  if  not  entirely  to  the  efforts 
of  employers,  the  employed,  the  insurance  companies,  and  the  pub- 
lic authorities  to  promote  industrial  safety  is  not  difficult  of  proof. 
But  the  proof  is  not  to  be  found  in  general  accident  statistics, 
which  at  their  best  can  but  show  the  joint  effect  of  several  com- 
bined forces.  It  is  to  be  seen  rather  in  the  a  priori  certainty  that 
to  cover  dangerous  machinery  and  in  a  thousand  other  ways  to 
fence  against  the  ascertained  cause  of  accidents  must  make  for 
safety,  and  in  the  records  of  a  great  number  of  individual  employers. 
The  records  of  certain  few  very  large  corporations,  as  the  United 
States  Steel  Corporation  and  the  International  Harvester  Company 


1 

f 

4 
\ 

t 

/ 

f 

[  > 

-^2 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


WORKMEN'S  COMPENSATION 


33 


.p 


Ybar 


1' 


1905  ■ 

1906  . 

1907 
1 90S 
1909 
1910 
1911 
1912 

1913 
1914 

1915 
1 9 16 

1917 

1918 


300 
214 
1 89 
150 
174 

134 
I  12 

«53 

' '  5 
74 
4S 

96 

85 


242 


1S4 

1"  1 
192 
.56 

'13 

1 1 1 

101 

Si 


3» 


175 
126 

125 

>37 
104 

87 


6.19 
5-45 

5-3' 
4.97 

4.46 

4.70 

4.66 

4-44 
3-94 
425 


(if  it  be  not  invidious  to  cite  employers  who  are  conspicuous  rather 
for  size  than  for  any  superiority  of  their  plans  or  motives),  have 
become  a  part  of  the  world's  best-known  economic  data.    But  there 
are  many  smaller  employers  who  have  records  quite  as  creditable. 
It  is  not' profitable  to  elaborate  the  obvious.    And  if  anyone  doubts 
the  efficiency  of  well-organized  and  persistent  efforts  after  industrial 
safety,  he  may  find  most  impressive  evidence  in  the  records  of  es- 
tablishments with  safety  appliances  and  in  organizations  and  estab- 
lishments without  them.    In  iron  and  steel  mills  of  three  groups 
the  total  accident  frequency,  per  1000  three-hundred-day  workers, 
was  found  to  be  167. i,  272.4,  and  507.9,  according  as  the  plants 
had  safety  svstems  fully  developed,  in  course  of  development,  or 
not   developed   at   all.-     In   machine-building   plants   the   accident 
frequency  was  found  to  differ  as  follows  in  three  groups  of  plants, 
according  as  there  was  or  was  not  a  good  safety  organization: 

1  Column  I  represents  one  large  steel  mill  with  from  4575  to  10,862  employees, 
and  column  2  represents  a  group  of  smaller  steel  mills  with  from  27,632  to 
108004  employees.  Both  of  these  sets  of  figures  are  from  the  U.S.  Bureau  ot 
Labor  Statistics,  Bulletin  No.  234,  PP-  i5-i6.  Column  3  represents  iron  and 
steel  mills  amounting  to  about  half  of  the  industry  in  the  United  States,  and 
the  data  are  from  the  U.  S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Rev.iew 
Vol.  VIII,  No.  6  (1019),  p.  234-  Column  4  shows  fatal  accidents  only  m  coal 
mining,  as  reported  by  the  U.  S.  Bureau  of  Mines. 

2U.S.  Bureau  of  Labor  Statistics,  Bulletin  No.  234  (1918),  p.  204. 


electrical  apparatus,  65.1   v.   185.6;   locomotive  engines  and  other 
engines,  119.5  v.  141. 7;  machine  tools,  42.1  v.  123.4.^   .  .  . 

The  compensation  movement,  if  not  in  every  state  the  very  com- 
pensation acts  themselves,  is  providing  a  highly  important  form  of 
practical  education.  It  is  giving  us  our  first  real  and  exact  knowledge 
about  industrial  accidents  in  the  United  States.  Before  the  era  of 
the  compensation  laws  there  was  not  a  single  state  in  the  country 
whose  accident  statistics  were  of  any  real  value.  It  is,  indeed,  in- 
teresting to  observe  that  the  broad,  general  estimates  of  the  total 
numbers  of  industrial  injuries  in  this  country  which  had  been  made  in 
recent  years  are  being  substantially  confirmed  by  the  increasingly 
full  and  reliable  returns  which  now  are  coming  in.  Mr.  F.  L.  Hoff- 
man's well-known  estimate  of  some  25,000  killed  each  year  and 
about  700,000  disabled  for  at  least  four  weeks-  is  finding  substan- 
tial verification  in  the  reports  which  now  are  coming  from  the  com- 
pensation commissions.  The  latest  available  returns  for  several  of 
the  states  show  total  injuries  and  fatalities  as  follows : 


State 

California  (1917)      •     ■  ■ 
Illinois  (1918)      .... 

Maryland  (1918)      .    .  . 

Massachusetts  (1917)  .  . 

New  York  (1918)     .    .  . 

Pennsylvania  (191S)     .  . 

Washington  (1918)      .  . 

West  Virginia  {1918)  .  . 

Total 


Total 

Fatalities 

109,988 

628 

36,432 

492 

42,570 

163 

i74>372 

481 

286,871 

1504 

184,844 

3403 

27,306 

414 

24.379 

548 

886,762 


7(>33 


When  there  was  no  better  authority  for  such  frightful  figures  than 
estimates,  it  was  possible  to  doubt  their  truth.  Many  would  not 
believe  that  American  industry  was  killing  three  workers  every  hour 
of  the  year,  night  and  day,  and  was  wounding  some  millions  an- 
nually ;  but  now  it  is  becoming  more  and  more  difficult  to  deny  the 
facts.  The  reports  of  the  compensation  commissions  are  doing  more 
than  to  give  a  terrible  confirmation  of  early  estimates.  They  give 
also  much  additional  information  as  to  the  nature  of  the  injuries, 

^  U.  S.  Bureau  of  Labor  Statistics,  Bulletin  No.  216  (1917),  p.  43. 
-U.S.  Bureau  of  Labor  Statistics,  Bulletin  No.  155,  p.  6. 


tl 
1 


34         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

..e.  physical  and  social  ^^^^::^Zl  d^^Tn 

the  way  ot  reguianiy,  ,  ,.  .       ^  accident  statistics 

AcadrB^rand  commissions.    And  as  the  standa^  .^s  a. 
„.ore  generally  adopted  for  the  return  of  accident    eP°  '^  'f^  ^^ 
accumulate  a  mass  of  statistical  data  -h>ch  w,  1  be  oMhe  bghe 
value  in  every  way.   These  will  g.ve  the  country  "^^"b.tab      -.de^^^^ 
of  the  reality  and  magnitude  of  one  of  our  greatest  '"dustnal  ev.K 
Then  we  may  trust  that  American  publ.c  opmion  will  no    tolerate 
Iny  neg  ecTof  remedies.    But  the  mass  of  scientific  data  for  wh.ch 
wTare  coming  into  the  debt  of  the  compensation  laws  wll  do  more 
;i  rur/ublic  opimon.    U  wm  P-^^-heonlybas-s   or  sound 
and  hopeful  policies  of  prevention  and  pall.a  .on.     t  ^^H  do  mo^c 
even  than  that:  it  will  help-is  already  helpmg-to  humanize  m 
dustrjand  industrial   relations  by  showing  how  P-fcable  -d 
exnSent  it  is  for  twentieth-century  business  to  adopt  m  its  human 
Xtnf  principles  and  methods  as  well  -sidered  and  as  h.gh^ 
specialized  as  those  which  long  have  been  taken  as  a  matter  of  course 

in  other  relations.  ^  c.^(mxt 

The  effects  of  the  compensation  system  in  the  promotion  of  safety 
are  none  the  less  real  because  the  appeal  to  selfish  and  heartless  em- 
pbvers  is  not  made  directly  in  the  commonest  form  of  statute  but 
ind  rectly  and  through  practices  developed  under  the  statutes.    For, 
^hTthe  most  common  form  of  statute  does  lay  "Pon  ^^^^^^^^^^ 
an  obligation  to  make  payments  on  account  of  ^^^^^^^ental  inju  les 
suffered  in  his  service,  it  also  directs  him  to  insure  his  liabilities,  and 
thus  limits  his  costs  to  the  definite  amount  of  his  insurance  premiums^ 
Accordingly,  it  has  been  said  by  some  that  the  employers  direct 
business  Inducements  to  make  his  work-places  safe  are  diminished 
not  increased.    For  the  moment  this  may  appear  to  be  true.    But 
it  is  not  true.    For  in  connection  with  the  state  funds,  which  often 
are  established  as  agencies  of   insurance,  either  f  ^1"^^^^.  .^^%;^"^ 
Washington,  Ohio,  and  other  states)  or  «P^^«"^\^^^/^^7''^  I^J.  ^^^^ 
in  New  York,  Pennsylvania,  California,  and  elsewhere),  provision 
always  is  made  in  the  statutes  for  at  least  some  partial  adjustment  o 
premiums  to  the  accident  rates  of  the  insured,  either  individually  or 


WORKMEN'S  COMPENSATION 


35 


by  groups.  And  it  cannot  be  doubted  that  the  statutes  and  their 
provisions  for  insurance  have  been  drafted  in  the  reasonable  expecta- 
tion that  private  insurance  carriers  also  would  vary  their  premium 
charges  in  accordance  with  the  same  general  principle. 

And  in  actual  practice  one  of  the  most  interesting  and  gratifying 
developments  under  the  compensation  system  in  America  is  seen  in 
the  careful  and  unremitting  endeavors  of  all  insurers — state  funds, 
insurance  companies,  and  mutual  associations  alike — to  work  out 
a  sound  rule  for  making  premium  rates  depend  in  part  upon  the 
employer's  efforts  or  success  in  safeguarding  his  work -places.  Both 
the  principles  of  discrimination  adopted  and  the  practical  measures 
for  carrying  them  into  effect  vary.  There  are  open  questions  as  to 
the  relative  weights  to  be  assigned  to  the  accident  rates  actually 
developed  in  experience  (experience  rating)  and  to  conformity  to 
prescribed  standards  of  safety  (schedule  rating).  There  are  also  un- 
answered questions  as  to  the  extent  to  which  individual  conditions 
and  experience  may  be  considered  without  departure  from  the  sound 
essential  principle  of  all  insurance ;  that  is,  the  principle  of  pooling 
the  individual  in  the  collective  group  of  the  insured.  It  is  not  neces- 
sary here  to  outline  the  excellent  work  which  has  been  done  by 
numbers  of  very  capable  insurance  experts  in  their  attempts  to  solve 
such  problems.  But  it  must  not  be  forgotten  that  much  of  the  best 
thought  of  the  insurance  companies  and  of  the  compensation  com- 
missions is  devoted  to  the  working  out  of  plans  which  may  combine 
sound  insurance  procedure  with  the  utmost  practicable  allowances  and 
penalties  for  observance  and  neglect  of  approved  safety  measures. 

And  there  are  still  other  ways,  at  least  as  important,  in  which 
compensation  insurance  has  conduced  to  the  safety  of  industrial  em- 
ployees. Once  the  insurer  has  contracted  for  his  premiums,  it  is 
clear  that  he  stands  to  gain  the  more — to  save  the  more  of  the 
premiums  for  his  own  profit — the  more  he  can  reduce  the  accidents 
of  the  insured  below  the  numbers  upon  which  the  premiums  were- 
computed.  And,  at  the  same  time,  he  may  encourage  his  insured 
to  hope  that  a  reduced  accident  rate  will  mean  a  reduced  premium 
for  the  next  policy  period.  Thus  we  find  that,  as  a  matter  of  the 
most  obvious  business  interest,  all  sellers  of  compensation  insurance 
seek  constantly  to  improve  their  risks,  by  inspections,  by  counsels 
of  safety,  and  by  the  preparation  and  urging  of  all  manner  of  safety 


if.i 


.!■ 


36         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

policies  and  appliances.    Very  fortunate,  indeed,  it  is  that  corpo- 
rations with  resources  as  great  as  those  of  the  large  insurance  compa- 
nies  find  it  unmistakably  good  business  to  work  for  the  safeguarding 
of  industry.    Nothing  has  done  more  to  clear  private  sellers  of  com- 
pensation  insurance  from  the  charge  of  heartlessly  exploitmg  human 
misfortune  for  their  own  profit  than  their  intelligent  and  persistent 
endeavors  to  make  work-places  ever  safer.  Nothing  can  be  more 
likelv  to  preserve  for  them  their  present  rights  in  a  large  and  expand- 
ing field  of  enterprise.    At  first  individually,  company  by  cornpany, 
but  more  recentlv  chiefly  through  their  specially  constituted  asso- 
ciations and  bureaus,  and  sometimes  in  friendly  conference  with  repre- 
sentatives of  the  state  compensation  commissions,  private  insurance 
carriers  have  done  a  most  admirable  work  in  devising  and  recom- 
mending plans  for  the  safe  construction,  equipment,  and  management 
of  factories,  mines,  and  other  work-places.    Their  provisions  for  the 
human  element,  that  is,  against  the  so-called  moral  hazards,  are 

scarcely   less   elaborate. 

Whenever,  as  often  under  the  statutes,  those  who  employ  large 
numbers  are  allowed   to  dispense   with   formal    insurance   and   to 
"carry   their   own   risks,"   workmen's   compensation   tends   m   the 
simpfest  and  most  direct  way  to  promote  safety.    In  all  such  cases 
emplovers  know  that  each  injury  means  so  much  direct  cost  to 
themselves  and  that,  therefore,  it  is  for  their  own  immediate  business 
advantage  to  reduce  accidents  to  the  lowest  possible  figures.   Essen- 
tially so  it  is  also  with  all  genuinely  mutual  insurance  associations. 
The  conclusion,  therefore,  is  fully  warranted  that  compensation 
insurance,  with  its  merit  ratings,  does  contribute  largely   to   the 
contemporary-  movements  for  industrial  safety.    And  both  insurance 
and  the  merit  ratings  were  contemplated  in  the  workmen's  com- 
pensation legislation  generally,  even  in  the  states  where  they  were  not 
expressly  required  by  the  statutes.    Here,  then,  is  the  happiest  con- 
sequence of  the  compensation  system.    It  certainly  is  well  if  many 
millions  of  money  have  been  added  to  the  sums  formerly  received 
as   indemnity   and   solace   for   the   losses    and    sufferings   entailed 
upon  workmen's  families  by  industrial  accidents.    But  it  is  rnuch 
better  in  everv  way  if,  as  is  not  unlikely,  some  few  thousands  of 
lives  are  saved  each  year  and  some  scores  or  hundreds  of  thousands 
of  injuries  prevented. 


WORKMEN^S  COMPENSATION 


37 


It  must  be  confessed  that,  except  as  they  did  bring  in  compensa- 
tion insurance  and  its  merit  ratings,  the  compensation  laws  have 
not  done  much  for  industrial  safety.  Not  often  have  they  prescribed 
rules  or  standards  of  safety  or  even  conferred  powers  of  inspection. 
This,  however,  has  been  because  such  matters  have  been  left  to  dis- 
tinct statutes  and  distinct  offices.  In  California  there  was  a  tem- 
porary change  of  policy.  For  the  revised  compensation  act  of  19 13, 
replacing  substantially  the  act  of  191 1,  was  made  up  in  considerable 
part  of  sections  devoted  specifically  and  exclusively  to  the  direct 
promotion  of  safety  in  industry;  and  the  act  itself  was  legally 
designated  the  "Workmen's  Compensation  and  Safety  Act."  But 
in  191 7  the  safety  sections  were  entirely  removed  to  a  separate 
statute.  Other  states,  as  a  rule,  have  followed  the  plan  of  separate 
statutes  from  the  first.  At  present  there  are  only  about  a  dozen 
states  which  make  any  provision  for  accident  prevention  in  their 
compensation  acts.  Doubtless  there  are  real  advantages  in  some 
measure  of  coordination  or  unification  in  the  two  lines  of  activity. 
But  the  present  degree  of  separation  is  not  as  great  as  might 
appear.  For  in  many  of  the  states  there  are  industrial  commissions 
with  general  authority  over  all  administration  of  laws  affecting  labor, 
workmen's  compensation  laws,  factory-inspection  laws,  safety  laws, 
and  the  rest.  And  it  can  make  but  trifling  difference  whether  pub- 
lic regulations  which  a  given  office  is  to  administer  are  found  in 
different  parts  of  one  statute  or  in  different  statutes. 

In  the  critically  important  matter  of  fixing  compensation-insurance 
rates,  whether  for  the  state  funds  or  for  private  insurers,  the 
framers  of  the  statutes  usually  have  thought  it  sufficient  to  take 
account  of  the  actually  developed  accident  experience  of  industries  or 
groups  of  industries.  Rarely  have  they  thought  it  well  to  sanction 
schedule  ratings ;  that  is,  ratings  based  upon  conformity  to  approved 
standards  of  safety.^  The  terms  of  typical  statutes,  as  in  Ohio,  un- 
mistakably contemplate  no  other  principle  of  merit  rating  than  such 
as  may  be  derived  from  the  accident  experience  of  the  insured. 
There  are  statutes,  as  in  Kentucky  and  Virginia,  which  in  general 
terms  authorize  "merit  rating,"  while  others  authorize  or  direct 
"schedule  rating,"  with  or  without  a  fair  implication  that  the  words 

^As  a  matter  of  fact,  legislatures  and  their  draftsmen  knew  very  little 
about  the  different  principles  and  methods  of  iiierit  rating. 


ft 


I 


38         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

are  to  be  taken  in  their  technical  meaning.    Only  in  a  few  of  the 
states  as  ii  Colorado  from  the  first,  in  Michigan,  New  Jersey,  Penn- 
svlvania    and  now  since  1917  in  Washington,  is  there  express  and 
defink     anction  for  the  adjustment  of  premium  -^es  with  reference 
to  physical  and  moral  conditions  in  plants,  as  distmgmshed  from 
accfden    r  tes  revealed  in  experience.    Accordingly,  the  state  com- 
mS  n    practically  limiting  themselves  to  experience  ratings  m  their 
r  nStion  of  the  state  funds,  have  been  much  less  "  ^^^^ 
nrivate  insurers  in  their  use  of  a  most  powerful  force  for  the  promo 
C        ndus^ial  safety.    The  provisions  of  the  P-syWa^^^^^^^^^^^ 
and  of  recent  amendments  in  New  Jersey  and  Washmgton  may 
indicate  that  this  important  fact  is  coming  to  be  recogmzed  m  pubhc 
Dlaces     If  so,  a  change  for  the  better  may  be  m  prospect. 
"^  But    even  without  large  use  of  this  efficacious  means  ^^me  o 
the  site  commissions  have  produced  gratifying  results.   They  have 
conducted  extensive  educational   campaigns ;    they  have  made  in- 
spect"!^^^  examined  and  recommended  safety  devices    established 
safety  exhibitions  and  museums,  and  widely  scattered  helpful  printed 
r^aterials     The    California   Industrial    Accident    Commission   long 
has  issued  a  valuable  illustrated  Calilornia  Sajety  ^^ws^^^^^^ 
not  have  failed  to  do  much  good.   The  same  commission  conducted 
a  special  campaign  for  safety  in  mining  industries,  with  the  appar- 
Lt    e  u  t  that  fatal  accidents  in  California  mining  fell  from  20  m 
X0X6  to  10  in  X917.    In   1914  the  Massachusetts  Industna    Acci- 
dent Board  carried  on  for  three  months  a  campaign  for  safety  in 
establishments   with   some    S5,ooo   employees.   And   a   comparison 
of  accident  rates  for  half-year  periods  before  and  after  the  campaign 
shows  a  reduction  of  20.8  per  cent  in  the  total  number  of  accidents^ 
It  is  by  discriminating  attention  to  experiments  and  reports  like  the 
two  just  mentioned -not  by  observing  the  broad,  genera  movements 
of  accident  rates-that  one  may  come  to  his  best  conclusions  as  to 
the  effects  of  the  compensation  laws  in  making  industry  safer.  .  .  . 
So  far   then,  it  would  appear  that  the  compensation  system  has 
had  no  appreciable  direct  effect  upon  business.   Nor,  in  the  nature 
of  the  case,  can  there  have  been  any  large,  direct  effects.    The 
sinc^le  new  influence  to  work  directly  is  the  weight  of  the  com- 
pensation costs  as  an  addition  to  the  expenses  of  doing  business. 
And    on  the  average,  these  costs  cannot  have  figured  for  much. 


WORKMEN'S  COMPENSATION 


39 


Clearly  their  magnitude  is  shown  by  the  premiums  for  compensation 
insurance.  And  these,  varying  from  a  minor  fraction  of  i  per  cent 
of  the  pay  roll  in  most  textile  mills  to  several  per  cent  in  structural 
iron  work,  mining,  and  other  specially  dangerous  operations,  may 
perhaps  be  generalized  at  about  i  per  cent,  or  a  little  more.^  And 
such  a  cost,  a  cost  of  such  amount  and  of  such  character,  can,  have 
no  great  effect  upon  the  total  expenses  of  producing,  upon  necessary 
prices  of  products,  or  upon  demands  for  goods. 

The  addition  of  i  per  cent  to  labor  costs  becomes  an  addition  of 
about  one  fifth  of  i  per  cent  to  total  costs  when  account  is  taken 
of  the  fact  that  labor,  as  in  manufacturing,  figures  at  about  one  fifth 
of  all  costs.  In  other  industries,  as  in  mining,  labor  counts  for  much 
more.  But  the  costs  of  compensation,  of  compensation  insurance, 
are  not  a  net  addition  to  the  employers'  business  expenses.  Some- 
thing employers  paid  in  former  days  on  account  of  industrial  acci- 
dents. The  largest  item  was  the  amount  paid  for  employers'  liability 
insurance.  But  there  were  other  items  also — the  small  sums  given 
occasionally  in  direct  and  gratuitous  settlements  of  claims,  the  costs 
of  litigation,  and  the  rest.  So  that  the  immediate  net  increase  in 
the  costs  of  production  or  business  must  be  much  less  than  the  present 
costs  of  compensation  insurance.  In  fact,  there  have  been  official 
claims  for  several  of  the  states  that  the  new  system  costs  employers 
no  more  than  the  old.'  Something  still  further  must  be  allowed  in 
reduction  of  the  fair  charge  against  compensation.  Better  medical 
care  for  injured  employees  and  larger  cash  benefits  for  them  make 
the  interruptions  of  their  work  less  prolonged  and  less  disturbing  to 
the  orderly  course  of  the  business. 

When  all  due  allowances  have  been  made  for  these  reactions  of 
the  compensation  system,   as   for   others  which   might   be   added, 

^In  Montana,  where  employments  cannot  be  especially  free  from  dangers, 
1  per  cent  is  the  official  estimate  of  the  costs  for  the  two  years  1917-1918.  In 
West  Virginia,  where  also  mining  is  an  important  industry,  the  general 
average  of  premiums  for  1916-IQ17  was  1.41  per  cent.  In  Wisconsin  during 
1913-1916  it  was  1.33  per  cent.  In  the  exclusive  state  funds  the  premiums  or 
assessments  are  lower.  But  the  question  of  true  costs  is  so  much  involved  with 
other  subordinate  questions  that  it  cannot  be  answered  in  a  convincing  manner 
without  elaborate  expositions  and  discussions.  The  variety  of  Wisconsin  indus- 
tries and  the  different  agencies  of  insurance  operating  in  that  state  perhaps 
make  Wisconsin  figures  as  instructive  as  any. 

2  Montana  Industrial  Accident  Board,  I9i8-(i9i9,  pp.  28-29. 


^l 


iM 


H 


M 


40         TRADE  UNIONISM  AND  LABOR  PROBLEMS 
possibly  there  may  still  appear  some  trifling  increase  in  the  direct 
costs  of  industry.    But  trifling,  indeed,  must  the  mcrease  be    And 
such  as  it  may  be,  it  bears  upon  producers  in  nearly  a  1  branches  o 
industry,  taking  the  word  in  its  narrower  meaning,  and  m  nearly  all 
parts  of  the  dvilized  world.   Its  true  and  final  effects,  therefore, 
can  be  ascertained  only  by  elaborate  and  somewhat  profound  analyses 
and  by  careful  examinations  of  industrial  conditions,  such  as  would 
in  themselves  constitute  an  important  study  in  economic  theory.   Are 
modern  producers'  profits  so  high  that  from  them  can  be  taken  these 
trifling  net  additions  to  costs?    If  not,  will  the  producers'  necessary 
increase  of  his  selling  prices  appear  in  a  corresponding  mcrease  m 
consumers'  costs?    If  so,  will  demand  be  turned  from  the  products 
of  those  who  have  to  pay  compensations  to  the  products  of  those  who 
do  not  have  to  pay,  as  from  manufactured  goods  to  agricultural 
products '    Or  will  consumers  find  their  purchasing  power  commen- 
surate with  the  higher  prices,  because  they  receive  compensation 
benefits    or  are  enabled  to  work  and  earn  better,  or  are  relieved 
somewhat  from  charges  for  the  care  of  victims  of  industrial  acci- 
dents'   These  and  still  remoter  questions  need  not  be  answered 
now    We  may  rest  content  in  a  reasonable  confidence  that,  as  no 
disturbances  because  of  workmen's  compensation  have  been  observed 
in  the  industr>-  of  the  United  States  or  of  foreign  lands,  so  none 
which  can  possibly  come  can  outweigh,  or  even  approximately  bal- 
ance, the  business  and  social  advantages  which  already  have  been 

derived  from  that  same  system.  ,     .  ,  ..        , 

There  are  other  consequences  of  the  compensation  legislation  al- 
ready apparent.   As  it  has  been  humanizing  industry,  so  it  has  been 
humanizing  judicial  opinion,  which  in  America  is  so  powerful  for 
social  good  or  evil.   One  need  not  be  an  extremist  in  order  to  believe 
that  the  great  body  of  our  judicial  reasoning  about  social  relations 
has  been  a  dry  and  lifeless  formalism,  showing  little  recognition  of 
what  it  meant  for  the  life  and  welfare  of  human  beings.    An  eminent 
New  England  jurist,  still  living,  once  declared,  in  a  decision  from 
the  bench    that  the  atrocious  fellow-servant  doctrine  rested  upon 
"considerations  of  right  and  justice.'"    Now  such  a  complete  dis- 
regard of  the  human  significance  of  the  law  never  is  found  in  the 
compensation  decisions.    Rather  the  judges  in  a  score  of  courts  vie 
iHoxie  V.  New  York,  New  Haven,  and  Hartjord  R.  R.  Co.,  82  Conn.  352. 


WORKMEN'S  COMPENSATION 


41 


n 


with  one  another  in  praising  the  humane  wisdom  of  the  compensation 
acts  and  declaring  their  purpose  of  interpreting  them  in  no  narrow 
and  technical  sense,  but  broadly  and  liberally  and  in  such  manner 
as  to  get  the  fullest  practical  effect  to  their  noble  humanitarianism ! 

Let  still  other  observed  consequences  of  the  compensation  system 
be  passed  over  now.  But  mention  must  be  made,  if  only  the  briefest, 
of  certain  serious  defects  in  the  present  statutes,  which  have  devel- 
oped in  practical  experience.  It  would  not  do  to  dwell  only  upon  the 
merits  of  the  American  compensation  system,  with  never  a  word 
about  its  defects.^ 

To  leave  the  enforcement  of  the  injured  worker's  rights  to  the  law 
courts  has  been  proved,  in  New  Jersey  ^  and  elsewhere,  practically 
to  nullify  the  provisions  of  the  statutes  in  great  numbers  of  cases. 
"The  administration  of  American  justice  is  not  impartial,  the  rich 
and  poor  do  not  stand  on  an  equality  before  the  law,  the  traditional 
method  of  providing  justice  has  operated  to  close  the  doors  of  the 
courts  to  the  poor,  and  has  caused  a  gross  denial  of  justice  in  all 
parts  of  the  country  to  millions  of  persons."^  Yet  there  remain  com- 
pensation states,  north,  east,  south,  and  west,  which  have  constituted 
no  special  administrative  boards.  The  sums  paid  under  the  acts  for 
medical  care  have  been  proved  generally  to  be  most  wisely  and 
helpfully  expended,  hastening  cures  and  thus  benefiting  both  the 
injured  and  the  employer.    Yet  there  are  but  four  or  five  states  which 


.H 


1  For  the  most  part  the  defects  may  be  regarded  as  merely  shortcomings,  as 
merely  preventing  a  full  realization  of  the  advantages  which  might  be  derived 
from  a  compensation  system.  But  in  some  few  respects  workmen  have  been 
made  positively  worse  off  by  the  compensation  acts.  As  men  who  have  been 
disabled  or  maimed  are  more  than  ordinarily  liable  to  accident,  such  appear 
to  find  their  opportunities  of  employment  diminished  somewhat  (U.  S.  Bureau 
of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  IX,  No.  i  (1919),  pp.  206- 
207).  More  important  is  the  fact  that  the  compensation  laws,  making  recov- 
eries under  the  employers'  liability  law  practically  impossible,  shut  off  from 
any  relief  the  workers  whose  injuries  are  not  provided  for  by  way  of  com- 
pensation awards;  that  is,  broadly  speaking,  those  whose  disabilities  do  not 
continue  beyond  the  prescribed  waiting  period  —  a  week  or  ten  days,  more  or 
less.  But,  since  most  of  these  many  thousands  would  have  been  unable  to 
secure  relief  under  the  liability  system,  the  evil  is  not  enormous.    But  it  is  real. 

2  "  Three  Years  under  the  New  Jersey  Workmen's  Compensation  Law,"  report 
by  the  American  Association  for  Labor  Legislation. 

•■'"Justice  and  the  Poor,"  Carnegie  Foundation  for  the  Advancement  of 
Teaching,  Bulletin  13,  p.  8. 


t 


I 


42         TRADE  UNIONISM  AND  LABOR  PROBLEMS 
do  not  limit  the  extent  of  provision  for  curative  treatments,  by 
ftxincr  a  maximum  either  of  amount  or  of  time.    The  waitmg  period, 
during  which  no  benefits  accrue,  still  is  two  weeks  in  some  states 
and  ten  days  in  many.    Yet  experience  shows  that  not  far  ^om  three 
fourths  of  all  disabilities  cease  within  two  weeks.    In  Oregon  m 
101^-1017   when  there  was  no  waiting  period,  it  was  found  that  a 
waiting  period  of  one  week  would  have  cut  off  35-38  per  cent  of  the 
injured  from  their  awards,  while  two  weeks  would  have  cut  off  62  per 
cent    While  to  manv  prosperous  persons  it  may  appear  a  small  mat- 
ter to  have  income  suspended  for  two  weeks  or  less,  it  is  by  no 
means  a  small  matter  to  the  hundreds  of  thousands  who  have  the 
experience  each  year  in  this  country  because  they  have  been  injured 
while  at  work.    Failure  of  the  employer  to  insure  his  liabilities  often 
makes  it  impossible  for  the  injured  to  secure  their  promised  benefits. 
Yet  there  still  are  several  states  which  make  no  requirement  of  in- 
surance   The  limitation  of  awards  to  those  whose  injuries  have  been 
of  accidental  origin  has  raised  many  perplexing  questions  as  to  what 
is  an  accident  and  has  cut  off  from  compensation  a  great  many  vic- 
tims of  industrial  diseases  and  of  exposures  of  one  sort  and  another. 
A  defect  deserving  of  special  attention  is  the  inadequacy  of  the 
schedules  of  awards.    About  these  there  is  much  misunderstanding 
The  amounts  of  compensation,  in  nearly  all  cases,  are  stated  as  such 
or  such  a  percentage  of  current  earnings,  as  less  than  50  per  cen 
in  several  states  and  under  certain  conditions,  50  per  cent  in  about 
half  of  the  states,  55  in  two  or  three,  60  in  some  fifteen,  65  m  two 
or  three,  and  66%  in  the  rest.     But  these  figures  exaggerate  the 
benefits  actually  paid,  being  maxima  which  cannot  be  reached  under 
many  common  conditions  of  earnings,  dependence,  and  the  hke. 
Moreover,  they  are  qualified  in  most  of  the  states  by  the  provisions 
that   no  matter  how  high  the  actual  earnings,  the  awards  may  not 
be  above  some  maximum,  as  S12  a  week,  more  or  less,  and  that   no 
matter  how  long  disability  may  continue,  payments  must  cease  after 
a  while    The  Minnesota  commissioner  of  labor  estimates  that  in 
his  state   while  the  nominal  rate  was  60  per  cent,  the  awards  in 
cases  of  temporary  disability  were  but  38  per  cent  of  the  direct  wage 
loss  in  1916-1917  and  but  48  per  cent  in  1917-1918.    It  is  a  cruel 
mockery  to  present  as  half  pay,  or  two  thirds,  a  series  of  payments 
which  may  cease  while  yet  the  injured  person  is  to  live  through  a 


WORKMEN'S  COMPENSATION 


43 


long  period  of  disability.  It  is  scarcely  less  cruel  to  modify  a  nomi- 
nal half  or  two  thirds  of  pay  by  a  fixed  maximum  of  $15,  $12,  $10, 
The  highly  paid  railway  employees  have  understood  this  all 


or 


the  time.  And  nowadays  it  is  being  realized  by  many  others.  To 
what  extent  present  schedules  of  awards  might  be  raised  need  not 
be  asked  here.  ]Most  of  them  were  fixed  before  the  war  period  and 
its  enhanced  costs  of  living;  and  the  present  height  of  prices  has 
forced  a  number  of  increases  in  the  schedules,^  but  not  enough.  They 
still  are  generally  too  low.  It  is  the  amount  actually  paid  that  counts. 
Be  it  remembered  that  actual  awards  for  fatal  injuries  average  from 
$2500  to  $3000,  while  the  terms  of  the  statutes  commonly  put  into 
readers'  minds  thoughts  of  $5000  or  more. 

Much  the  greatest  defect  of  the  American  compensation  statutes 
is  their  lack  of  comprehensiveness.  In  a  recent  issue  of  the  Monthly 
Labor  Review,  Mr.  Carl  Hookstadt  estimated  that  in  the  so-called 
compensation  states  there  were  not  less  than  7,400,000  employees 
who  were  not  covered  at  all  by  the  statutes.  Some  of  these,  a  mil- 
lion and  a  quarter  of  them,  are  in  interstate  commerce,  where  there 
are  special  but  not  insuperable  difficulties  in  providing  coverage. 
But  the  greater  number,  more  than  six  millions,  have  been  deliber- 
ately left  out  or  excluded  by  state  legislatures.  The  reasons  are  well 
known.  There  are  strange  beliefs  as  to  the  needlessness  of  compensa- 
tions in  occupations  which,  with  or  without  good  reasons,  are  counted 
as  not  hazardous.  There  are  rather  discreditable  deferences  to  the 
prejudices  of  such  classes  as  the  farmers.  And  there  are  other  minor 
reasons.  But  the  fact  remains  that  nearly  a  third  of  the  employees 
in  the  so-called  compensation  states  are  in  no  wise  affected  by  the 
statutes.  An  estimate  of  the  United  States  Bureau  of  Labor  Statistics 
indicates  that  nine  of  the  compensation  states  cover  less  than  half  of 
their  employees  and  that  only  eighteen  cover  as  many  as  two  thirds. 
And  these  estimates  assume  that  in  the  states  with  optional  acts  there 
have  been  no  rejections  by  employers. 

The  net  result  of  all  this  is  that  the  present  American  compen- 
sation system  is  much  narrower  in  its  application  than  we  in  our 
optimism  might  suppose.  In  Kansas,  with  her  population  of  more 
than  a  million  and  a  half,  there  were  in  19 14  only  806  compensation 

1 U.  S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  IX,  No.  4 
(1919),  p.  245. 


44         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

awards  of  all  sorts;  while  in  1917-1918,  after  the  waiting  period 
had  been  reduced  from  two  weeks  to  one,  cash  awards  were  made 
only  at  the  rate  of  191 6  a  year.    In  New  Hampshire,  with  a  popula- 
tion of  some  450,000,  there  were  in  1914  but  404  awards;  and  the 
latest  report  of  the  Bureau  of  Labor  makes  no  mention  of  compen- 
sation awards.    In  Nebraska,  with  nearly  a  million  and  a  half  of 
people,  there  were  in  191 5  but  605  awards.    In  the  same  state,  m 
the  calendar  year  1917,  but  $67,028.73  was  paid  for  all  cash  benefits, 
and  in  the  first  ten  months  of  191 8  but  $65,362.74.    Can  such  states 
fairly  be  counted  as  having  compensation  laws?    But  even  in  the 
states  which  make  the  best  showings  only  a  small  minority  of  the 
injuries  suffered  are  followed  by  compensation  awards.    There  are 
few  states  in  which  the  figure  is  as  high  as  20  per  cent.    In  California, 
where  the  compensation  law  had  been  in  operation  five  or  six  years 
and  had  been  administered  by  a  capable  and  alert  commission,  there 
were  in  191 7  only  14,313  awards  for  temporary  disability,  although 
there  were  107,420  temporary  disabilities  reported. 

The  sum  of  it  all  is  that  the  American  compensation  laws  have 
proved  fairly  their  beneficence  but  cannot  be  supposed  to  have 
attained  their  final  forms.  Either  a  superficial  observation  of  the 
contemporary  course  of  legislation  or  a  closer  examination  of  the 
underlying  conditions  which  appear  to  direct  it  will  yield  reasons  for 
believing  that  the  compensation  system  will  be  extended  and  that 
its  provisions  will  be  made  more  liberal  than  they  are  at  present. 

WiLLARD  C.  Fisher 

New  York  Uni\'ersity 


III 


COMPULSORY  HEALTH  INSURANCE  IN 
GREAT  BRITAIN^ 

THE  right  of  a  government  to  coerce  its  citizens  into  insuring  for 
those  contingencies  against  which  experience  has  proved  that 
they  are  unable  to  protect  themselves  has  been  asserted  not  alone  by 
Great  Britain's  Prussian  enemy  and  eight  other  European  nations  but 
by  democratic  and  individualistic  England  herself.  The  presentation 
of  a  bill  for  compulsory  health  insurance  to  the  British  Parliament 
in  191 1  was  the  more  remarkable  since  5,500,000  of  the  more  thrifty 
British  workmen  were  then  voluntarily  insured  against  sickness 
through  friendly  societies  and  trade-unions.  This  voluntary  insur- 
ance, however,  did  not  provide  for  those  who  most  needed  it — the 
less  thrifty,  the  more  poorly  paid,  those  to  whom  sickness  was  a 
greater  disaster — who  are  now  included  within  the  compulsory 
system.  To  these  8,000,000  workers  the  only  assured  protection  was 
that  offered  by  the  charitable  societies  and  the  poor  law,  with  its 
hated  stigma  of  ''pauper."  To  the  British  this  provision  seemed 
wholly  insufficient,  and  under  the  commanding  leadership  of  Lloyd 
George  a  bill  for  compulsory  health  insurance  embracing  all  workers 
was  introduced  into  Parliament  in  May  of  191 1.  It  was  passed  the 
following  December,  came  into  operation  in  July  of  191 2,  and  six 
months  later  benefits  became  payable. 

Included  within  this  "national  health  insurance,"  as  it  is  termed 
in  Great  Britain,  are  all  persons  between  sixteen  and  seventy  em- 
ployed for  remuneration  under  any  form  of  contract,  if  engaged  in 
manual  labor  or  if  the  rate  of  their  annual  earnings  is  less  than  $800.- 
Within  this  classification  numerically  unimportant  exemptions  of 
individuals  or  the  exclusion  of  occupations  may  be  granted  by  the 
commissioners  for  reasons  established  by  the  act.  Untouched  by  its 
compulsory  provisions  are  air  those   working   independently — the 

^From  American  Labor  Legislation  Review,  Vol.  VI  (1916),  pp.  127-137. 
2  The  income  limit  has  been  raised  to  $1250  by  the  amending  act  of  1919. 

45 


f 
■i  1  \ 


46         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

small  shopkeeper,  the  village  carpenter  or  the  cobbler,  all  of  whom 
have  no  emplover  and  whose  insurance  would  be  difficult  to  enforce. 
Those  employed  within  the  meaning  of  the  act  and  insured  durmg  the 
first  year,  1912,  numbered  13,472.000,  or  nearly  30  per  cent  of  the 

total  population.  •  i  j   • 

The  benefits  to  which  these  13,472,000  workers  are  entitled  m- 
elude  medical  care,  sanatorium  treatment  if  attacked  by  tuberculosis, 
a  cash  benefit  at  the  time  of  childbirth,  a  weekly  payment  during 
twenty-six  weeks  of  illness  in  a  year,  and  a  smaller  weekly  sum  dur- 
ing prolonged  disability. 

The  medical  benefit  guaranteed  to  each  person  insured  for  halt  a 
year  consists  of  medical  treatment,  medicines,  and  specified  appli- 
ances.   This  benefit  is  administered  by  insurance  committees,  which 
are  appointed  for  definite  areas  to  represent  insured  persons,  doctors, 
and  the  local  government  of  the  administrative  district.    These  com- 
mittees arrange  for  the  medical  care  of  the  insured  workmen  in 
accordance  with  regulations  of  the  central  administrative  body,  the 
insurance  commission,  and  then  draw  up  a  list  or  '^ panel"  of  physi- 
cians who  have  agreed  to  the  terms.    These  arrangements  must  ob- 
serve two  fundamental  conditions:  first,  the  right  of  every  duly 
qualified  physician  who  wishes  to  serve  upon  the  panel  to  be  placed 
upon  it,  provided  he  is  not  proved  injurious  to  the  service  ;   and, 
second,  the  right  of  each   insured  person  to  select  his  physician 
from  among  those  on  the  panel.    For  the  remuneration  of  physicians 
a  minimum  of  Si. 68  and  a  maximum  of  $1.80  is  annually  set  aside 
for  the  medical  care  of  each  insured  person,  regardless  of  the  amount 
of  medical  attention  he  may  require.    This  sum,  exclusive  of  the 
cost  of  drugs  and  appliances,  is  nearly  twice  the  average  physician's 
income  before  the  insurance  act,  estimated  upon  the  basis  of  per 
capita  of  the  population.     Under   these  conditions   about   20,000 
doctors  in  England,  Scotland,  and  Wales  have  undertaken  insurance 
practice.    This  in  various  districts  represents  from  70  to  100  per  cent 
of  the  medical  profession  practicing  among  the  industrial  population. 
Sanatorium  benefit  for  the  tuberculous  insured  is  provided  through 
the  insurance  committees,  which  make  arrangements  for  sanatorium 
treatment  with  the  local  authorities. 

A  weekly  sick  benefit  for  a  maximum  of  twenty-six  weeks  in  a 
year  is  granted  to  each  insured  person  not  over  seventy  years  of  age 


HEALTH  INSURANCE  IN  GREAT  BRITAIN 


47 


who  has  paid  twenty-six  contributions,  and  who  produces  a  certificate 
from  his  panel  doctor  that  he  is  incapable  of  work.  Ten  shillings 
($2.40)  a  week  for  men  and  seven  shillings  sixpence  ($1.80)  a 
week  for  women  is  the  legally  established  benefit  paid  by  each 
society  approved  under  the  act. 

A  disablement  benefit  of  five  shillings  ($1.20)  a  week  is  paid  to 
both  men  and  women,  insured  for  two  years,  when  the  illness  extends 
beyond  the  twenty -six  weeks  covered  by  sickness  benefit.  This 
payment  continues  for  the  entire  duration  of  the  incapacity  and 
ceases  only  when  the  insured  reaches  seventy,  when  an  old-age  pen- 
sion of  equal  amount  is  due  him  under  the  old-age  pensions  act. 

The  maternity  benefit  of  $7.20  (exclusive  of  medical  attendance) 
provided  for  the  wife  of  each  insured  man  as  well  as  for  each  in- 
sured woman  is  one  of  the  most  popular  and  the  most  easily  admin- 
istered features.  This  payment,  made  solely  to  help  defray  the 
expenses  of  confinement  without  regard  to  incapacity  either  before 
or  after,  is  to  be  distinguished  from  sickness  benefit.  Indeed,  the 
receipt  of  a  maternity  benefit  debars  the  insured  mother  from  the 
right  to  receive  sickness  benefit  for  the  four  weeks  immediately 
following  confinement. 

The  cost  of  these  five  benefits  involving  a  large  total  annual  ex- 
penditure is  divided  among  the  worker,  the  employer,  and  the  state. 
Each  insured  man  pays  8  cents  weekly,  an  insured  woman  6  cents, 
the  employer  6  cents  weekly  for  each  employee,  man  or  woman, 
while  the  state  contributes  an  additional  4  cents.  With  the  exception 
of  the  low-paid  worker  earning  less  than  at  the  rate  of  60  cents  a 
day,  for  whom  the  employer  and  the  state  pay  a  larger  proportion  of 
the  contribution,  this  rate  is  uniform  for  all  age  or  wage  groups  and 
for  all  occupations,  regardless  of  the  sickness  hazard  of  the  industry. 

This  flat-rate  contribution,  a  distinguishing  feature  of  the  British 
system,  is  based  upon  the  cost  of  providing  a  person  of  sixteen  with 
all  the  benefits  until  seventy,  and  with  medical  and  sanatorium  bene- 
fits throughout  life.  It  allows  for  the  heavier  claims  of  later  life  by 
charging  the  person  of  sixteen  m7)re  than  his  benefits  at  that  age  ac- 
tually cost.  By  this  method  a  reserve  is  accumulated  from  which  the 
claims  of  middle  life  may  be  met.  To  estimate  this  cost  the  sick- 
ness tables  of  the  Manchester  Unity— one  of  the  old  and  well- 
managed  friendly  societies— were  used  after  they  had  been  adjusted 


' 


i 


48         TRADE  UNIONISM  AND  LABOR  PROBLEMS 
to  allow  for  a  different  distribution  of  age,  occupation,  and  civil 
status  among  the  compulsorily  insured  population.  In  this  calculation 
it  was  assumed  that  each  of  the  approved  societies  carrymg  .nsurance 
would  have  its  fair  proportion  of  the  average  distribution  of  risks, 
and  that  no  one  society  would  depart  radically  from  the  average  in 
a..e  distribution,  in  occupational  hazards  represented,  or  in  propor- 
tion of  married  and  unmarried  members.   The  actuaries,  however, 
«ere  unable  to  find  any  suitable  table  for  women,  and  accorfing  to 
their  own  admission  they  used  the  adjusted  Manchester  Unity  table 
■without  modification"  to  measure  the  probable  rates  of  sickness 
among  women.    Upon  these  assumptions  the  attempt  was  made  to 
determine  once  for  all  the  liabilities  of  this  gigantic  new  system  o 
national  insurance  and  to  fix  a  uniform  contribution  which  would 
be  sufficient  for  future  expenses  among  all  societies. 

A  uniform  contribution  for  the  various  ages  entering  insurance  at 
the  inauguration  of  the  system  was  possible  only  by  crediting  to 
tho^e  over  sixteen  the  amount  which,  had  they  been  insured  from 
Ihe'age  of  sixteen,  would  have  accumulated  to  their  credit  to  pay  for 
the  heavier  claims  of  old  age.   Accordingly  a  "reserve  value     was 
credited  to  each  person  over  sixteen  included  within  the  act,  making 
an  aggregate  total  of  8432,000,000.  This  huge  sum  at  first  appeared 
only  as  a  book  credit.   To  convert  this  into  cash,  and  at  the  same 
time  to  provide  interest  on  the  capital  sum,  nearly  one  fifth    of  each 
week-s  contribution  is  diverted  to  writing  down  the  reserves,   a 
process  which  it  was  originally  estimated  would  require  eighteen  to 
twentv  years.   ^Vhen  the  reserves  have  been  converted  into  cash, 
the  released  one  fifth  may  be  used  for  increasing  the  benefits  estab- 
lished in  the  present  act.  ,       •  .•  „ 
The  financial  side  of  the  act  centers  around  the  approved  societies 
which  are  the  real  carriers  of  insurance,  paying  cash  benefits  to  their 
members  and  reimbursing  the  insurance  committees  for  expenditures 
connected  with  medical  and  sanatorium  benefits. 

The  approved  societies,  of  which  there  are  23,500  independent 
societies,  lodges,  and  courts,  are  in  some  cases  the  old  friendly 
.The  amount  set  aside  from  each  weekly  contribution  has  been  reduced  by 
the  amending  act  of  igiS.  The  sums  thus  released  have  been  used  to  mcrease 
h  money  available  for  the  payment  of  cash  f""-  ^eneM  for  women  and 
to  create  various  special  funds  established  by  the  amending  act.  See  footnotes 
I  and  2,  p.  so. 


HEALTH  INSURANCE  IN  GREAT  BRITAIN 


49 


societies  approved  for  the  purposes  of  the  act,  some  have  been  or- 
ganized by  trade-unions,  and  still  others  are  special  societies  modeled 
after  the  friendly  societies  and  organized  to  administer  national 
health  insurance.  Following  the  prerogative  of  the  friendly  society, 
each  insured  person  is  given  an  unrestricted  right  to  select  his  society, 
and  each  society  may  reject  an  applicant  on  any  ground  save  that 
of  age.  Thus  it  may  limit  its  membership  to  those  who  are  members 
of  a  trade-union,  to  those  who  are  engaged  in  a  particular  occupation, 
or  to  total  abstainers,  etc.  The  great  discretionary  power  given  to 
the  societies  to  administer  their  own  affairs  is  a  keynote  of  the 
British  system.  In  theory  each  society  of  over  5000  members  is 
financially  independent,  its  solvency  depending  upon  its  own  suc- 
cessful administration.  If  the  expenditure  is  in  excess  of  the  actuarial 
expectancy,  a  deficiency  will  result  which  the  society  must  make 
good,  either  through  a  levy  upon  its  members  or  by  a  reduction  in 
its  benefits.  Temporary  provisions  for  persons  who  might  be  refused 
and  for  those  not  desiring  to  join  a  society  were  supplied  by  the 
"deposit  contributors'  fund,"  under  the  control  of  the  insurance 
commissioners. 

A  segregation  of  the  insured  persons  by  trade  has  in  some  cases 
resulted  from  the  freedom  of  the  insured  to  choose  his  society  and 
from  restrictions  placed  upon  membership  by  the  societies  them- 
selves. In  the  words  of  the  interim  report  of  the  departmental  com- 
mittee on  approved  society  finance  and  administration,  "Insured 
persons  were  allowed,  were,  indeed,  urged,  to  segregate  themselves 
into  societies  that  seemed  to  promise  satisfactory  results,  and  the 
prospect  was  held  out  to  them  that  they  would  derive  a  direct  benefit 
from  the  wisdom  of  the  choice  of  a  society.  In  other  words.  Parlia- 
ment contemplated  in  one  fundamental  aspect  a  departure  from  the 
fundamental  working  of  a  flat-rate  system."  This  trade  segrega- 
tion, whether  a  favorable  one,  as  in  the  case  of  bank  clerks  and 
domestic  servants,  or  an  unfavorable  one,  as  in  the  case  of  cotton- 
mill  operatives,  miners,  and  boot  and  shoe  workers,  carried  with  it 
the  isolation  of  trade  risk  far  Ijelow  or  far  above  the  average  occu- 
pational hazard  for  the  entire  insured  population  for  which  the 
flat-rate  contribution  was  calculated.  The  uniform  contribution  cal- 
culated for  the  average  is  frequently  insufficient  for  the  worse  risks, 
and  a  society  may  therefore  be  threatened  with  a  deficiency,  since 


r:| 


i 


I  I 


50        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

each  is  financially  independent  and  is  unable  to  benefit  from  the 
uiu  of  another  having  a  more  favorable  selection  of  membe  s 
ThTdeficiency  from  this  cause  actually  threatenmg  some  soc.etie. 
has  proved  a  serious  matter  to  two  departmental  committees  The 
'e'ommendatfens  of  both  were  the  same;  namely  that  a  portion  o^ 
•he  reserve  fund  be  set  aside  to  form  a  "  special-nsks  fund  from 
which  sodeties  having  an  unfavorable  selection  of  lives  m.ght  recoup 
^emsdves.  This  assistance  to  individual  societies  '---^j;- 
though  the  sickness  benefits  for  men,  taken  as  a  whole,  are  withm 
the  actuarial  expectation/ 

Moreover,  a  'variation  from  the  normal  distribut.on  of  woma, 
has  presented  grave  financial  questions  to  other  sooet.es.   The  sick- 
ness rates  for  women,  it  has  been  pointed  out,  were  assumed   m  the 
absence  of  other  evidence,  to  be  the  same  as  those  '"■•men^  Ex- 
perience has  shown  that  sickness  among  smgle  women  is  m  excess 
of  the  expected  rate,  while  that  of  married  women  is  even  more  ex- 
cessive   This  means  that  the  women  are  now  receivmg  more  than 
their  contributions  entitle  them  to.   To  remedy  the  s.tuat.on  con- 
tributions should  be  increased  or  the  benefits  reduced.    This  funda- 
mental remedy  has  been  shunned  by  two  departmental  committees 
in  succession,  and  the  same  solution  has  been  proposed  by  both,- 
that  of  diverting  part  of  the  reserve  funds  to  supply  the  immediate 
needs    To  meet  the  more  numerous  daims  of  married  women,  due 
in  Dart  to  the  demands  for  sickness  benefit  during  pregnancy,  un- 
foreseen by  the  actuaries,  still  a  third  invasion  upon  the  reserve 
funds,  coupled  with  a  parliamentary  grant,  is  contemplated  by  both 

committees  .- 

iThe  amending  act  of  1Q18  has  met  the  problem  of  unequal-sickness  ex- 

o^r  rend^LT^^^^^^^^  which  are  cau^d^^  f ^^^^^^^ 

ing  from  occupational  hazard  or  by  other  causes  over  which  the  society  has 

"^'Thelmending  act  of   1918  has  provided  for  the  excess  sickness  among 
-  The  amenmng  acL  o       y  available  for  paymg  benetits 

"m  n  XTu^    s  ;btined  by  subtracting  this  V.d.  from  the  amounts 
originaTly  seraside  for  writing  down  the   re.rves.   The  amendmg  act  also 


HEALTH  INSURANCE  IN  GREAT  BRITAIN  51 

In  contrast  to  this  segregation,  a  widely  scattered  membership 
without  geographical  or  trade  grouping  may  result  from  the  same 
freedom  in  selecting  a  society.  This  situation,  though  unaccompanied 
by  the  same  financial  dangers,  has  its  grave  disadvantages.  For 
example,  because  the  members  of  a  community  or  industry  are  in- 
sured in  hundreds  or  even  thousands  of  societies  with  other  persons, 
it  is  difficult  to  discover  an  excessive  amount  of  sickness  for  that 
group.  Without  this  knowledge  it  is  of  course  more  difficult  to  take 
preventive  steps.  Moreover,  a  membership  distributed  throughout 
the  entire  kingdom  has  materially  hindered  the  development  of  any- 
thing like  an  effective  system  of  sick  visiting ;  it  is  even  a  question 
with  one  society  actually  insuring  millions  of  workers  whether  a 
complete  system,  reaching  out  to  the  tiny  isolated  villages,  will  pay 
for  itself.  Without  such  a  system  the  ratio  of  unnecessary  claims 
will  be  somewhat  higher  than  when  they  are  closely  watched,  as  they 
can  be  with  a  concentrated  membership. 

The  conclusion  to  be  drawn  from  this  British  experience  with  a 
flat-rate  contribution  and  with  free  choice  of  carriers  is  twofold.  First 
the  two  when  dependent  on  each  other  are  undesirable.  A  flat-rate 
contribution  is  clearly  impossible  when  there  is  unrestricted  freedom 
in  the  selection  of  the  society,  because  of  the  segregation  of  special 
risks  which  may  and  does  result.  Secondly,  even  if  the  flat  rate  is  not 
combined  with  choice  of  approved  society  and  if  all  possibility  of 
segregation  of  risks  is  eliminated  by  prescribing  the  carrier,  a  flat 
rate  is  still  undesirable.  iMrst,  it  is  impossible  to  foretell  accurately 
the  liabilities  even  upon  the  most  accurately  prepared  sickness  data. 
The  error  in  the  sickness  rates  of  women  made  by  the  British  ac- 
tuaries is  an  example.  Secondly,  the  contribution  is  regarded  as 
permanent  by  the  contributors,  and  any  attempt  to  change  it  is 
resisted.  Hence,  as  in  Great  Britain,  initial  mistakes  in  the  financial 
estimates  must  be  rectified  from  some  other  source.  The  same  op- 
position to  any  increase  i^  the  contributions  has  been  manifested 
when  the  purpose  has  been  to  increase  the  facilities  of  the  insurance 
system.   As  a  result,  such  additional  expenditures  have  been  met 

provides  for  the  higher  sickness  rate  among  married  women  by  establishing  the 
women's  equalization  fund  derived  from  parliamentary  grants.  This  fund 
IS  to  be  apportioned  among  the  approved  societies  with  reference  to  the  number 
of  married  women  members. 


■I  If  J 
'Iff  I 


I 


'I 

I 


52         TR.\DE  UNIONISM  AND  LABOR  PROBLEMS 

bv  Darliamentary  grants  when  as  a  matter  of  justice  the  increased 

£orn    sl'ud  h^v;  been  derived  from  the  insurance  payments^  The 

system  of  free  choice  of  carrier,  even  if  unaccompanied  by  a  flat^rate 

ontrLtion,  is  in  itself  undesirable.   The  --  segre^^^^^^^^^^^       me- 

te  dlerence  in  the  weekly  contribution,  assummg  .t  made  a  d.f- 

E?of^-m-nc:^^^^^^^^^^       -f = 

-i;:  rn^af  ^rf^uTt^::^^^^^^^^^^^^       system,  it  is  importan. 

tolear  in  mind,  are  due  to  the  attempt  to  forecast  once  for  aU  t  me 

he  CO  t  of  the  nsurance,  in  which  the  government  actuaries  faded, 

!■  nHlvto  the  ironclad  nature  of  the  contributions  and  bene- 

and,  secondly  to  the   roncla  ^^^.^.^^^^  .^^^^^  ^^^^ 

htt:t  "tel  a  e'd^f-ts  which  the  flexible  average  premium 
ystem  adopted  by  the  German  act  and  in  successful  operation  now 
rmore  thL  a  .uarter  ^;^J^^:i^Z:^^  which 
^'^T'"l;1ir;rt    r,hl^  committees  and  the 

c^af  i  sTar  oiToters.  The  administration  of  medical  and 
sanator  um  benehts,  although  duties  naturally  falling  upon  the  ap- 
nroved  sodeties  have  been  farmed  out  to  the  insurance  committees 
Tcaut  oh  greater  ease  in  administration  when  the  membersh^ 
?s  localized  The  insurance  committees -which  require  dupli  ate 
ecord'  Tncrease  the  staff  of  workers,  and  thus  add  to  the  cost  of 
!,  :L  rXn-are  a  cumbersome  effort  to  provide  for  local  ad- 
SS: L  p::ndple  of  which  has  been  violated  by  the  present 

"'?rcrraratilCit:;Ssted  to  four  commissions,  one 


HEALTH  INSURANCE  IN  GREAT  BRITAIN  53 

for  each  of  the  four  countries  England,  Ireland,  Scotland,  and  Wales, 
and  a  joint  committee  which  coordinates  their  activities.'  It  is  these 
five  bodies,  jointly  referred  to  as  the  commission,  which  make  the 
extensive  regulations  for  the  administration  of  the  act,  and  which 
supervise  the  approved  societies  and  insurance  committees,  endeavor- 
ing as  far  as  possible  to  make  the  practices  uniform  throughout  the 
kingdom.  Here  too  there  is  unnecessary  duplication  in  administra- 
tive force,  necessitated  by  the  strong  feeling  for  "home  rule,"  which 
is  not  fonfined  to  Ireland  alone. 

Notwithstanding,  however,  the  unfortunate  systems  of  finance  and 
of  administration  which  have  been  adopted,  the  beneficial  effects  of 
the  act  are  quite  evident.    During  the  first  year  of  benefits  (January, 
1913-January,  19 14)  3,600,000  persons  are  calculated  to  have  had 
sick  benefit,  or  about  25  per  cent  of  those  insured,  an  experience 
which  roughly  corresponds  with  the  financial  estimates.    This  has 
involved  an  expenditure  of  $30,000,000  for  the  entire  kingdom.    The 
disablement  benefit,  which  really  covers  permanent  invalidity,  was 
expected  to  involve  an  expenditure  of  $9,700,000  in  1915,  thus  in- 
creasing by  one  third  the  amount  spent  in  sickness  benefit.    Its  fi- 
nancial success,  for  which  there  were  many  fears  before  it  came  into 
operation  in  July  of  1914,  is  revealed  in  the  recent  interim  report 
of  the  departmental  committee  on  approved  society  finance  and 
administration.    The  committee  states  that  during  the  first  eighteen 
months  the  expenditure  was  within  the  actuarial  expectation  for  that 
period,  but  that  in  the  future  it  is  possible  that  the  disablement 
benefit  for  women,  and  especially  for  married  women,  may  involve  a 
heavier  charge  than  originally   anticipated.    The   combined   effect 
of  the  medical  care  and  the  provision  of  cash  benefit  is  that  many 
who  previously  had  dragged  along  without  medical  advice,  forcing 
themselves  day  by  day  to  work  in  spite  of  illness,  have  now  for  the 
first  time  had  proper  attention.    Physicians  have  said,  "  I  thought 
I   knew   how   much   illness   there   was   in   my   neighborhood,    but 
I  had  no  conception  of  the  amount  that  existed  until  I  was  brought 
in  contact  with  it  through  the  act.  ...   I  had  no  idea  that  it  existed 

1  The  Ministry  of  Health  Bill  provides  that  the  .work  conducted  by  the 
insurance  commissions  shall  be  under  this  new  department,  which  will  also 
direct  the  health  activities  previously  conducted  by  other  government  bodies, 
such  as  the  local  government  board. 


i 


54        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

and  was  going  unrelieved,  and   that  people  were  d-gg'^g  ^^^"/^ 

tlluch  mness."   An  official  festigating  comm^^^^^^^^ 

"already  there  are  indications  that  -^  ^"^^  ."J ;,'^4^^^^^^^^  been 
under  the  act  a  better  comhtion  of  health  has  in  certa 

•     J  ♦i^or,  v.r.c  Vippn  exoerienced  for  many  years. 

atta.ned  than  .'''^^^''^"/^P"™.  .^^j^jed  went  each  week  of  the  first 

The  maternity  benefit,  it  is  calcuiatea,  wcui  received 

vear  to  .7,000  mothers,  and  throughout  that  yea    fV.ooo  recel^ed 

maunitv  benefit,  involving  a  total  expenditure  of  $7,o°o,oo°    The 

at^rinew  problem,  .hich  can  be  solved  only  by  providing  the 
materniU-  bene' t  in  much  the  same  way  as  medical  assistance  is 
now  provided  for  insured  persons. 

nool  dock  laborers  it  is  estimated  that  m  half  the  cases  wtiicn  re 
Lted  s  c^^^^^^^     the  home  would  have  been  broken  up  and  relief 

ught  in  the  workhouse  had  it  not  been  for  the  ^^f^^ij^^  ; 
.nr^nce  act  Charity  workers  too  have  found  that  the  calls  tor 
financTal  r^^^^^^^^^^^^  both  in  number  and  in  the  amount 

of  assis  ance  required.    On  the  other  hand,  some  of  the  local  poor- 

w  oS^^^^^  the  enlarged  use  of  doctors  brought  about  by 

Z  insurance  act,  which  is  revealing  a  larger  number  -edrng  hospUal 
care  mav  increase  the  inmates  of  the  poor-law  mfirmar  es.  This, 
o  cou^sl  is  signiftcant  of  the  higher  standard  of  medical  c^^^^^^^^^^^ 
the  workingman  resulting  from  the  insurance  provisions.    Sanatorium 


HEALTH  INSURANCE  IN  GREAT  BRITAIN 


55 


benefit,  notwithstanding  petty  jealousies  between  rival  local  boards, 
fostered  by  the  administrative  system  and  the  inadequate  funds  at  the 
disposal  of  the  insurance  committees  for  their  share  of  the  work, 
was  received  by  no  fewer  than  44,000  insured  workers  in  the  first 
eighteen  months'  operation  of  the  act.  Of  this  number  more  than 
half  were  placed  in  sanatoria,  others  were  treated  in  dispensaries,  and 
still  others  were  cared  for  in  their  homes  by  the  panel  doctor,  under 
the  guidance  of  the  tuberculosis  officer.  To  assist  in  home  treatment 
1200  shelters  for  out-of-door  sleeping  were  available,  and  in  other 
cases  milk  and  eggs  were  supplied  to  patients  in  their  homes. 

Moreover,  the  whole  antituberculosis  movement  has  been  strength- 
ened. To  provide  the  additional  sanatoria  necessary  for  the  treat- 
ment of  the  insured  and  their  dependents  provided  for  in  the  act, 
Parliament  in  191 1  made  a  grant  of  $7,200,000  to  defray  part  of  the 
expense  of  sanatoria,  whether  erected  for  insured  or  noninsured. 
Under  this  generous  provision  plans  for  3000  new  beds  had  been 
made  within  the  first  twenty  months  and  grants  to  the  extent  of 
$1,287,000  had  been  either  made  or  promised.  Following  the  rec- 
ommendations of  the  famous  Waldorf  Astor  committee,  that  sana- 
torium benefit  should  be  available  not  only  to  dependents  of  the 
insured  but  to  the  whole  population,  the  government  announced  in 
July  of  1912  that  it  was  willing  to  bear  one  half  of  the  expense 
incurred  by  the  local  authorities  in  treating  noninsured  persons  as 
well  as  the  dependents  of  insured  workers.  For  this  purpose  Parlia- 
ment granted  $1,464,000  and  $2,300,000  for  the  budget  years  of 
19 14  and  191 5  respectively.  The  provisions  which  have  thus  far 
been  made  are  but  the  beginning  of  an  effective  crusade  against  tuber- 
culosis, instigated  by  the  insurance  act  and  originally  restricted  to 
the  insured  and  their  families  but  later  extended  to  the  entire  popula- 
tion. 

If  even  a  cumbersomely  conceived  plan  of  health  insurance  can 
improve  health,  decrease  pauperism,  and  forge  an  effective  weapon 
against  tuberculosis,  are  not  we  Americans  challenged  to  devise  a 
system  which  will  function  more  perfectly  in  our  war  against  poverty 
and  disease  ?  ^        j 


Olga  S.  Halsey 


American  Association  for  Labor  Legislation 


1 


BRITISH   UNEMPLOYMENT  INSURANCE 


57 


IV 

THE  BRITISH  NATIONAL  SYSTEM  OF  UNEM- 
PLOYMENT INSURANCE— ITS  OPERATION  AND 

EFFECTS' 

COMPULSORY  national  unemployment  insurance,  the  second 
Rreat  effort  of  Great  Britain  to  treat  unemployment  as  an  mdus- 
trial  problem,  followed  closely  upon  the  inauguration  of  the  labor  ex- 
changes Although  this  provision  was  planned  to  accompany  he 
measure  for  labo^  exchanges,  the  project  was  withheld  untd  the  plan 
might  be  perfected  and  until  the  exchanges  might  become  an  efficient 

adfunct.  When  a  bill  was  tonally  -^^^1"-^"'°/"  "Th I  cal 
neared  as  Part  II  of  the  National  Insurance  Act  of  .911.  This  came 
Lo  operation  in  July,  rpi^,  as  far  as  contributions  were  concerned 
but  it  was  not  until  six  months  later,  in  January,  .<)n,i^^^  benefits 
were  payable.  Amendments  affecting  details,  traceable  in  part  to  the 
war,  were  passed  in  1914,  1915- and  1916.  -.^j  „„„ 

The  act  aims  to  cover  involuntary  unemployment  m  a  limited  num- 
ber of  occupations  through  compulsory  insurance,  to  which  employ- 
ers the  workers,  and  the  state  contribute.   The  compulsory  basis  was 
adapted  as  an  essential  condition  for  the  elimination  of  unfavorab  e 
selection  of  risks  against  the  fund  and  to  secure  the  msurance  of  those 
who  could  not  be  reached  through  voluntary  provision.   The  com- 
Dulsory  feature  embraces  workmen  of  sixteen  and  over,  employed  at 
manual  labor  under  a  contract  of  service  in  the  following  trade^: 
building,  construction  work  (such  as  railroads,  docks,  harbors,  em- 
bankm;nts,  etc.),  shipbuilding,  mechanical  engineering   (mcluding 
the  manufacture  of  ordnance  and  firearms),  iron  founding,  construc- 
tion of  vehicles,  and  sawmilling  when  carried  on  in  connection  wi  h 
an  insured  trade  or  of  a  kind  usually  carried  on  in  connection  with 
an  insured  trade. 

iFrom   Proceedings   of    the    Conference    on    Social    Insurance,    1916.    U.S. 
Bureau  of  Labor  Statistics,  Bulletin  No.  212,  pp.  874-886. 

56 


The  workmen  thus  insured  numbered  2,282,324  in  January,  1914, 
when  the  act  had  been  in  operation  one  and  a  half  years.  The  distri- 
bution of  these  workmen  among  the  various  trades  is  shown  in  the 
accompanying  table. 

Distribution  of  Workmen  among  the  Insured  Trades,  as  shown  by 
THE   Number  of  Unemployment   Books  issued  to  Workers,  July, 

1912,  to  July,  1914 


Insured  Trade 


Building ' 

Construction  of  docks,  railroads,  canals,  etc 

Shipbuilding 

Mechanical  engineering 

Construction  of  vehicles 

Sawmilling  (of  a  kind  commonly  carried  on  in  an  in- 
sured trade) 

Other  industries  (insured  trades  which  occur  in  con- 
nection with  other  industries,  and  where  the  non- 
insured  industry  is  main  business  of  the  employer) 
Total 


Number  of 

Unemployment 

Books  issued 

TO  Workers, 

July,  1912,  to 

January,  1914 


775755 
161,168 

260,820 

804,527 

204,672 

11,819 


63^563 


Per  Cent 

OF  TOTAI- 

Insured 


340 

7.0 

II.4 

35-3 

9.0 

•5 


2.8 


2,282,324 


1 00.0 


An  analysis  of  the  insured  workers  indicates  that  64  per  cent  were 
skilled,  36  per  cent  unskilled,  and  approximately  25  per  cent  union 
men.  The  insured  include  about  10,000  women  and  110,000  minors 
between  sixteen  and  eighteen  years  of  age. 

Exemptions  within  this  group  may  be  made  by  the  Board  of  Trade 
on  the  ground  that  the  occupations  usually  are  carried  on  inde- 
pendently of  an  insured  trade  or  that  ihey  are  common  to  both  in- 
sured and  uninsured  trades.  During  the  first  year  three  such  orders 
were  issued.  Those  in  the  permanent  service  of  the  Crown  are  also 
excluded. 

Determinations  as  to  whether  men  are  engaged  in  an  insured  trade 
are  made  by  the  umpire  appointed  by  the  Crown.  All  decisions  rest 
upon  the  provision  of  the  act  that  the  determining  factor  shall  be 
the  nature  of  the  work  and  not  the  business  of  the  employer.   On 


I 


ll 


58         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

this  basis  flagmen  and  lookout  men  employed  by  a  railway  in  con- 
nection with  construction  are  not  considered  as  engaged  nr  an  .nsured 
o«upation.   The  demarcation  of  insured  trades  on  this  prmc.ple  has 
proved  a  technical  problem  requiring  during  the  first  year  1268  pub- 
lished decisions  and   10,000  others  given  in  correspondence    Not- 
withstanding, the  Board  of  Trade  considers  demarcation  practicable 
The  application  of  insurance  to  specified  occupations  only  was  due 
to  the  dictates  of  prudence  that  the  new  experiment  be  confined  to 
those  trades  for  which  there  was  the  greatest  amount  of  data  re- 
garding unemployment.    By  a  happy  coincidence  these  trades  are 
"those  in  which  the  fluctuations  of  unemployment  are  most  severe  and 
where,  therefore,  there  is  the  greatest  need  of  protection 

From  the  outset  it  was  realized  that  it  might  prove  desirable  to 
extend  the  provisions  to  other  trades,  and  accordingly  power  was 
given  the  Board  of  Trade  to  include  other  occupations,  provided 
that  it  would  not  increase  the  parliamentary  contribution  by  inore 
than  £1,000,000   ($4,866,500)   annually  during  each  of   the  three 
years  foUowing.    Resolutions  in  favor  of  the  universal  application 
of  the  act  were  passed  by  the  Labor  Party  at  its  conference  in  Feb- 
ruary  1914,  while  the  pressure  of  the  demand  from  all  sides  during 
the  spring  of  19 >4,  was  felt  by  the  president  of  the  Board  of  Trade. 
Preparation  for  extension  by  a  special  order  was  made  m  regulations 
issued  in  May,  1914.    Further  progress,  however,  was  prevented  by 
the  war  until  the  exceptional  development  of  war  industries  forcibly 
called  attention  to  the  necessity  of  provision  for  those  whom  peace 
and  the  attending  dislocation  of  trade  would  throw  out  of  work. 

The  cost  of  insurance  is  divided  equally  between  the  employer  and 
the  worker,  each  contributing  at  the  uniform  weekly  rate  of  2/2  d. 
(  =  08  cents),  while  the  state  contributes  one  third  of  this  total,  or 
i%d    (3.38  cents)  per  week.   In  the  case  of  boys  under  eighteen 
the  combined  contribution  of  employer  and  worker  is  but  2d.  (4.06 
cents)  weekly.    Men  employed  for  less  than  one  week  pay  a  reduced 
contribution  of  id.  (2.03  cents)  for  employment  of  one  day,  2d. 
(4  06  cents)  for  two  days,  and  the  usual  2/.  d.  (5.08  cents)  for  more 
than  two  days'  engagement.  On  this  basis  contributions  for  six  days  of 
casual  employment  cost  employer  and  workman  6d.  (12.17  cents) 
each   as  against  the  normal  weekly  rate  of  2/2 d.  (5-o8  cents).  The 
greater  expenses   for  casual   labor  may   be   avoided  by   engaging 


1! 


BRITISH   UNEMPLOYMENT   INSURANCE  59 

laborers  through  the  exchange  and  by  making  arrangements  whereby 
the  exchange  pays  the  contribution.  Under  these  conditions  six  days' 
work  of  six  different  men  are  reckoned  as  one  week's  job  for  one 
man,  and  the  six-penny  contribution  is  reduced  to  21^^.  (5.08  cents). 
Advantage  of  this  section  was  taken  by  the  employers  of  95,000 
casual  laborers  during  the  first  year  of  operation.  The  combined 
contributions  of  workers  and  employers  accumulated  a  fund  of 
£1,622,000  ($7,893,463)  during  the  first  year,  which  was  increased 
by  the  parliamentary  contribution  of  £378,000  ($1,839,537).  The 
income  of  the  second  year  was  £1,802,000  ($8,769,433)  from  em- 
ployers and  workers  and  £602,000  ($2,929,633)  from  Parliament. 
From  this  fund,  controlled  by  the  Board  of  Trade,  the  benefits  are 
paid  and  sums  laid  away  for  reserve  with  which  to  meet  the  demands 
of  years  of  exceptional  unemployment. 

The  contributory  basis  was  considered  essential  in  order  to  secure 
the  interest  of  employers  and  workmen  in  its  financial  security.  Un- 
derlying this  practical  reason  is  the  assumption  that  if  industry  de- 
mands a  reserve  of  labor  it  should  help  support  it  through  the  lean 
years.  The  contribution  of  the  workman  would  seem  justified  be- 
cause it  is  he  who  benefits.  The  uniform  contribution  was  necessarily 
adopted  because  of  the  lack  of  actual  data  upon  which  to  grade  pay- 
ments in  proportion  to  the  hazard  of  each  industry,  the  age,  or  the 
wage  of  each  employee.  Statistics  indicated,  however,  that  there 
was  a  variation  in  the  incidence  and  the  duration  of  unemployment 
between  different  branches  of  the  insured  trades,  a  variation  which 
it  was  planned  to  meet  by  granting  a  weekly  benefit  of  75.  ($1.70) 
in  the  engineering  trade  and  of  6  s.  ($1.46)  in  the  building  group. 
This  plan  did  not  meet  approval,  and  instead  a  uniform  benefit  of 
7  ^.  ($1.70)  a  week  for  all  trades  was  adopted. 

A  modification  of  the  flat  rate  was  provided  for  the  employer  of 
regular  workmen,  for  whom  a  refund  of  one  third  of  the  contribu- 
tions was  made  for  each,  man  employed  continuously  for  one  year  and 
for  whom  at  least  45  contributions  had  been  paid.  Under  this  ar- 
rangement, up  to  March,  1914,  an  average  refund  of  3  .^.  6  d.  (85.17 
cents)  had  been  made  for  each  of  574,000  workers,  or  one  fourth  of 
the  insured.  Simplifications  were  introduced  by  the  amending  act  of 
1914,  which  stipulated  that  payment  of  45  contributions  was  sufficient 
to  entitle  the  employer  to  a  refund  of  3  ^.  ( 73  cents)  for  each  workman 


J: 


iM 


II 


6o         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

^0  employed.  A  similar  refund  is  made  to  the  employee  when  he  has 
reached  sixty,  if  he  has  made  500  contributions  to  the  fund.  He  then 
receives  the  difference  between  the  amount  he  has  contributed  and 
that  received  in  benefits,  together  with  compound  interest  at  the  rate 
of  23^  per  cent  a  year.  This  arrangement,  which  turns  insurance  into 
a  savings  fund  for  the  old  age  of  those  seldom  out  of  a  job,  has  been 
an  important  factor  in  decreasing  the  hostility  of  the  better  workmen, 
who  otherwise  might  feel  that  the  act  held  nothing  for  them. 

The  possibility  that  contributions  would  not  be  sufficient  to  meet 
the  liabilities  imposed  by  the  act  was  faced  from  the  outset.  Pro- 
vision for  temporarv  advances,  not  exceeding  a  total  of  £3,000,000 
($14  599,500),  from  the  treasury  was  made  in  the  original  act,  with 
the  proviso  that  if  it  should  appear  that  the  fund  was  insolvent  the 
treasury  might  direct  the  Board  of  Trade  to  alter  the  rates  of  con- 
tributions or  the  scale  of  benefits.  After  the  act  has  been  in  operation 
seven  years  the  Board  of  Trade  may  revise  the  rates,  adjusting  them 
according  to  the  amount  of  unemployment  in  each  trade,  provided, 
however  that  the  contributions  of  employer  and  worker  shall  not  be 
increased  by  more  than  id.  (2.03  cents)  each  and  that  the  shares  of 
employer  and  employee  remain  equal. 

The  enforcement  of  the  contributions  is  undertaken  by  inspectors 
of  the  Board  of  Trade,  who  see  that  the  employers  duly  pay  their  own 
and  employees'  contributions  by  means  of  stamps,  representing  the 
combined  contributions,  placed  in  the  workers'  unemployment  books. 
These  books  are  obtained  from  the  labor  exchanges,  are  left  with  the 
employers   for   stamping   during   periods   of   employment,    are   re- 
turned to  the  workers  on  leaving  positions,  and  are  then  deposited  by 
them  at  the  exchanges  when  they  claim  benefits.  It  is  the  employer 
who  is  liable  for  contributions,  but  the  workman  becomes  liable  if  he 
knowingly  allows  his  employer  to  avoid  payment.    Prosecutions  of 
employers  numbered  twenty-four  during  the  first  year,  ending  July, 
1013   and  convictions  were  secured  in  all  but  one  case.    Twenty-two 
cases' dealt  with  the  employer's  failure  to  pay  the  necessary  contribu- 
tion and  one  with  an  attempt  to  deduct  the  contribution  from  the 
employee's  wage.    One  workman  was  fined  for  refusing  to  apply  for 

an  unemployment  book. 

The  payment  of  the  weekly  cash  benefit  of  7  s.  (S1.70)  to  adult  un- 
employed workmen  began  in  January,  1913,  after  contributions  had 


BRITISH  UNEMPLOYMENT  INSURANCE  6i 

been  payable  for  six  months.  Benefit  is  not  paid  during  the  first 
week  of  unemployment,  is  limited  to  fifteen  weeks  during  the  in- 
surance year,  and  is  paid  only  in  the  proportion  of  one  week's  benefit 
for  every  five  weeks'  contributions.  In  the  case  of  minors,  those 
under  seventeen  receive  no  benefits  and  those  between  seventeen  and 
eighteen  receive  half  the  benefits  of  an  adult. 

All  claims  for  benefit  must  be  lodged  at  the  local  labor  exchange, 
where  the  worker  deposits  his  unemployment  book  and  where  he  is 
placed  automatically  upon  the  list  of  those  looking  for  work.  The 
claimant  must  then  prove  his  unemployment  by  signing  a  register 
at  the  exchange  each  day  within  working  hours,  or,  if  he  is  a  union 
man,  he  may  sign  the  union  "vacant"  book  kept  at  the  union  offices 
or  at  the  exchange.  As  an  alternative  he  may  be  given  a  card  which 
he  carries  with  him  and  which  he  may  have  stamped  by  any  ex- 
change in  the  city  as  he  searches  for  work.  The  labor-exchange 
officials  prefer  daily  signing  at  the  exchange,  because  they  are  able 
to  place  more  easily  those  with  whom  they  have  frequent  contact. 

During  the  first  twelve  months  of  benefit  (January,  1913,  to  Janu- 
ary, 1914)  a  total  of  1,144,213  claims  to  benefit,  or  a  weekly  average 
of  22,000,  were  made.  In  the  early  days  of  the  war  the  weekly 
average  increased  to  45,000  for  August  and  33,000  for  September, 
1 9 14.  Since  the  first  dislocation  of  industry  the  weekly  quota  has 
steadily  declined,  so  that  for  March,  1915,  the  weekly  average  was 
8229;  for  March,  1916,  3535;  and  for  August,  1916,  1920.  This 
decline  is  reflected  in  the  total  number  of  claims  shown  in  the  fol- 
lowing table  for  1913,  1914^  1915^   1916: 


fl 


f;. 


Numbers  of  Claims  for  Unemployment  Benefit 

'9^3     ■     ■    f 1,144,213 

^9M 1,220,359 

1915 380,710 

1916(10  months) 122,902 

These  claims  involved  an  expenditure  of  £497,725  ($2,422,178.71) 
^of  1913,^542,499  (82,640,071.38)  for  I9i4,;£i32,349  ($644,076.41) 
for  1915,  and  £39,483  ($192,144.02)  for  the  first  ten  months  of  1916. 
Here,  too,  the  effect  of  the  diminished  unemployment  has  made  itself 
distinctly  felt. 


i.V 


il 


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illl 


iu 


62         TRADE  UNIONIS^NI  AND  LABOR  PROBLEMS 

Payment  is  made  only  after  it  has  been  ascertained  that  the  statu- 
tory qualifications  for  benefits  have  been  fulfilled.  During  the  first 
benefit  year  qualifying  conditions  threw  out  102,000  claims,  or  9  per 
cent  of  the  total. 

The  first  qualification  for  benefit  under  the  act  of  191 1  was  em- 
ployment in  an  insured  trade  for  twenty-six  weeks  during  the  past 
five  years.  Proof  of  this  was  especially  difficult  for  nonunion  men, 
and  although  rigid  proof  was  not  demanded,  the  lack  of  accept- 
able evidence  caused  36  per  cent  of  the  disallowances  during  the 
first  benefit  year.  The  amending  act  of  19 14  remedied  this  difficulty, 
of  which  unionists  complained,  by  reducing  the  requirement  to  the 
payment  of  ten  contributions.  The  second  qualification  is  the  in- 
ability of  those  capable  of  work  to  obtain  suitable  employment. 
The  determination  of  what  is  suitable  work  is  one  of  the  nice  ques- 
tions which  demand  a  knowledge  and  a  full  understanding  of  the 
conditions  of  work  which  a  man  is  justified  in  refusing.  The  funda- 
mentals of  the  decision  are  laid  down  in  the  act ;  namely,  that  a 
man  shall  not  be  considered  to  have  refused  suitable  work  if  he  has 
refused  a  job  vacant  because  of  a  strike,  or,  secondly,  if  in  his  own 
neighborhood  the  wages  and  the  conditions  of  work  are  less  favor- 
able than  those  which  he  has  habitually  obtained,  or,  thirdly,  if  the 
wages  and  working  conditions  offered  him  in  another  district  are 
not  those  generally  observed  in  that  area.  This  provision,  which 
depends  wholly  upon  its  interpretation,  is,  on  the  whole,  being  carried 
through  in  the  spirit  of  the  law,  according  to  trade-union  critics. 
The  accepted  standard  of  wages  in  districts  which  are  well  organized 
is  the  union  rate,  while  in  others  wages  paid  by  the  better  firms  have 
become  the  criterion. 

Men  who  have  fulfilled  these  conditions  must  be  without  work  for 
a  week,  for  which  no  benefit  is  paid,  before  they  are  entitled  to  bene- 
fit. This  so-called  waiting  week  covered  29  per  cent  of  the  unem- 
ployment recorded  within  the  first  six  months  of  benefits,  even 
though  this  week  for  which  no  benefit  is  paid  is  credited  as  the 
waiting  period  for  subsequent  unemployment  occurring  within  six 
weeks. 

Since  the  act  aims  to  cover  only  involuntary  unemployment,  it 
disqualifies  from  benefit  men  who  are  out  of  work  because  of  a  trade 
dispute  at  the  factory  at  which  they  are  employed,  those  who  have 


BRITISH  UNEMPLOYMENT  INSURANCE 


63 


been  discharged  for  misconduct,  and  finally  those  who  voluntarily 
leave  a  position  without  just  cause.  In  this  instance  disqualifica- 
tion is  limited  to  a  six  weeks'  period  after  leaving  employment.  To 
ascertain  these  facts  a  form  is  sent  to  the  last  employer,  who  is  asked 
if  the  applicant  lost  his  job  through  any  circumstances  which  should 
disqualify.  If  no  reply  is  received  the  local  officer  is  compelled  to 
assume  that  the  claim  is  valid,  unless  suspicious  circumstances  sug- 
gest themselves.  It  is  probable  that  from  10  to  15  per  cent  of  the 
claims  are  questioned  because  of  the  nature  of  the  reply  of  the 
employer.  In  the  absence  of  penalty  for  misstatement  from  the  em- 
ployer the  unionists  feel  that  a  statement  from  a  prejudicial  fore- 
man may  deprive  a  man  of  benefit  unjustly. 

An  analysis  of  disallowed  claims  showed  that  disqualifications 
because  of  a  trade  dispute  accounted  for  just  over  17  per  cent  of  the 
refusals  of  benefit  during  the  year  January,  19 13,  to  January,  19 14. 
The  administration  of  this  clause  is  unsatisfactory  .to  the  unions, 
because  they  have  been  unable  to  get  a  general  ruling  from  the 
umpire  as  to  what  constitutes  a  trade  dispute  and  because  in  specific 
instances  they  have  not  agreed  as  to  what  constituted  a  strike  or 
lockout.  Equally  unpopular  is  the  interpretation  placed  upon  the 
act  which  debars  a  man  from  benefit  when  thrown  out  of  work  by  a 
strike  at  his  works,  even  though  his  department  is  unemployed  only 
because  of  the  absence  of  the  other  men.  The  two  remaining  dis- 
qualifications—  misconduct  and  voluntary  leaving  without  just 
cause — accounted  for  38  per  cent  of  the  claims  disallowed  during  the 
same  period.  In  deciding  whether  a  man  has  just  cause  for  throw- 
ing up  a  job  considerations  enter  which  affect  the  minimum  stand- 
ard of  employment — whether  a  man  is  justified  in  refusing  to  submit 
to  working  conditions  to  which  he  has  grown  accustomed  during  the 
last  few  years  or  whether  he  is  justified  in  leaving  for  a  higher  wage. 

Provision  is  m^de  in  the  act  for  difference  of  opinion  on  such 
questions.  The  insurance  officer  attached  to  each  of  the  eight  divi- 
sional offices  passes  upon  the  claim.  If  payment  is  authorized,  he 
notifies  the  local  exchange  where  the  claim  originated.  If  the  officer 
decides  against  the  workman,  the  latter  may  appeal  to  a  court  of 
referees.  These  bodies  consist  of  an  impartial  and  salaried  chair- 
man designated  by  the  Board  of  Trade,  and  a  representative  of  the 
workers  and  of  the  employers  drawn  from  a  panel  to  which  the 


:i 


^  t 


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I' 


64         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

workers'  representatives  have  been  elected  and  to  which  the  em- 
ployers' have  been  appointed  by  the  Board  of  Trade.  During  the 
first  six  months  of  benefit  about  one  out  of  each  twelve  disallowed 
claims  was  appealed  to  a  court  of  referees.  If  this  court  confirms  the 
decision  of  the  insurance  officer  against  the  workman,  this  closes  the 
case;  but  if  it  disagrees,  appeal  may  be  carried  by  the  officer  to 
the  umpire,  whose  decision  is  final.  His  judgment  as  to  whether  a 
man  has  just  cause  for  leaving  or  whether  he  has  refused  suitable 
employment  affects  the  mobility  of  labor  by  standardizing  the  con- 
ditions upon  which  workers  may  quit  work  and  still  draw  benefit. 
These  decisions,  in  the  words  of  the  New  Statesman, 

have  clearly,  on  the  whole,  been  marked  by  a  conception  of  the  duty 
of  the  workman  to  uphold  his  standard  of  working  conditions  which 
is  sufticientlv  broad-minded  and  generous  to  go  far  toward  securing 
the  smooth  and  satisfactory  working  of  the  unemployment  insurance 
scheme.  .  .  .  The  system  of  unemployment  insurance  is  clearly 
capable  of  being  made  one  of  the  great  bulwarks  of  the  standard  of 
life  of  the  working  class.^ 

The  administrative  machinery  intrusted  to  the  Board  of  Trade  is 
relatively  simple.  The  United  Kingdom  is  divided  into  eight  divi- 
sions, each  of  vvhich  has  charge  of  the  claims  in  its  district  and  super- 
vises the  placement  work  of  the  exchanges.  The  latter  handle  all  the 
initial  claims,  obtain  work  if  possible,  and  notify  the  divisional  office 
of  the  claim.  The  investigation  and  authorization  of  all  payments 
is  then  made  by  this  office,  which  notifies  the  local  exchange  whether 
or  not  benefit  is  payable.  The  exchange  then  acts  upon  this  notifi- 
cation. 

The  local  administration  is  controlled  through  Board  of  Trade 
regulations,  which  enunciate  the  procedure  followed  throughout  the 
Kingdom.  Further  power  is  centered  in  the  Board  of  Trade  in  its 
control  over  the  unemployment  fund,  subject  to  the  audit  of  the 
comptroller  and  auditor  general,  and  in  its  discretion  as  to  the  in- 
vestment of  the  funds  which  may  be  invested  by  the  national  debt 
commissioners. 

An  important  adjunct  in  the  administration  is  the  cooperation  of 
trade-unions  having  members  in  the  insured  trades.  Under  section 
105  of  the  act  an  "association  of  workmen"  may  make  arrangements 

^  New  Statesman,  August  i,  1914. 


BRITISH   UNEMPLOYMENT  INSURANCE 


65 


whereby  it  pays  to  its  members  the  benefit  they  would  have  received 
under  this  act.  Three  fourths  of  the  amount  so  paid  out  is  then  re- 
paid by  the  Board  of  Trade.  Such  an  arrangement  may  be  made 
only  on  the  condition  that  the  union  itself  pays  a  benefit  which  is  at 
least  one  third  of  the  state  benefit,  has  some  method  of  proving  the 
unemployment  of  its  members  and  of  notifying  them  of  vacant  posi- 
tions. In  practice  the  members  of  unions  with  such  an  agreement 
make  their  initial  claim  at  the  exchange  and  sign  the  union  vacant 
book,  which  may  be  kept  at  the  union  offices,  but  which  very  fre- 
quently is  found  at  the  exchange.  The  claim  is  then  forwarded  to 
the  divisional  office,  which  reports  to  the  exchange,  as  in  other  cases  ; 
the  exchange  then  notifies  the  union  secretary,  who  makes  the  pay- 
ment, as  to  whether  benefit  is  authorized.  Since  repayment  to  the 
union  is  made  only  for  benefit  which  the  labor  exchanges  would  have 
paid  if  the  claim  had  been  made  to  them,  it  is  important  that  the 
union  secretary  have  the  Board  of  Trade  authorization  for  each 
payment  made.  At  first  difficulties  were  encountered,  because  the 
warm-hearted  branch  secretaries  thought  that  they  could  pay  state 
benefit  with  the  same  freedom  with  which  they  were  accustomed  to 
pay  union  out-of-work  benefits ;  as  a  result  payments  were  made 
with  an  unjustified  expectation  of  a  refund  and  consequent  disap- 
pointment. It  not  infrequently  happened  that  failure  to  obtain  the 
anticipated  repayment  was  due  to  inaccurate  union  bookkeeping 
which  failed  to  pass  the  government  auditor. 

At  the  close  of  the  first  year,  July,  19 13,  one  hundred  and  five 
unions,  with  a  membership  of  539,775,  including  practically  all 
the  unions  in  the  insured  trades,  had  made  this  arrangement.  This 
plan,  necessitating  the  recording  of  union  payments  apart  from  those 
of  nonunion  men,  has  been  the  means  of  accumulating  valuable  in- 
formation as  to  the  incidence  of  unemployment  among  organized 
and  unorganized  workers.  During  the  first  year  of  benefits,  when 
union  men  numbered  approximately  25  per  cent  of  the  insured, 
union  claims  constituted  28  per  cent  of  the  total  and  absorbed 
26  per  cent  of  the  expenditures.  In  general  the  unemployment 
of  union  men  was  shorter  than  of  nonunionists — an  average  of 
12.2  days  as  against  16.2  days.  Since  August,  1914,  the  union  claims 
have  been  absorbing  a  phenomenally  increasing  proportion  of  the 
sum  spent  in  benefits,  amounting  to  47  per  cent  of  the  expenditure 


-^ki 


ri: 


II 


66         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

in  Januan-  and  February  of  191 6  and  falling  again  to  30  per  cent 
of  the  expenditure  in  August  of  191 6. 

The  cooperation  with  trade-unions  has  extended  to  all  unions 
giving  out-of-work  benefit  voluntarily  to  members.  Unions,  whether 
in  insured  trades  or  not,  may  receive  a  subsidy  of  one  sixth  of  the 
total  amount  expended  upon  out-of-work  benefits  up  to  a  maximum 
limit  of  175.  (S4.14),  including  the  75.  ($1.70)  of  state  benefit. 
Where  the  total  benefit  is  less  than  135.  ($3.16),  a  portion  of  the 
state  75.  (Si. 70)  is  excluded  in  reckoning  the  total. 

The  advantages  of  this  section  up  to  July,  19 13,  had  been  claimed 
by  103  unions  which  also  had  arrang'^ments  under  section  105,  and  in 
addition  by  172  unions,  with  a  membership  of  376,041,  in  the  nonin- 
sured  occupations.  A  few  of  the  large  unions,  such  as  the  Durham 
Miners'  Association  and  some  of  those  among  the  cotton  workers, 
have  hesitated  to  apply  for  the  subsidy  because  of  their  objection  to 
a  government  audit  of  this  expenditure  and  to  signing  an  unemploy- 
ment register. 

Less  difficulty  has  been  experienced  by  the  trade-unions  in  claim- 
ing this  refund,  because  the  requirements  are  not  as  stringent  as  those 
for  a  refund  under  section  105.  For  example,  the  statutory  qualifi- 
cations are  not  required  in  this  instance ;  all  that  is  necessary  is  for 
the  union  to  certify  that  unemployment  is  not  due  to  a  trade  dispute. 
The  accounts  of  this  expenditure  are  then  subject  to  government  audit 
before  repayment.  The  ease  with  which  unions  have  obtained  the 
refund  has  been  accompanied  by  departmental  difficulties.  Objec- 
tion was  raised  by  the  war-time  committee  on  retrenchment  in  public 
expenditure  that  many  claims  had  been  paid  without  detailed  evi- 
dence as  to  their  accuracy.  The  absence  of  a  receipt  from  the  work- 
man that  he  had  received  this  benefit  and  the  general  lack  of  proof 
that  unemployment  had  come  within  the  prescribed  limitations  in- 
creased the  difficulties  of  the  committee  on  public  accounts  in  passing 
claims  for  repayment.  As  a  result  the  audits  have  been  slow,  and 
amounts  have  been  paid  over  to  associations  for  which  there  was  no 
proof  of  correct  payment.  Dissatisfaction  extended  to  the  treasury, 
which  felt,  according  to  the  committee  on  public  accounts,  that  a 
more  satisfactory  basis  should  be  worked  out  by  a  special  committee. 

A  marked  reduction  in  the  parliamentary  appropriation  for  this 
purpose  was  presented  in  the  budget  for  191 6-19 17.    Instead  of  the 


BRITISH  UNEMPLOYMENT  INSURANCE 


67 


annual  sum  of  £70,000  ($340,655)  set  aside  during  the  first  two  years 
and  of  £100,000  ($486,650)  for  the  year  1915-1916,  only  £25,000 
($121,662.50)  appeared  in  the  budget  estimates  for  1916-1917.  The 
combined  result  of  this  dissatisfaction,  of  the  exceptional  prosperity 
during  the  war,  and  of  the  insistent  demand  for  national  economy  has 
been  the  withdrawal  of  the  subsidy  of  one  sixth  after  May  31,  19 16. 
Protests  have  been  made  and  a  deputation  from  the  trade-union 
congress  sought  an  explanation  from  the  Board  of  Trade.  They  were 
told  that  nothing  would  be  done  during  the  present  period  of  pros- 
perity, but  that  the  question  would  be  reconsidered  "when  trade 
resumed  its  normal  aspect." 

The  war  has  brought  its  own  peculiar  problem  as  to  the  insurance 
act.  In  the  early  fall  of  1914,  after  the  unemployment  rate  had  taken 
a  suddenly  alarming  upward  trend,  the  Board  of  Trade  announced 
that  it  would  give  an  additional  subsidy  to  trade-unions  paying  out- 
of-work  benefits.  Grants  were  to  be  made  upon  the  condition  that 
there  was  abnormal  unemployment  among  its  members,  that  the  asso- 
ciation was  not  paying  out  more  than  17  s.  (S4.14)  weekly  in  benefits, 
including  the  state  75.  (Si. 70),  and  that  the  union  would  impose  a 
special  levy  upon  its  employed  members.  The  amount  of  this  emer- 
gency grant  was  set  at  one  third  or  one  sixth  of  the  benefits  (in 
addition  to  the  refund  of  one  sixth  already  provided  in  the  act), 
depending  upon  the  amount  of  the  weekly  levy.  Applications  for 
this  emergency  grant  were  made  by  185  associations,  with  284,297 
members.  Of  these,  135  unions  (with  221,413  members)  were  in 
the  cotton  trade.  This  grant  in  aid  was  paid  for  expenditure  in- 
curred up  to  the  close  of  May,  191 5,  when  a  total  of  £84,175  (S409,- 
637.64)  had  been  expended.  Of  this  sum  £70,565  ($343,404.57) 
was  paid  to  unions  in  the  textile  trades,  many  of  which  had  held 
aloof  from  the  grant  of  one  sixth  under  section  106  of  the  act. 

Unemployment  insurance  has  opened  the  way  for  dealing  with  the 
unemployment  problem  anticipated  on  the  close  of  the  war.  The  war 
office  announced  that  it  had  undertaken  to  pay  unemployment  insur- 
ance benefits  for  one  year  to  those  who  would  be  discharged  from  the 
army,  regardless  of  the  trades  they  entered.  The  Admiralty  have  had 
a  similar  plan  under  consideration.  In  the  meantime  an  amending 
act  was  passed  in  July  of  191 6  extending  the  provisions  of  the  act 
to  those  engaged  in  munition  work  ;  in  sawmilling,  including  machine 


I 


i  i 


?  J  ' 


f 


68         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

woodwork  and  the  manufacture  of  wooden  cases  ;  in  the  manufacture 
of  chemicals,  including  oils,  lubricants,  soaps,  candles,  chemicals, 
paints,  and  varnishes  ;  the  manufacture  of  metals,  of  rubber  and 
rubber  goods,  of  leather  and  leather  goods,  of  bricks,  cement,  and 
artificial  stone.  These  provisions  are  expected  to  include  an  addi- 
tional 1,500,000  workmen.  Extension  may  be  made  by  the  Board 
of  Trade  where  there  is  a  substantial  amount  of  war  work  being 
done  in  any  trade.  In  addition,  workmen  employed  in  an  establish- 
ment in  which  some  are  insured  may  elect  to  come  under  the  act, 
provided  the  employer  consents.  The  plan  which  came  into  opera- 
tion in  September  is  but  a  temporary  arrangement,  in  fo^ce  for  not 
more  than  five  years,  or  not  more  than  three  years  after  the  ter- 
mination of  the  war,  or  such  shorter  period  as  the  Board  of  Trade 
may  determine. 

The  finances  under  the  main  act  thus  far  have  proved  perfectly 
satisfactory.  These  are  based  upon  data  relating  to  the  unemploy- 
ment of  540,000  trade-unionists  in  the  insured  trades  over  a  period 
of  years,  data  which  showed  an  average  rate  of  unemployment  of  8.6 
per  cent,  or  26.8  days  a  year  after  an  actuarial  weighting.  The 
period  during  which  the  insurance  act  has  operated  has  been  one  of 
phenomenally  low  rate  of  unemployment ;  at  no  time,  except  during 
the  fall  of  1914,  has  the  rate,  minus  the  actuarial  weighting,  risen 
above  3  per  cent,  while  the  rate  for  19 16  has  fallen  to  a  fraction  of 
I  per  cent.  These  favoring  circumstances  have,  of  course,  colored 
the  entire  histor\^  of  the  act. 

The  total  income  of  the  first  year  (1912-1913)  was  £2,011,304 
($9,788,010.92),  of  which  £362,397  (Si,763.6o5)  was  expended  on 
benefits  and  administration,'  leaving  a  balance  of  £1,648,907 
($8,024,405.92)  for  investment.  The  second  year  (19 13- 19 14)  showed 
a  slight  increase  in  income— £2,497,160  ($12,152,429.14),  of  which 
£896,160  ($4,361,162.64)  was  spent  on  benefits  and  administration, 

iThis  does  not  represent  the  total  spent  on  administration,  since  the  major 
portion  is  included  in  the  annual  appropriations  for  labor  exchanges.  But  of 
the  total  appropriation  of  £1,167,962  ($5,683,887.07)  made  for  labor  exchanges 
and  insurance  during  1Q16-1Q17,  it  is  impossible  to  ascertain  the  amounts 
chargeable  to  the  respective  accounts.  A  substantial  share  of  the  administrative 
expense  attributable  to  insurance  is  covered  by  the  grant  of  10  per  cent  of  the 
income  derived  from  employers  and  workmen,  according  to  the  report  of  the 
committee  on   retrenchment  in  public  expenditure. 


BRITISH   UNEMPLOYMENT  INSURANCE  69 

leaving  a  balance  of  £1,601,000  ($7,791,266.50).  The  period  of 
industrial  activity  during  four  years  has  placed  the  fund  in  a 
strong  financial  position,  so  that  in  July  of  19 16  the  fund  had 
approximately  £6,700,000  ($32,605,550)   standing  to  its  credit. 

During  this  period  the  act  has  achieved  what  it  attempted  ;  namely, 
provision  of  relief  for  the  unemployed  upon  a  dignified  basis.    The 
benefit  afforded  within  the  limitations  of  the  act  proved  adequate  in 
a  study  of  130,000  cases  during  the  first  six  months  of  benefit. 
Aside  from  the   29  per  cent  of   the  unemployment   recorded   ac- 
counted for  by  the  waiting  week,  9  per  cent  which  was  not  covered 
by  benefit  was  almost  entirely  accounted  for  by  the  statutory  dis- 
qualifications.   Less  than  i  per  cent  of  unemployment  was  uncovered 
because  of  exhausted  benefits.    Although  the  small  proportion  re- 
maining without  the  scope  of  the  act  presents  a  flattering  picture, 
it  must  be  remembered  that  men  are  less  likely  to  claim  if  they 
have  exceeded  their  allotted  portion  of  benefit.   As  a  result,  men 
may  be  out  of  work  without  the  knowledge  of  the  Board  of  Trade. 
The  figures  are  further  colored  by  the  fact  that  they  are  taken  from' 
the  early  days  of  the  act,  before  many  had  had  an  opportunity  to 
exhaust  their  benefit. 

But  the  act  has  done  more :  it  has  encouraged  the  growth  of 
voluntary  provision.  During  the  initial  eighteen  months  twenty- 
one  trade-unions,  with  a  membership  of  86,000  in  the  insured  trades, 
which  formerly  paid  no  benefit,  began  an  out-of-work  benefit.  In 
practically  all  cases  the  total  benefits— including  the  state  75. 
($1.70)  — is  below  I2S.  ($2.92)  a  week.  The  subsidy  of  one  sixth 
to  other  trade-unions  has  proved  less  successful,  for  only  three 
trade-unions  outside  the  insured  trades  had  established  an  out- 
of-work  benefit  in  July,  1914.  The  explanation  of  this  is  two- 
fold :  first,  that  the  unions  which  had  not  had  this  benefit  feature 
previously  were  too  poor  to  afford  it  and,  second,  that  the  grant  has 
been  too  small  to  encourage  them  m  what  they  still  consider  a 
perilous  undertaking. 

The  grants  under  sections  105  and  106  have,  on  the  whole,  tended 
to  strengthen  the  financial  position  of  this  trade-union  benefit.  For 
example,  an  old  and  well-established  society,  such  as  the  Amalga- 
mated Society  of  Engineers,  added  the  state  benefit  to  its  own  of 
los.   ($2.43).    Other  societies   receiving   the   subsidy   of  one  sixth 


iMt 


i  i  i  t 

111    t 


70         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

have  increased  their  benefits,  as,  for  example,  the  British  Steel 
Smelters'  Association  and  the  Workers'  Union.  The  London  Society 
of  Compositors,  even  though  it  is  not  cordial  to  this  government 
activity,  considers  this  grant  an  aid  to  their  funds. 

Achievements  in  the  prevention  of  unemployment,  through  the 
pressure  of  insurance  contributions,  have  not  been  to  the  fore  in 
years  of  exceptional  prosperity.  The  possible  future  effect  of  the 
preventive  measures,  such  as  the  refund  to  employers  for  regular 
workmen,  the  higher  rate  for  casual  labor,  and  the  remission  of  the 
employers'  and  workers'  contributions  when  short  time  is  worked 
systematically  as  a  substitute  for  reduction  of  working  force  during 
a  time  of  trade  depression,  cannot  be  foretold  upon  the  basis  of 
four  years  of  feverish  industrial  activity  when  the  absence  of  pres- 
sure may  have  accounted  for  the  belief  of  employers  that  the  induce- 
ments offered  were  too  slight  to  have  any  effect. 

The  most  significant  testimony  of  the  success  of  the  new  method  of 
dealing  with  unemployment  as  an  industrial  problem  is  the  extension 
of  the  principle  of  insurance  to  meet  some  of  the  war-unemployment 
problems — the  unemployment  in  the  early  days  of  the  war,  that 
occurring  when  soldiers  are  discharged  from  the  front,  and  that  due  to 
the  cessation  of  war  orders.  It  is  a  method  which  has  commended 
itself  alike  to  the  government  official,  to  the  general  public,  and  to 
the  workingman,  who  prefers  this  provision  for  unemployment  on  a 
business  basis  to  the  humiliating  and  pauperizing  system  of  poor-law 
and  charitable  relief. 

[On  December  23,  1919,  an  unemployment  insurance  bill  esti- 
mated to  embrace  11,750,000  persons  was  introduced  in  the  British 
Parliament.  This  bill  would  repeal  existing  legislation  and  would 
build  up  a  more  extensive  plan  along  the  lines  adopted  in  the  legis- 
lation here  described.  It  is  proposed  that  the  rate  of  benefit  be 
increased  to  155.  per  week  in  the  case  of  men  and  1 2  s.  per  week  in 
the  case  of  women.  The  contributions  in  the  case  of  men  will  be 
at  the  rate  of  3^/.  per  week  from  both  men  workers  and  their 
employers  and  in  the  case  of  women  2^rf.  per  week  from  workers 
and  employers  each. — Ed.] 

Olga  S.  Halsey 

American  Association  for  Labor  Legislation 


ill! 


*I1 


TRADE-UNION  SICKNESS  INSURANCE^ 

■jV/TY  AFFILIATION  with  the  International  Typographical  Union 
-l^Vl  began  in  1887,  and  one  of  my  earliest  recollections  concerns 
the  troubles  attendant  upon  the  administration  of  the  Union's  sick- 
benefit  fund,  which  was  finally  abolished  because,  as  I  can  see  now, 
the  methods  of  administration  employed  were  not  correct.  There  was 
lack  of  precedent  and  experience  on  which  to  base  sick-benefit  laws, 
and  the  abuses  resulting  because  the  funds  were  not  properly  guarded 
caused  early  death  to  a  valuable  feature  of  union  policy. 

For  years,  both  as  member  and  officer,  I  was  opposed  to  trade- 
union-sick,  out-of-work,  and  other  relief  measures,  holding  that 
they  were  outside  the  trade-union  field,  which  should  be  restricted 
to  the  regulation  of  hours,  wages,  and  working  conditions.  How 
far  the  leaven  of  progress  has  worked  in  my  case  may  be  gauged 
by  the  relief  laws  now  on  the  books  of  the  International  Typo- 
graphical Union,  of  which  I  was  the  executive  officer  for  thirteen 
years ;  and  nearly  all  of  these  features  were  added  during  my  in- 
cumbency as  president.  I  will  refer  to  them  specifically  further  on. 
As  I  show  in  this  paper,  the  officials  of  the  great  trade-unions 
now  recognize  the  value  of  benefit  features  as  builders  of  unions,  as 
conservators  of  the  membership  of  these  unions,  entirely  aside  from 
their  assistance  to  the  members  as  safeguards  against  financial  loss 
during  physical  adversity. 

One  of  the  most  direct  benefits  which  a  trade-unionist  derives 
from  membership  in  his  organization  is  his  participation  in  the 
various  forms  of  insurance  which  are  open  to  him  by  virtue  of  such 
membership.  In  fact,  some  of  the  first  trade  societies  in  this  coun- 
try were  organized  primarily  as  friendly  and  benevolent  societies. 
During  the  latter  part  of  the  eighteenth  century  and  the  first  quarter 
of  the  nineteenth  the  modern  conceptions  of  wage  class  and  wage 

^From  American  Labor  Legislation  Review,  Vol.  IV  (1914),  pp.  82-91. 

71 


1^ !"' 


Illl 


72         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

earner  were  unknown,  because  there  had  not  yet  developed  a  dis- 
tinctive group  of  workmen  dependent  upon  wages  alone  for  their 
livelihood.  Capital  had  not  yet  learned  its  ability  to  control  and 
direct  industry.  The  master  workman  of  that  period  was  at  once 
workman,  employer,  and  merchant  capitalist.  He  owned  the  few 
necessary  tools,  purchased  the  raw  material,  hired  the  necessary 
help,  if  any,  to  aid  him  in  preparing  his  product  for  market,  and 
retailed  his  wares  to  his  customers.  Sometimes  he  worked  on  orders. 
In  either  case  he  dealt  only  with  the  producer  of  raw  material  and 
with  the  consumer  in  price  determinations  and  with  his  helpers  or 
journeymen  in  wage  determinations.  Since  it  was  the  expectation  of 
every  journeyman  some  day  to  become  a  master  workman,  and  since 
the  functions  of  master  and  journeyman  were  at  times  interchange- 
able, there  was  a  very  real  identity  of  interest  between  master  and 
man.  Instead  of  organizations  to  fix  wage  scales,  combinations  to 
fix  prices  were  more  pertinent.  These  were  not  uncommon.  But 
more  often  friendly  and  benevolent  societies,  including  in  their  mem- 
bership both  masters  and  journeymen,  were  developed  as  mutual  in- 
surance companies.  All  of  these  were  purely  local  in  their  jurisdiction, 
and  nationalization  was  not  even  considered. 

The  half  century  beginning  in  the  thirties  witnessed  revolution- 
ary changes  in  American  industrial  life.  The  merchant  capitalist, 
and  a  little  later  the  merchant  jobber,  appeared  to  exercise  the 
functions  of  middleman  between  the  producer  of  raw  material  and 
the  master  workman  on  the  one  hand  and  the  master  workman  and 
the  consumer  on  the  other.  This  made  of  the  master  workman  a 
mere  contractor.  By  playing  one  such  contractor  against  another 
in  receiving  bids  for  work,  the  merchant  capitalist  was  able  to  re- 
duce the  prices  which  he  paid.  The  contractor,  in  turn,  in  order  to 
keep  in  the  race  for  commissions,  shaved  the  wages  of  his  journey- 
men. This  forced  the  question  of  wages  ahead  of  all  other  consider- 
ations in  trade  organizations  and  relegated  the  fraternal  and  insurance 
features  of  the  earlier  friendly  societies  to  a  minor  position  in  their 

program. 

The  masters  retained  their  membership  in  these  new  societies 
until,  in  the  further  development  of  the  capitalistic  function,  they 
lost  their  identity  as  tool  and  machinery  owners  and  contractors  and 
became    instead    mere    superintendents.    By    this    time    the    trade 


TRADE-UNION  SICKNESS  INSURANCE 


73 


societies  had  begun  to  assume  many  of  the  earmarks  of  modern  trade- 
unions,  and  the  masters  either  withdrew  or  were  forced  to  resign 
from  membership.  During  this  period  many  of  the  benevolent  so- 
cieties relinquished  their  insurance  benefits  and  reorganized  as  trade- 
unions  ;  others  retained  their  benefits  and  added  restrictive  measures 
for  the  government  of  their  members.  Although  the  era  of  national- 
ization of  trade-unions  began  at  this  time,  the  insurance  features 
which  were  retained  from  the  earlier  societies  were  still  adminis- 
tered by  local  unions.  In  fact,  the  leaders  of  the  national  movement 
at  first  discouraged  benefits,  on  the  ground  that  the  development  of 
such  activities  would  hinder  the  enforcement  of  trade  regulations. 

In  the  present  period  of  our  industrial  life,  beginning  with  the 
last  quarter  of  the  nineteenth  century,  changes  have  been  largely 
of  degree  rather  than  of  kind.  The  capitalist  has  extended  his  ac- 
tivities and  with  them  his  power  to  direct  and  control  the  currents 
of  industry.  The  workman  has  become  more  wage  conscious  and 
has  banded  with  his  fellows  into  strong  national  unions  in  an 
effort  to  establish  and  maintain  standards  of  wages  and  working 
conditions.  With  this  emergence  of  a  group  of  workmen,  separate 
and  distinct  from  all  other  classes  in  their  primary  efforts  to  earn 
a  living,  have  appeared  problems  to  which  the  wage-earners  as  a 
class,  and  more  especially  as  members  of  a  particular  union,  have 
directed  their  attention. 

With  the  return  of  prosperity  following  the  close  of  the  Civil 
War,  this  new  element  in  the  industrial  population— the  trade- 
unionists — sought  for  means  by  which  they  could  insure  themselves 
a  place  of  increasing  importance  in  the  social  scheme.  Savings  banks 
grew  apace  and  mutual  insurance  societies  became  the  order  of  the 
day.  Of  the  enormous  flood  of  immigrants,  many  had  had  experience 
in  friendly  societies  in  England.  These,  together  with  those  Ameri- 
can trade-unionists  who  still  retained  their  faith  in  the  benefit 
systems  of  the  earlier  trade  societies,  succeeded  in  interesting  large 
nupibers  of  wage-earners  in  the  institution  of  mutual  insurance 
within  their  own  organizations.  They  were  aided  in  their  efforts 
by  the  public  opinion  of  the  time,  which  looked  to  the  trade-unions 
for  the  solution  of  the  problems  which  faced  the  wage-earners. 

Gradually  the  earlier  opposition  of  the  national  trade-union  lead- 
ers to  benefit  systems  was  either  broken  down  or  was  overridden, 


74 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


i 


ilM 


SO  that  by  1880  the  national  leaders  were  beginning  to  find  reasons 
why  benefit  clauses  should  be  incorporated  in,  rather  than  excluded 
from,  their  constitutions.  It  was  argued  that  beneficiary  features, 
whether  or  not  they  attracted  members  to  the  union,  undoubtedly 
helped  to  retain  them  during  a  period  when  they  might  otherwise 
withdraw  from  membership.  And  since  one  of  the  big  problems 
which  every  trade-union  must  face  is  the  prevention  of  declinations 
in  membership  during  industrial  disturbances,  this  new  theory  of 
benefits  was  not  without  its  effects. 

The  Granite  Cutters'  Union  was  the  first  national  union  to  adopt 
a  system  of  national  sick  benefits.  This  was  introduced  in  1877  and 
was  made  voluntary  in  its  operation.  The  plan  was  not  successful, 
and  the  sickness-insurance  association  was  dissolved  in  1888.  The 
first  national  union  to  inaugurate  a  compulsory  sick  benefit  was  the 
Cigar  Makers'  Union,  in  1880.  Its  success  was  immediate  and  its 
popularity  grew  rapidly.  The  German-American  Typographia  pro- 
vided in  its  first  national  constitution,  adopted  in  1873,  for  the  pay- 
ment of  sick  benefits  by  the  subordinate  unions.  This  system  proved 
unsatisfactory,  and  in  1884  the  national  sick  benefit  was  adopted. 
Other  prominent  unions  which  have  since  adopted  national  sick 
benefits  are:  Barbers,  1893;  Iron  Molders,  1896;  Tobacco  Work- 
ers, 1896  ;  Piano  and  Organ  Workers,  1896  ;  Pattern  Makers,  1898  ; 
Leather  Workers  on  Horse  Goods,  1898 ;  Boot  and  Shoe  Workers, 
1899 ;  Garment  Workers,  1900 ;  Plumbers,  1903.  Other  national 
unions  which  have  given  much  attention  to  the  subject  include  the 
Typographical  Union,  the  Brotherhood  of  Carpenters  and  Joiners, 
the  Painters,  the  Wood  Workers,  and  the  IMachinists. 

The  International  Typographical  Union  manifested  but  little  in- 
terest in  the  establishment  of  a  sick  benefit  prior  to  1892.  Since 
that  time  the  subject  has  been  discussed  at  several  national  conven- 
tions and  has  even  received  the  indorsement  of  international  officers 
of  the  Union,  but  the  proposal  has  been  defeated  in  convention. 
The  Union  Printers'  Home,  however,  cares  not  only  for  aged  mem- 
bers but  for  many  afflicted  with  diseases  of  the  respiratory  organs* 
Members  who  are  afflicted  with  disease  that  makes  their  admission 
to  the  home  inadvisable  are,  if  otherwise  eligible,  placed  on  the 
union's  pension  roll.  A  pension  of  S5  per  week  is  paid  to  all  in- 
capacitated members  sixty  years  of  age  or  over,  and  there  are  also 


TRADE-UNION  SICKNESS  INSUR.\NCE  75 

mortuary  benefits  ranging  from  $75  to  S400  according  to  length  of 
membership. 

It  is  not  possible  to  give  a  significant  summary  of  the  extent  of 
national  trade-union  sickness  insurance  in  the  United  States  at  the 
present  time.    Twenty-seven  of  the  unions  affiliated  with  the  Ameri- 
can Federation  of  Labor  paid  out  in  national  sick  benefits  during  the 
year  ending  September  30,   1913,  a  little  over  $800,000.    Of^'this 
amount  the  Cigar  Makers'  Union  alone  paid  out  $200,000.^    Be- 
cause this  union  best  shows  what  is  possible  in  national-union  sick 
insurance,  a  brief  statement  of  the  history  of  this  feature  of  the 
Union's  policy  is  pertinent  here.    Beginning  in   1881  with  a  total 
sick-benefit  payment  of  less  than  $4000,  the  annual  amount  has 
steadily  increased  until  in  19 11  it  for  the  first  time  reached  $200,000. 
The  per  capita  cost  of  this  sick  benefit  has  likewise  increased  from 
27  cents  in  1881  to  $3.73  in  1905,  since  which  time  it  has  remained 
nearly  constant,  although  during  the  last  two  years  it  has  been 
slightly  more  than  $4.    Every  member  of  the  Union  is  entitled  to 
participate  in  sick  benefits.    Members  leaving  the  trade  may  ob- 
tain a  trade  "retiring  card"  which  entitles  them  to  sick  benefits  as 
long  as  they  maintain  the  payment  of  a  certain  proportion  of  the 
regular  dues.    Sick  members  are  entitled  to  receive  $s  per  week  for 
a  period  not  to  exceed  thirteen  weeks  in  any  one  year ;  no  payments 
are  made  for  sickness  of  less  than  seven  days'  duration.    A  mem- 
bership of  one  year  is  required  before  the  member  is  entitled  to 
the  sick  benefit.    Sickness  caused  by  intemperance,  debauchery,  or 
immoral  conduct  is  not  accepted  as  a  cause  for  claiming  benefits! 

By  far  the  greater  proportion  of  trade-unionists  who  are  pro- 
tected by  sickness  insurance  receive  support  from  local  rather  than 
from  international  unions.  Of  the  530  local  unions  reported  in  the 

iThe  exact  figures  are:  Total  amount,  all  unions,  $816,336.41;  Cigar  Makers 
*204,77s.6i  ;  Molders,  $iS9,434  ;  Western  Federation  of  Miners,  $96,06644- 
Boot  and  Shoe  Workers,  $74,790.81  ;  Hotel  and  Restaurant  Employees  $58  - 
911.06;  Plumbers,  $47,000;  Barbers,  $46,185.91;  Bakers,  $33,870;  Tailors, 
$22,009.80;  Retail  Clerks,  $14,225;  Iron  and  Steel  Workers,  $10,515;  A.  F.  of  L 
locals,  $8813.06;  Photo  Engravers,  $7865.51;  Patternmakers,  $7053.04;  Painters' 
$6400;  Tobacco  Workers,  $5917  ;  Cloth  Hat  and  Cap  Makers,  $3859;  White 
Rats  Actors,  $2156.67;  Stonecutters,  $2000;  Diamond  Workers,  $1600  •  Steel 
and  Copper  Plate  Printers,  $1280;  Wire  Weavers,  $350.50;  Travelers'  Goods  and 
Leather  Novelty  Workers,  $300;  Foundry  Employees,  $245;  Shingle  Weavers 
$69 ;  Pocket  Knife  Blade  Grinders,  $54. 


k 


Ml 


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I 


76         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

volume  on  "  Workmen's  Insurance  and  Benefit  Funds  in  the  United 
States,"  prepared  in  1908  under  the  direction  of  the  United  States 
Commissioner  of  Labor,  308  pay  sick  benefits.  These  vary  from 
Si  to  Sic  per  week,  while  S5  per  week  is  the  amount  most  often 
paid.  The  maximum  periods  for  which  sick  benefits  are  provided 
vary  from  five  weeks  in  one  year  to  unlimited  time,  with  thirteen 
weeks  in  any  one  year  as  the  most  common.  Generally  the  period 
of  illness  must  continue  for  seven  days  or  more  at  any  one  time 
before  benefits  may  be  claimed.  The  number  of  days  at  the  be- 
ginning of  the  illness  for  which  benefits  are  not  paid  varies  from 
none  to  twenty-one,  while  seven  is  the  most  common.  The  length 
of  membership  required  in  order  to  establish  a  right  to  claim  bene- 
fits for  sickness  varies  from  no  time  at  all  to  one  year,  with  six 
months  the  most  common.  Most  unions  require  the  presentation 
of  physicians'  certificates  and  the  investigation  of  sick-benefit  claims 
by  union  sick  committees. 

While  the  International  Typographical  Union  does  not  maintain 
a  national  sick-benefit  fund,  its  local  branches  have  perfected  three 
separate  forms  of  insurance  against  illness.  These  may  be  called 
the  local-union  sick-benefit  insurance,  the  union-auxiliary  mutual- 
aid  insurance,  and  the  union  chapel  or  shop  insurance.  The  first 
of  these  —  the  union  sick-benefit  insurance — is  typified  in  the  con- 
stitution of  St.  Louis  Typographical  Union  No.  8.  All  members 
of  this  union  who  have  been  in  continuous  good  standing  for  six 
months  and  who  are  incapacitated  for  work  for  a  period  of  two 
weeks  or  longer  are  entitled  to  receive  from  the  Union  a  weekly 
benefit  of  $5  for  a  period  not  to  exceed  twelve  weeks  in  any  one 
year.  If  the  illness  is  of  such  a  nature  as  to  require  hospital  ac- 
commodations, the  Union  stands  ready  to  pay  hospital  charges  dot 
to  exceed  S7  per  week  in  lieu  of  the  weekly  sick  benefit.  Neither 
sick  nor  hospital  benefit  is  extended  to  cases  of  alcoholisn-i'  or  to 
cases  of  chronic,  contagious,  or  venereal  disease. 

The  second  form  of  sickness  insurance  among  printers' — the 
union-auxiliary  mutual-aid  insurance — is  represented  in  the  Chicago 
Union  Printers'  Mutual  Aid  Society.  This  society  is  a  mutual  in- 
surance association  organized  solely  for  the  purpose  of  giving  tinan- 
cial  aid  and  assistance  to  its  members  in  time  of  sickness  or  acci  dent. 
No  person  is  eligible  to  membership  who  is  not  already  a  member  in 


TRADE-UNION  SICKNESS  INSURANCE  77 

good  standing  of  Chicago  Typographical  Union  No.  16.  Members 
when  sick  are  entitled  to  receive  S 10  per  week  for  a  period  not  to 
exceed  twenty-six  weeks  in  any  one  year,  provided  their  illness  lasts 
for  two  weeks  or  longer.  Membership  in  this  society  is  voluntary 
and  is  not  required  of  members  of  Typographical  Union  No.  16. 
Nevertheless,  the  Union  encourages  its  members  to  join  the  society, 
and  to  effect  this  end  it  has  abolished  all  union  relief  in  case  of 
sickness,  except  to  those  members  whose  applications  for  member- 
ship in  the  society  have  been  rejected  on  account  of  their  inability 
to  pass  the  required  medical  examination.  In  such  cases  the  union 
may  grant  relief  by  extending  a  loan  of  not  more  than  $25  in 
ordinary  cases  to  sick  and  destitute  members. 

For  an  example  of  the  third  form  of  printers'  sick  benefits— the 
union  chapel  or  shop  insurance  — we  may  refer  to  the  Composing- 
room  Relief  Association  of  the  New  York  World.  Perhaps  it  is  not 
quite  accurate  to  call  this  association  a  union  insurance  society, 
since  membership  in  a  union  is  not  required  of  all  members  in  the 
association.  Yet  we  call  this  a  form  of  union  chapel  or  shop  in- 
surance, because,  except  for  this  omission,  it  typifies  that  group  of 
chapel  and  shop  insurance  organizations  which  do  require  of  appli- 
cants for  membership  the  presentation  of  a  union  card.  This  asso- 
ciation was  organized  originally  for  the  benefit  of  compositors  alone, 
but  it  now  includes  among  its  500  members  editors,  writers,  employees 
of  the  business  and  circulation  departments,  stereotypers,  press- 
men, and  mailers  as  well.  Upon  the  payment  of  weekly  dues  of 
fifty  cents,  its  members  when  sick  are  entitled  to  receive  $10  per 
week  for  a  period  not  to  exceed  twenty-six  weeks  in  any  one  year. 
Under  certain  conditions  the  dues  may  be  increased  in  individual 
cases  to  Si  or  Si. 50  per  week  and  the  benefits  to  S20  or  S30  per 
week  accordingly. 

Wheth.-r  administered  by  the  international  union  or  by  the  subor- 
dinate locals,  the  sick  benefit  is  intended  to  provide  insurance  against 
illness  which  temporarily  incapacitates  the  wage-earner  for  his  regu- 
lar work.  Members  are  usually  debarred  from  such  benefits  in 
case  of  illness  due  to  "intemperance,  debauchery,  or  other  immoral 
conduct";  and  in  some  cases  illness  caused  by  "the  member's 
own  act"  may  not  be  used  as  a  basis  for  benefit  claims.  In  no  case 
is  the  sick  benefit  intended  to  constitute  a  pension  for  members 


: 


I 


78         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

suffering  from  chronic  disability.  The  time  limit  during  which  a 
member  may  receive  insurance  in  any  one  year  prevents  this.  Some 
of  the  unions,  notably  the  Iron  Molders  and  the  Boot  and  Shoe 
Workers,  go  even  further  and  provide  for  retiring  such  members 
from  the  privilege  of  sick  benefits  in  case  they  attempt  to  draw 
the  maximum  amount  year  after  year. 

The  limelight  of  publicity  has  been  turned  upon  industrial  acci- 
dents and  occupational  diseases.  As  a  result,  individual  students  of 
social  problems,  philanthropic  organizations,  and  state  and  national 
departments  of  labor  are  beginning  to  learn  about  the  hazards  of 
industrial  life.  The  more  knowledge  we  obtain,  the  more  eager  we 
are  to  embody  it  into  measures  which  will  prevent  such  accidents, 
do  away  with  the  necessity  for  exposure  to  occupational  diseases, 
and  compensate  the  sufferer  and  his  family.  Our  former  insistence 
upon  the  competence  of  voluntary  action  to  deal  with  accidents  and 
diseases  in  which  the  factor  of  the  inherent  risks  of  the  industry  is 
so  great  is  being  displaced  by  a  belief  in  the  necessity  for  com- 
pulsory insurance  administered  by  governmental  authority.  Fol- 
lowing closely  upon  the  heels  of  the  demand  for  compensation 
legislation  is  the  cry  for  old-age  pensions,  mothers'  pensions,  and  a 
host  of  other  reforms  which  abroad  have  already  become  realities, 
but  which  in  America  are  just  being  divested  of  the  stigma  of 
socialism  and  paternalism. 

In  some  of  these  proposed  reforms  it  is  not  very  easy  to  trace  a 
causal  relationship  between  the  condition  which  demands  a  remedy 
and  society's  responsibility  for  that  condition.  Still  more  difficult 
is  it  to  measure  social  responsibility  in  considering  what  we  are 
accustomed  to  call  the  private  misfortune  of  ordinary  illness.  But 
the  fact  remains  that  we  are  forced  to  recognize  the  presence  of 
a  vast  deal  of  sickness  among  wage-earners,  against  which  no  pro- 
vision has  been  made  and  for  which  relief  is  necessary.  Some  day 
we  may  be  asked  to  provide  compulsory  state  or  national  insurance 
against  this  also.  At  present  we  must  look  to  other  agencie...  The 
trade-union,  and  especially  the  international  union,  is  peculiarly 
fitted  to  administer  sickness  insurance.  For  the  most  part,  each  local 
union  is  made  up  of  people  of  the  same  nationality,  of  similar  habits 
of  life,  resembling  each  other  in  physical  make-up,  and  subject 
to  similar  risks  and  exposures.    They  know  one  another  personally 


^ 


TRADE-UNION  SICKNESS  INSURANCE 


79 


and  are  able  to  detect  imposture  in  the  rare  cases  where  this  is 
attempted.  Then,  too,  sickness  insurance,  when  conducted  on  the 
local  mutual  plan,  requires  neither  large  reserves  nor  a  great  invest- 
ment of  funds.  When  conducted  by  an  international  union,  there  is, 
of  course,  need  for  a  reserve  fund,  and  there  is  also  greater  care 
and  more  approved  business  methods  in  the  disbursement  of  money. 
Therefore,  whatever  may  be  our  ideas  of  the  activity  of  govern- 
mental agencies  in  other  forms  of  industrial  insurance,  we  must 
admit  that  for  the  present  at  least  we  are  not  ready  for  the  state  to 
insure  our  wage-earners  against  sickness.  We  must  also  recognize 
that  at  present  wage-earners  as  a  class  cannot,  or  at  least  do  not, 
make  individual  provision  for  temporary  disability  due  to  illness. 
What  is  not  done  individually  must  be  done  collectively  if  at  all. 
It  is  for  these  reasons  that  we  believe  in  trade-union  sickness  in- 
surance and  that  we  are  ready  to  offer  it  encouragement. 

Judging  from  some  of  the  opinions  expressed  here  today,  there 
may  be  criticism  of  trade-union  sick-insurance  methods  on  the 
ground  that  all  of  the  funds  are  contributed  by  employees,  the  em- 
ployer not  bearing  a  share  of  the  expenditures.  From  a  somewhat 
extended  experience  it  is  my  conviction  that  in  a  well-organized 
industry  the  employer  does  contribute, — indirectly,  it  is  true,  but 
actually  none  the  less, —  for  the  cost  to  the  union  member  is  later 
used  by  the  union  as  an  argument  for  an  increased  wage  scale,  and 
is  so  accepted  by  employers,  in  the  printing  industry  at  least.  All 
the  benevolent  features  of  the  International  Typographical  Union, 
including  the  pension  fund  from  which  iioo  members  are  now 
drawing  pensions,  the  mortuary  fund,  and  the  Union  Printers'  Home, 
are  supported  by  the  members. 

It  was  said  here  today  that  compulsory  insurance  is  never  en- 
thusiastically supported.  Thousands  of  our  members  voted  against 
the  mortuary  and  pension  laws ;  but  the  majority  vote  was  for  these 
laws,  and  they  are  compulsory.  They  have  been  in  effect  for  several 
years,  and  if  they  were  resubmitted  now,  I  am  satisfied  that  there 
would  be  a  comparatively  small  vote  against  them. 

As  far  as  a  joint  fund  for  such  benefits  is  concerned,  I  am  satis- 
fied that  even  with  a  board  of  directors  of  seven  twelfths  for  the 
employees  and  five  twelfths  for  the  employer,  the  latter  would  dic- 
tate the  policies  and  control  the  fund.   Naturally  the  wage-earners 


ilii 


80 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


til 


t!H 


t 


MH 


lilt 


look  askance  at  these  company-instituted  and  company-controlled 
funds,  as  they  give  the  impression  that  they  are  instituted  in  order 
that  the  worker  may  be  more  firmly  bound  to  the  industry  and  less 
liable  to  form  industrial  organizations  for  the  regulation  of  hours, 
wages,  and  working  conditions.  I  am  opposed  to  any  scheme  which 
takes  out  of  the  pay  envelope  the  "contribution"  of  the  employee. 
He  should  receive  his  wages  in  full. 

A  strong  union,  capable  of  protecting  the  rights  of  the  individ- 
ual, can  successfully  conduct  sick-insurance  features.  Unorganized 
workers  will  find  their  best  protection  in  state-supervised  or  state- 
instituted  sickness  insurance,  for  they  will  not  then  be  at  the  mercy 
of  the  rapacity  or  greed  or  kindness  or  charity  of  the  employer. 
The  state,  and  not  mixed  directorates,  will  see  that  full  and  even 
justice  is  accorded. 

With  the  general  adoption  of  compensation  for  industrial  acci- 
dents will  come  reasonably  safe  factories,  for  these  laws  will  do 
as  much  for  safety  as  the  inspection  service  of  the  state  departments 
of  labor.  Properly  guarded  machinery  will  mean  a  lower  insurance 
rale.  Following  compensation  for  industrial  accidents  will  come 
compensation  for  industrial  diseases,  and  this  will  in  turn  mean 
reasonably  safe  factories  from  a  health  standpoint.  Both  will  raise 
the  standard  of  living,  and  a  higher  standard  of  living  will  mean  a 
healthier  people  and  less  sickness  of  a  general  nature. 

Pay  to  the  wage-earners  living  wages  and  give  them  the  eight- 
hour  day,  and  they  will  spend  their  money  wisely  and  provide  their 
own  health  insurance.  There  will  then  be  no  occasion  for  worry 
on  the  part  of  those  employers  who  may  have  the  idea  that  they 
are  the  natural  guardians  and  protectors  of  their  workpeople,  and 
who  seek  to  mold  laws  accordingly. 

James  M.  Lynch 


Industrial  Commission  of  New  York  * 


VI 

HEALTH  PROGRAM 


THE  campaign  against  tuberculosis  has  given  to  the  American 
people  a  new  idea  of  the  doctor.  We  had  thought  of  him  as  a 
last  resort  after  we  had  doctored  ourselves  and  tried  out  the  patent 
medicines  and  practiced  faith.  The  antituberculosis  movement  has 
begun  to  show  us  that  the  doctor  should  be  first.  We  know  that  we 
need  him  in  sickness.    We  begin  to  want  him  also  to  prevent  sickness. 

Likewise,  the  workingmen's  accident-compensation  laws  have  given 
us  a  new  idea  regarding  insurance.  We  got  our  idea  of  insurance  from 
life  insurance.  Death  is  inevitable,  and  the  purpose  of  life  insurance 
is  the  philanthropic  purpose  of  paying  uncertain  but  unavoidable 
expenses  when  dead.  So  we  thought  that  accidents  were  inevitable, 
and  that  the  purpose  of  accident  insurance  was  the  philanthropic 
purpose  of  relief  to  injured  workmen  and  to  the  families  of  killed 
workmen.  But  the  compensation  laws  have  shown  us  that  accidents 
are  largely  preventable  and  that  employers  can  prevent  them.  So 
we  have  learned  to  think  that  the  first  purpose  of  accident  insurance 
is  the  business  purpose  of  making  money  by  preventing  accidents. 

These  compensation  laws  have  a  double  mechanism.  They  are 
an  employer's  tax  on  accidents  and  a  workman's  insurance  against 
unprevented  accidents.  Employers  can  escape  the  tax,  and  thus  cut 
down  the  cost  of  compensation,  by  preventing  accidents.  There  are 
records  of  employers  who  have  reduced  accidents  90  per  cent.  Some 
of  them  affirm  that  the  money  put  into  accident  prevention  is  the 
most  profitable  part  of  their  business. 

So  a  new  profession  has  sprung  up.  Or,  rather,  those  persons  who 
formerly  practiced  the  profession  of  claim  agent,  for  the  purpose  of 
protecting  their  employers  against  lawsuits,  have  become  safety  ex- 
pertSy  and  they  now  protect  their  employers  against  the  tax  on 
accidents,  by  preventing  the  accidents. 

^  By  J.  R.  Commons.  Address  delivered  at  Fifteenth  Annual  Meeting,  Na- 
tional Tuberculosis  Association,  June,  1919. 

Si 


82         TRADE  UNIONISM  AND  LABOR  PROBLEMS 


ll 


' 

, 


I  sometimes  think  it  is  more  difficult  to  persuade  the  average  doctor 
to  become  a  health  expert  and  to  prevent  sickness  than  it  was  to 
convert  the  claim  agent  into  a  safety  expert  to  prevent  accidents. 
As  a  matter  of  fact,  the  claim  agent  fought  the  process  of  conversion 
about  as  stiffly  as  he  could,  and  it  was  only  the  overwhelming  power 
of  a  tax  on  accidents  that  converted  him.  Now  he  is  proud  of  his 
new  profession,  and  his  employer  is  proud  of  him.  I  occasionally 
hear  of  employers  who  say  what  fools  they  were  in  fighting  accident 
compensation.  The  new  thing  certainly  did  look  bad  for  them  at  the 
time.  But  they  are  escaping  the  tax  on  accidents  by  devoting  the 
same  kind  of  business  ability  to  preventing  accidents  that  they  had 
devoted  to  manufacturing  and  selling  their  product.^ 

It  is  much  the  same  with  the  proposed  business  tax  on  sickness. 
We  read  of  the  probable  enormous  cost  to  industry  of  compulsory 
health  insurance.  It  looks  like  bankruptcy.  I  am  willing  to  accept 
the  figures.  They  are  presumably  based  on  the  existing  amount  of 
sickness,  although  the  same  insurance  experts  turn  around  and  say 
there  is  not  much  sickness  anyhow. 

The  explanation  is  rather  simple.  They  fail  to  distinguish  philan- 
thropy from  business.  If  this  large  amount  of  sickness  is  unprevent- 
able,  then  the  cost  of  relief  to  the  sick  in  a  proper  humanitarian  way 
will  doubtless  be  very  great.  But  if  it  is  largely  preventable,  then 
the  proper  American  way  is  to  offer  to  our  business  men  a  chance  to 
make  a  big  profit  by  preventing  it. 

I  believe  our  business  men  have  more  business  ability  than  those 
of  other  countries.  They  are  ingenious,  alert,  they  take  chances,  and 
they  know  how  to  employ  experts  to  work  out  the  technical  details. 
In  these  respects  they  are  also  quite  superior  to  our  politicians  and 
other  government  officials.  It  is  a  curious  fact  that  our  insurance 
experts,  who  try  to  prove  to  us  that  the  purpose  of  insurance  is  not 
prevention  but  relief,  wish  to  turn  over  the  prevention  of  sickness  in 
industry  not  to  our  business  men  who  control  the  industry  but  to 
our  politicians.  They  give  us  attractive  programs  of  public-health 
administration,  of  great  and  efficient  federal,  state,  and  municipal 
health  departments,  of  public-health  nurses,  of  city  and  county  san- 
atoria, hospitals,  and  clinics,  of  state  health  inspectors  and  state  and 
municipal  factory  inspectors  going  into  the  homes  and  factories  and 

1  See  above,  p.  9. 


m 


HEALTH  PROGRAM 


83 


vigorously  enforcing  a  long  list  of  beneficent  sanitary  laws  and  health 
laws  and  factory-inspection  laws. 

Well,  we  had  a  good  deal  of  experience  along  this  line  in  enforcing 
the  factory-inspection  laws  which  require  safeguards  on  machinery 
as  protection  against  accidents.  The  factory  inspector's  job  was  a 
very  disagreeable  and  even  heroic  job.  Occasionally  he  was  kicked 
out  by  an  employer,  or,  if  not  kicked  out  of  the  factory,  was  inscru- 
tably lifted  out  of  his  job.  He  had  to  collect  evidence  of  violations 
of  law,  and  this  evidence  had  to  be  sufficient  to  prove  to  a  judge  and 
jury  that  the  employer  was  a  petty  criminal,  and  the  law  gave  to  the 
criminal  the  benefit  of  every  doubt.  Thus  the  factory  inspector  was 
strung  along  the  rocky  career  of  a  detective,  sneaking  in  where  he 
was  not  wanted,  or  hustled  past  the  dangerous  machinery,  and  it  is 
no  wonder  that  many  of  them  became  blind.  Even  if  they  did  see 
things,  very  little  accident  prevention  came  out  of  it.  The  successful 
factory  inspector  was  the  one  who  held  his  job,  not  the  one  who 
prevented  accidents. 

All  of  this  was  greatly  changed  when  workmen's  compensation, 
with  its  tax  on  accidents,  came  in.  Now  the  employer  is  not  treated 
like  a  criminal ;  he  is  a  taxpayer.  But — unlike  some  other  taxes — 
he  is  allowed  to  make  money  by  evading  this  tax.  So  he  eagerly 
invites  the  inspector  to  come  in  and  show  him  how  to  escape  the  tax 
by  preventing  the  accidents. 

But  he  finds  that  the  old-time  political  inspector  cannot  see.  What 
the  employer  wants  is  not  a  detective  anyhow,  he  wants  a  safety 
expert.  So  he  hires  his  own  expert,  starts  a  nation-wide  "safety 
first"  campaign,  cultivates  the  "safety  spirit"  in  his  employees  and 
in  the  public. 

Then,  behold,  the  factory  inspector  also  begins  to  be  transformed. 
It  is  remarkable  what  influence  business  men  have  on  government  at 
the  points  where  they  can  make  a  profit  or  avoid  a  loss.  In  the  midst 
of  even  the  most  corrupt  municipal  politics  they  nearly  always  suc- 
ceed in  having  an  efficient  fire  department.  I  do  not  know  of  any 
workingmen  or  experts  in  public  or  private  employment  who  have 
a  greater  pride  in  their  job,  or  greater  efficiency,  than  the  city  fire- 
men and  fire  chiefs.  It  is  because  business  makes  money  by  them. 
And  so  with  the  factory  inspectors.  When  business  men  want  factory 
inspectors  to  be  made  exempt  from  politics,  because  they  want  them  to 


84 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


HEALTH  PROGRAM 


\\\ 


help  keep  down  the  accident  tax  on  business,  then  the  factory  inspec- 
tor becomes  a  new  man.  Government  itself  becomes  better,  for 
government-in-action,  at  this  point,  is  the  factory-inspector-in-action. 

Consequently  I  offer  no  objection  to  the  health  program  of  the 
insurance  experts  who  would  turn  over  sickness  prevention  to  the 
politicians.  I  see  a  great  opportunity  to  improve  politics,  to  enlarge 
and  improve  our  health  departments,  and  thus  to  prevent  sickness. 
But  I  do  not  see  it  effective  and  on  a  sufficiently  large  scale  until 
sickness  prevention  is  made  a  source  of  financial  profit  to  business 
men. 

This  is  what  is  intended  in  the  program  of  health  insurance.  There 
is,  of  course,  also  a  philanthropic  purpose  in  that  program,  but  that 
philanthropic  purpose  is  really  secondary.  The  main  purpose  is  the 
business  purpose  of  making  sickness  prevention  profitable.  There 
does  not  seem  to  be  any  other  way  of  reaching  all  of  our  business 
men,  as  well  as  workingmen.  Many  of  our  big  corporations  have 
begun  to  take  hold  of  sickness  prevention.  They  look  on  it  as  a 
business  proposition  and  they  resent  the  name  sometimes  given  to  it 
of  "welfare  work."  The  difficulty,  however,  is  that  it  is  not  universal 
and  they  do  not  put  enough  business  ability  into  it.  One  reason  is 
that  it  is  too  easy  to  shift  the  entire  cost  of  sickness  over  to  the 
workingman  and  his  family.  The  thing  works  automatically.  When 
the  workman  gets  sick  he  just  lays  off  on  his  own  initiative  and  pays 
his  own  bills  if  he  can,  and  somebody  else  takes  his  place. 

But  health  insurance  is  a  follow-up  proposition.  The  employer 
cannot  shift  the  entire  cost  over  to  the  workmen,  but  must  share  the 
cost  of  doctors  and  nurses  and  hospitals  and  medicines  and  must 
continue  to  pay  a  part  of  the  worker's  wages  even  when  absent  from 
work.  It  is  a  sickness  tax  on  industry,  coupled  with  an  insurance 
scheme  in  order  to  spread  the  tax  over  the  industry  and  over  a  period 
of  time.  But  since  the  industry  is  not  solely  responsible  for  sickness, 
the  workman  also  is  required  to  contribute  to  the  insurance  fund,  and 
a  part  of  the  tax  is  thereby  spread  out  over  his  wages. 

If  it  were  not  that  several  large  corporations  have  already  volun- 
tarily adopted  this  plan  of  health  insurance  and  set  the  example,  we 
could  not  know  certainly  how  it  would  work.  But  we  do  know,  from 
their  example,  that  it  prevents  sickness.  I  know  such  a  corporation 
that  has  reduced  the  number  of  days  lost  on  account  of  sickness  one 


85 


half,  and  the  resultant  increase  in  wages  and  the  increase  in  efficiency 
of  workers  has  been  much  greater  than  the  total  cost  of  the  insurance. 

Another  corporation  figured  that  they  stood  to  lose  $600  on  the 
average  on  account  of  their  workmen  who  came  down  with  tuber- 
culosis, because  they  had  undertaken  to  provide  sanatoria  for  the 
cure  of  their  tuberculous  workmen  and  cash  benefits  for  their  families 
while  getting  cured.  They  could  save,  on  the  average,  $600  if  they 
could  detect  incipient  tuberculosis  before  anybody  suspected  it.  They 
had  voluntarily  taxed  themselves  for  the  cure  of  tuberculosis  and 
then  saved  a  large  part  of  the  tax  by  preventing  it. 

Another  corporation,  which  furnishes  physicians  and  nurses  free 
to  its  employees,  finds  that  where  six  years  ago  75  per  cent  of  their 
time  was  spent  in  airing  sickness  and  only  2  5  per  cent  in  preventing 
it,  now  they  spend  75  per  cent  of  their  time  in  preventing  sickness, 
and  only  25  per  cent  is  needed  for  the  cure  of  it.  This  company  ap- 
propriates $60,000  a  year  to  its  medical  department,  and  out  of  this 
budget  has  saved  enough  money  in  one  year  to  procure  and  equip 
what  they  call  a  "Rest  Home,"  where  employees  below  par  may  go 
and  recuperate  at  the  expense  of  the  company. 

Other  examples  like  these  might  be  given.  They  are  convincing 
and  conclusive.  When  business  men,  for  the  sake  of  increasing  the 
efficiency  of  their  employees,  voluntarily  tax  themselves  for  the  cure 
of  sickness,  they  end  by  preventing  it.  If  other  business  men,  not  as 
progressive,  are  taxed  by  law  for  the  cure  of  sickness,  then  business 
ability  will  find  abundant  means  of  preventing  sickness. 

Here  is  the  big  inducement  for  a  public-health  program.  Not  many 
corporations  are  big  enough,  not  farseeing  enough,  to  tax  themselves 
voluntarily,  as  these  have  done,  for  the  support  of  hospitals  and 
sanatoria,  clinics,  doctors,  and  nurses.  The  overwhelming  majority 
of  business  men  must  depend  on  the  public-health  authorities  for  this 
assistance.  And  they  will  not  seriously  look  for  this  assistance  until 
they  are  taxed  by  law  for  the  sickness  that  they  have  not  prevented. 

The  other  method  of  starting  a  health  program  is  to  start  it  before 
there  is  a  business  demand  for  it.  Mr.  Hoffman,^  for  example,  says 
that  the  "American  Association  for  Labor  Legislation  could  not 
better  serve  the  interests  of  American  labor  than  by  exerting  itself 

^  See  F.  L.  Hoffman,  Facts  and  Fallacies  of  Compulsory  Health  Insurance, 
P-4S. 


H 


1    ! 


I 


86        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

effectively  in  behalf  of  the  enactment  and  enforcement  of  legislation 
providing  more  efficient  governmental  supervision  and  control  of 
the  dusty  and  other  trades  and  occupations  predisposing  to  an  ex- 
cessive morbidity  and  mortality  from  pulmonary  tuberculosis." 

But  what  does  the  "enactment  and  enforcement"  of  such  legis- 
lation signify?  It  signifies  increasing  the  number  of  petty  criminals 
among  business  men.  It  is  rather  odd  that  a  person  who  is  so  greatly 
disturbed  about  what  he  calls  "paternalism"  and  "  state  socialism" 
and  "class  legislation"  and  the  "menace  of  coercive  laws"  should 
find  himself  calling  for  laws  to  increase  the  criminality  of  business 
men.  I  suppose  it  is  not  class  legislation  to  make  petty  criminals 
out  of  employers  for  the  sake  of  their  employees,  but  it  is  class 
legislation  to  tax  them  on  behalf  of  their  employees.  I  suppose  it  is 
not  "paternalism"  to  punish  your  child  for  doing  evil,  but  it  is 
paternalism  to  reward  him  for  doing  good.  It  seems  to  be  not  so 
much  "coercive  laws"  in  general  that  our  insurance  experts  are 
against  as  coercive  laws  that  do  not  make  criminals. 

We  must  have  legislation  in  one  way  or  another  if  we  get  anywhere 
in  a  health  program,  and  the  only  question  is  what  kind  of  legislation 
it  shall  be.  If  we  go  after  repressive  legislation  which  increases 
criminality,  we  run  great  risks  of  breaking  down  our  health  depart- 
ments through  practical  politics  in  the  hopeless  task  of  detecting  and 
prosecuting  criminals  ;  but  if  we  go  after  cooperative  legislation 
that  offers  the  inducement  of  profit  to  business  men  if  they  will 
take  a  hand  themselves  in  preventing  sickness,  we  shall  strengthen 
the  demand  for  efficient  health  departments  free  from  politics. 
Instead  of  starting  a  public-health  program  in  defiance  of  business 
instincts,  we  start  it  by  building  up  a  business  demand  for  it. 

That  America  stands  in  need  of  such  a  program  we  realize  now  as 
never  before.  We  have  had  our  first  national  survey  of  the  people's 
health.  For  the  first  time  the  medical  profession  has  been  organ- 
ized on  a  national  scale  for  the  detection  of  disease.  Thousands  of 
our  young  men,  at  the  prime  of  life,  when  the  nation  needed  them, 
have  been  rejected  and  returned  to  their  homes.  Every  local  com- 
munity in  the  nation  has  been  wakened  up  to  the  previously  un- 
discovered tuberculosis  and  physical  and  mental  defects  in  its  midst. 
Even  our  most  efficient  health  departments  did  not  know  anything 
about  three  fourths  or  even  nine  tenths  of  the  tuberculosis  in  their 


HEALTH  PROGRAM 


87 


jurisdiction.  We  know  now,  as  never  before,  how  much  it  means 
to  the  nation  to  start  at  the  very  beginning,  before  people  suspect 
that  anything  is  wrong  with  themselves.  We  know  that  if  thousands 
were  rejected  at  the  draft,  there  must  be  additional  thousands  and 
hundreds  of  thousands  defective  in  like  manner.  The  draft  reached 
10,000,000.    But  there  are  100,000,000  of  us. 

And  there  we  leave  it.  These  boys  of  ours  return  to  their  homes, 
and  nothing  is  done  about  it.  These  hundreds  of  thousands  need  a 
similar  medical  examination,  and  there  are  no  doctors  to  examine 
them.  They  are  no  longer  immediately  needed  to  defend  the  nation 
in  war,  but  they  are  needed  in  agriculture,  manufactures,  mining,  and 
every  business  and  profession  where  they  can  help  to  make  the 
nation  prosperous  and  happy  in  time  of  peace.  Health  is  our  first 
and  greatest  asset ;  sickness  and  poor  physique  our  greatest  liability. 
We  have  abundant  natural  resources.  We  have  a  stimulating,  even 
overstimulating,  climate.  We  have  a  more  intense  competitive  busi- 
ness and  industry  than  any  other  nation.  We  need  stronger  men 
and  women  to  keep  up  the  pace  than  any  other  nation.  Our  wealth 
is  not  in  our  resources  and  climate,  but  in  our  oncoming  men  and 
women.  The  doctor  is  our  greatest  producer  of  wealth.  The  rest  of 
us  can  do  nothing  if  the  doctor  falls  down.  Schools  and  education 
are  fruitless  without  health.  Industry  carries  an  unseen  but  costly  ex- 
pense of  inefficiency  and  absenteeism  on  account  of  ill  health  and  poor 
physique.  We,  as  a  nation,  have  begun  to  see  the  futility  of  education 
and  industry  if  we  do  not  have  health  and  physique  to  build  upon. 

Shall  the  doctor  rise  to  this  demand  and  do  his  part  ?  He  may 
cling  to  the  old  idea  that  his  is  the  art  of  curing  people  of  sickness  and 
driving  out  the  evil  that  previously  got  into  them.  That  is  im- 
portant enough,  we  do  not  need  to  be  told.  But  will  he  really  also  get 
a  living  sense  of  what  he  might  do  and  how  he  must  do  it  if  he  would 
make  the  modern  scientific  preventive  medicine  available  for  every- 
body? He  can  try  to  bail  out  the  river  as  it  flows  through  the 
country,  but  can  he  go  back  to  the  100,000,000  unseen  sources  of 
the  river  of  sickness  ? 

I  do  not  see  that  the  profession  as  a  whole  is  in  the  frame  of  mind 
to  do  it.  They  will  agree  with  you  that  it  ought  to  be  done,  and, 
more  than  any  other  profession  or  business,  the  medical  profession 
has  a  high  sense  of  public  responsibility.    Other  professions  look 


i 

i 


ss 


TRADE  UNIONISM  AND  LABOR  PROBLEMS 


i   I 


M 


complacently  on  an  increase  in  the  public  demand  for  their  services. 
Lawyers,  on  the  whole,  are  not  eager  to  cut  down  the  amount  of 
litigation  and  legal  business  in  the  country.  Doctors,  on  the  other 
hand,  support  all  measures  tending  to  improve  the  public  health 
and  cut  down  the  demand  for  doctors. 

But,  on  the  whole,  they  seem  to  think  that  the  actual  work  of  im- 
proving the  public  health  belongs  to  the  public-health  departments 
and  not  to  the  practicing  physicians.  For  that  actual  work  re- 
quires much  more  cooperation  on  their  part  with  the  health  depart- 
ments than  they  seem  to  be  willing  to  undertake.  They  are  glad 
to  educate  the  public,  and  to  warn  the  public,  and  to  approve  public- 
health  resolutions,  but  to  organize  themselves  as  a  profession  and  to 
do  what  is  necessary  in  order  to  examine  100,000,000  people  and 
then  keep  them  continuously  in  good  health  does  not  seem  to  appeal 
to  them. 

Only  in  one  branch  of  the  medical  profession  does  there  seem  to 
be  a  truly  live  appreciation  of  what  an  outsider  would  think  is  pre- 
eminently needed.  In  that  remarkable  Framingham  demonstration 
the  tuberculosis  specialists  have  started  out  to  examine  and  follow  up 
an  entire  community  in  advance  of  individual  complaints.  They  do 
it  through  the  cooperation  of  the  practicing  physicians,  and  in  order 
to  accomplish  this  they  work  through  the  organized  medical  society 
and  through  the  public-health  department  of  the  city.  It  means 
the  organization  of  the  community  itself,  the  organization  of  the 
nurses,  and  the  daily  cooperation  of  the  people,  the  doctors,  the 
nurses,  the  specialists,  and  the  public-health  department  in  a  great 
systematic  program  of  early  detection  and  sickness  prevention. 

This  Framingham  demonstration  seems  to  me  a  far  more  impres- 
sive lesson  than  any  campaign  ever  undertaken  by  the  Tuberculosis 
Association  for  the  construction  of  sanatoria  and  the  cure  of  ad- 
vanced cases.  It  was  natural  that  the  early  tendency  of  tuberculosis 
specialists,  like  other  specialists,  was  directed  towards  hospitals, 
sanatoria,  and  treatment  of  advanced  cases.  What  is  wanted  now  is 
a  Framingham  demonstration  in  every  state  of  the  Union— not  fewer 
sanatoria  but  more  clinics.  The  people  of  this  country  need  to 
learn  how  to  go  about  it  in  order  to  cooperate  with  the  doctors. 
We  never  shall  learn  unless  the  physicians  show  us.  We  know 
what  we  want,  but  we  do  not  know  how  to  do  it.   A  Framingham 


HEALTH  PROGRAM 


89 


demonstration  in  every  state  would  show  us  how,  and  would  waken 
up  the  entire  medical  profession  to  the  methods  and  possibilities  of 
sickness  prevention. 

Almost  more  than  any  other  human  ailment  is  tuberculosis  a  prob- 
lem of  early  examination  and  prevention.  If  nearly  all  of  us  have 
been  carrying  around  the  germ  in  little  self-made  pockets  without 
knowing  it,  what  we  want  is  not  merely  to  keep  away  from  the  germ 
but  also  to  have  somebody  find  out  for  us  as  soon  as  possible 
whether  the  pockets  are  holding  out  and  to  tell  us  what  to  do  to  keep 
them  from  breaking  loose.  Evidently  in  this  search  for  tuberculosis 
almost  every  other  unseen  human  ailment  can  be  uncovered.  There 
are  other  lurking  germs,  and,  most  of  all,  there  is  the  everyday  life 
in  the  home,  in  the  factory  and  shop,  there  is  the  fatigue,  the  strain, 
the  food,  the  shelter,  that  determine  whether  or  not  the  body  is  re- 
sisting and  overcoming  its  subtle  enemies.  That  which  is  done  to 
discover  and  head  off  tuberculosis  may  well  discover  and  head  off 
many  of  the  other  ailments  and  poor  physique.  The  tuberculosis 
specialist  is  the  least  specialized  of  all  medical  specialists,  for  he 
must  take  into  account  all  of  the  social  and  industrial  conditions  as 
well  as  the  individual  conditions  that  predispose  to  disease.  In  doing 
so  he  must  have  the  cooperation  of  the  entire  profession,  of  the  entire 
community,  and  of  the  health  departments. 

The  great  question  in  a  health  program  is  how  to  get  this  coopera- 
tion universally.  What  it  amounts  to  is  practically  a  revised  view 
of  the  ethics  of  the  medical  profession.  It  seems  that,  in  our  great 
cities  at  least,  those  who  get  the  best  medical  attention  are  the  very 
rich  and  the  very  poor.  For  these  extreme  classes  medical  advice 
and  care  are  practically  free.  The  very  rich  do  not  mind  the  expense, 
and  the  very  poor  are  not  ashamed  if  somebody  else  pays  their  bills. 
But  the  extreme  rich  and  poor  are  scarcely  5  or  10  per  cent  of  the 
total  population.  The  idea  of  extending  free  medicine  to  the  other 
90  per  cent  of  the  population  seems  revolting  to  many  physicians. 

At  the  University  of  Wisconsin  we  have  free  medical  supervision 
for  5000  students.  The  state  is  taxed  for  health  supervision  of  the 
students  exactly  as  it  is  taxed  for  their  education.  As  a  result,  the 
students  consult  the  physicians  on  an  average  probably  four  or  five 
times  as  often  during  the  year  as  they  would  if  they  had  to  pay  at 
each  consultation,  besides  getting  the  thorough  physical  examination 


90         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

at  the  beginning  of  the  year.  The  result  has  been  a  great  reduction 
in  sickness,  a  reduction  in  absenteeism  from  classes,  and  greatly 
increased  student  efficiency.  The  loss  of  time  due  to  bed  illness 
has  been  reduced  40  to  60  per  cent,  due  to  the  early  treatment  of 
preventable  conditions.  The  frequent  consultations  have  reduced 
serious  illness  and  its  complications  at  least  50  per  cent.  During  the 
eight  years  of  this  medical  supervision  the  University  death  rate 
has  been  reduced  to  only  one  fourth  of  the  general  expectant  rate, 
exclusive  of  tuberculosis,  at  the  same  age  period,  and  even  the 
death  rate  from  the  recent  "flu"  epidemic  was  believed  to  be  only 
one  fourth  of  the  general  death  rate  attributable  to  that  cause. 

Why  should  not  something  like  this  arrangement  be  extended  to 
the  entire  population  of  the  state  and  the  nation  ?  It  does  for  5000 
of  the  great  middle  class  by  taxation  what  the  very  rich  and  the  very 
poor  have  been  getting  in  the  great  cities  substantially  free  of  cost 
to  themselves. 

The  principal  reason  against  extending  it  to  the  nation  seems  to  be 
the  opposition  of  doctors.  The  idea  that  people  generally  should 
consult  them  without  paying  for  each  consultation  seems  unusual  to 
them.  Consequently  we  have  that  ethics  of  the  profession  which 
permits  heavy  fees  charged  to  wealthy  patients  in  order  to  make  up 
for  the  free  service  given  to  indigent  patients.  Even  if  there  are  no 
wealthy  patients  in  the  neighborhood,  the  doctor  expects  to  render 
a  considerable  amount  of  service  free  of  charge,  or,  what  is  the  same 
thing,  to  carry  a  large  account  of  uncollectable  bills,  and  these 
charges  must  be  met  by  correspondingly  higher  fees  charged  to  the 
people  who  do  pay  their  bills.  It  amounts  to  a  tax  on  the  wealthy 
and  on  the  great  middle  class  in  order  to  give  free  service  to  a  pauper- 
ized class  or  a  class  that  is  not  ashamed  to  dodge  its  doctor's  bills. 

As  a  result,  this  great  middle  class  of  farmers,  wage-earners,  and 
people  with  moderate  incomes,  who  will  not  accept  free  service,  do 
not  consult  the  doctors  and  pay  the  fees  until  they  are  compelled  by 
sickness.  They  hold  off,  and  doctor  themselves,  and  buy  patent 
medicines,  until  it  is  too  late.  If  consultations  were  free,  they  doubt- 
less would  consult  the  doctors,  as  our  students  do,  many  times  as 
often  as  they  now  do. 

This  is  what  I  call  prevention  of  sickness,  and  this  is  what  health 
insurance  means.    It  means  free  consultations,  and  it  means  payment 


HEALTH  PROGRAM 


91 


of  the  doctors,  to  that  extent,  out  of  a  fund  contributed  in  advance 
by  the  people  and  by  the  industries  of  the  country.  It  means  free 
consultations  and  free  examinations  and  diagnoses  supported  by  taxa- 
tion through  the  medium  of  insurance  funds.  It  means,  instead  of 
the  physician's  being  compelled  to  constitute  himself  a  tax  assessor 
and  tax  collector  on  the  wealthy  and  the  middle  class  in  order  to 
furnish  the  poor  with  free  service  after  they  are  sick,  that  the  legis- 
lature shall  create  its  own  system  of  taxation  in  order  that  the  doctor 
may  freely  serve  all  persons  long  before  they  get  sick. 

One  of  the  principal  obstacles,  as  I  have  just  said,  to  the  method 
of  starting  a  health  program  by  means  of  universal  health  insurance 
is  the  attitude  of  many  doctors.  Doctors  have  several  reasons  for 
suspicion.  They  know  something  about  the  contract  doctors.  They 
see  mutual  benefit  societies  let  out  contracts  to  the  lowest  bidder  to 
take  care  of  their  members  in  sickness.  But  these  mutual-benefit 
societies  have  the  old  idea  of  insurance  as  a  philanthropic  measure 
of  relief,  not  the  new  idea  of  insurance  as  a  means  of  preventing 
sickness.  They  look  on  sickness  as  inevitable  and  the  doctor  as  a 
palliative.  They  get  this  idea  largely  from  the  doctors  themselves. 
They  have  not  yet  fully  learned  from  their  doctors  of  the  enormous 
advance  that  the  past  thirty  years  has  made  possible  in  preventive 
medicine.  Neither  have  these  mutual  societies  the  business  ability 
nor  business  inducement  to  prevent  sickness  that  the  employer  has. 
Their  purpose  is  charity,  not  business.  These  mutual  societies  will 
always  have  a  most  important  part  in  a  universal  health  program. 
They  do  one  thing  that  neither  the  doctor  nor  the  employer  can  do. 
The  very  fact  that  they  let  out  contracts  to  the  lowest  bidders  indi- 
cates that  they  try  to  keep  down  expenses.  They  assess  themselves, 
and  if  expenses  go  up  their  assessments  go  up.  For  this  reason  they 
are  careful  to  watch  their  members  and  to  prevent  them  from  feigning 
sickness  and  getting  the  benefits  fraudulently.  In  this  respect  they 
can  do  what  neither  employers  nor  doctors  can  do  without  their  help, 
and  this  is  a  reason  why  health-insurance  programs  propose  greatly 
to  enlarge  the  field  of  these  mutual  societies,  and  to  require  their 
members,  as  well  as  the  employers,  to  contribute  to  the  insurance 
funds.  But  their  field  is  largely  the  care  of  unprevented  sickness. 
Not  until  the  business  ability  of  the  community  is  directed  towards 
prevention  can  we  expect  that  the  enormous  advances  in  medical 


4!. 


92         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

science  of  the  past  thirty  years  will  be  generally  utilized.  Then 
the  doctor  who  bids  on  contracts  will  disappear,  much  as  the  old- 
time  factory  inspector  is  giving  way  to  the  safety  expert. 

The  other  important  obstacle  to  health  insurance  is  the  idea,  not 
only  of  insurance  experts  but  also  of  the  public  and  of  physicians 
and  surgeons,  that  the  work  of  the  practicing  physician  is  the  art  of 
healing  the  sick  rather  than  the  art  of  preventing  their  sickness. 
Those  who  are  interested  in  the  problem  of  tuberculosis  are  the 
pioneers  in  revising  this  mistaken  view,  for  they  realize,  as  others 
do  not,  how  little  can  be  accomplished  without  the  complete  organi- 
zation of  the  profession  and  of  the  community  for  the  purpose  of 
discovery  and  prevention.  It  is  fortunate  that  they  have  had  their 
own  association  and  their  own  funds,  independent  of  the  profession  in 
general,  for  it  is  this  that  enables  them  to  go  ahead  in  their  educa- 
tional campaign  of  organization,  legislation,  and  prevention,  without 
waiting  for  others. 

The  work  of  the  Tuberculosis  Association  reveals  that  palliatives 
and  halfway  measures  are  inadequate.  It  reveals  to  us,  most  of  all, 
the  need  of  a  medical  profession  that  shall  be  in  truth  the  guardian 

of  the  public  health  as  well  as  practitioners  of  the  healing  art 

a  profession  so  organized  that  the  wonderful  developments  of  medical 
science  shall  reach  every  person,  for  the  public  health  is  nothing  but 
the  protection  of  each  individuaPs  health. 

It  reveals  to  us  the  need  of  placing  this  profession  on  a  business 
basis  instead  of  leaving  its  practitioners  to  the  doubtful  expedient 
of  financing  their  calls  for  charity  by  taxing  it  up  to  the  more  well- 
to-do. 

The  work  of  the  Tuberculosis  Association  reveals  the  need  of  en- 
listing the  business  ability  of  the  nation  in  the  campaign  of  preven- 
tion. Industry  already  pays  an  unseen  tax  in  the  absenteeism  and 
inefficiency  caused  by  sickness  and  poor  physique.  But  not  until 
this  tax  is  made  visible  in  terms  of  money,  where  it  can  be  actually 
seen  entering  into  the  cost  of  manufacture,  will  business  men  gen- 
erally look  to  the  medical  profession  for  assistance  in  reducing  it. 
WTien  the  vigilance  of  business  men  is  enlisted  in  the  cause,  then 
will  the  high  aims  of  the  new  medical  profession,  which  seeks  to 
keep  the  nation  healthy  as  well  as  cure  its  sickness,  be  more  nearly 
realized.    Medicine  will  more  nearly  become  public  medicine,  but 


HEALTH  PROGRAM 


93 


liberated  from  politics.  Health  departments,  in  every  town  and  rural 
district,  instead  of  trying  to  do  the  work  of  prevention  themselves 
unaided,  will  be  the  public  agencies  which  furnish  to  the  private 
practitioners  the  dispensaries,  clinics,  hospitals,  sanatoria,  school  and 
county  nurses,  which  make  it  financially  possible  for  the  private 
practitioners  to  add  the  work  of  prevention  to  their  work  of  healing. 
A  truly  comprehensive  health  program  is  not  restricted  to  any  one 
thing.  It  means,  of  course,  the  cure  of  sickness.  But  it  means,  also, 
the  personal  cooperation  of  every  private  citizen  in  sickness  preven- 
tion. It  means  the  business  enterprise  of  every  capitalist  and  em- 
ployer of  labor.  It  means  sickness  insurance.  It  means  increased 
taxation  on  uriprevented  sickness,  with  ultimately  reduced  taxation 
on  property.  It  means,  most  of  all,  a  medical  profession  able  and 
willing  to  bring  to  the  service  of  the  entire  nation  the  marvelous 
discoveries  of  the  science  of  preventive  medicine. 


John  R.  Commons 


University  of  Wisconsin 


FLOATING  LABORERS 


9S 


\\ 


\ 


\      " 


M 

■.:f , 
"•MLkt  IB' 

ill 


PART  11.    THE  LABOR  MARKET 


VII 

AUTOBIOGRAPHIES  OF  FLOATING  LABORERS^ 

NUMBER  2.  Age  fifty-six  years,  born  in  America,  of  American 
parents.  Single.  Still  strong.  When  he  was  between  twenty  and 
twenty-five  years  of  age  he  wanted  to  marry,  but  never  had  enough 
money  to  establish  a  home.  He  became  a  "regular"  lumberjack.  A 
"regular"  lumberjack  cannot  marry,  for  he  cannot  take  his  wife  to 
the  camp,  and  it  is  of  no  use  for  her  to  live  in  the  city.  Secondly, 
if  a  man  becomes  a  "regular"  lumberjack,  he  is  not  fit  for  married 
life;  he  drinks,  fights,  and  leads  an  immoral  life.  He  does  not 
know  any  trade.  While  a  boy  he  wanted  to  learn  mechanics,  to 
become  a  worker  in  a  machine  shop,  but  he  had  no  chance  for  this, 
for  his  folks  were  poor  and  he  did  not  have  a  sense  of  how  to  go 
about  learning  this  desired  trade ;  his  father  was  not  very  bright 
either — he  could  not  read  and  write.  He  himself  had  been  in  a 
public  school  for  his  education. 

His  father  was  a  farmer,  and  he  started  to  work  on  his  father's 
farm  when  ten  years  of  age,  to  do  chores  and  every  kind  of  farming 
work.  His  mother  died  when  he  was  very  young.  As  the  farm  was 
heavily  mortgaged,  it  was  sold ;  not  much  money  was  left. 

When  he  was  sixteen  years  of  age  he  went  into  the  lumber  woods 
to  provide  for  himself.  He  worked  from  fourteen  to  fifteen  hours 
a  day.  The  pay  was,  at  the  beginning,  $i8  a  month  and  board. 
Laundry  was  done  by  the  men  themselves.  Two  men  slept  in  a 
bunk;  the  bunks  were  in  two  stories.  The  bedding  was  hemlock 
brush,  covered  with  a  blanket.  In  the  bunk  house  there  was  no 
iron  stove,  but  just  a  fireplace  called  "kabuke."  The  foreman  was 
a  bad  man,  always  hollering,  abusing,  ever  dissatisfied  with  his  men, 
and  turning  them  out  two  hours  before  "they  could  see  wolves." 

iFrom  interviews  made  for  the  U.S.  Industrial  Relations  Commission,  1914. 

94 


The  plates  and  table  utensils  were  made  of  wood  by  the  men  them- 
selves. The  board  was  very  poor;  it  consisted  mostly  of  salt 
pork  and  salt  beef.  There  was  no  ventilation  in  the  bunk  houses. 
There  was  no  wooden  floor,  just  the  naked  earth.  Nobody  washed 
the  blankets ;  they  were  dirty  and  had  vermin. 

He  managed  to  work  on  this  place  eight  years,  in  winter  and  in 
summer.  The  company  then  moved  to  another  place,  where  he 
worked  a  year  more  with  the  same  company.  He  then  wanted  to  try 
other  companies,  believing  that  they  might  be  better,  but  the  con- 
ditions were  almost  the  same,  perhaps  a  little  better.  He  worked 
here  and  there  one  year.  He  quit  because  other  fellows  told  him  of 
a  place  where  the  conditions  were  much  better.  He  tried  that  place, 
but  the  conditions  were  just  the  same.  He  then  migrated  to  the  state 
of  Wisconsin,  and  worked  there  in  various  lumber  camps  two  years, 
but  the  labor  conditions  in  the  lumber  camps  in  Wisconsin  were  worse 
than  in  Michigan.  He  wanted  to  see  the  camps  in  Minnesota,  and 
migrated  there.  He  worked  there  five  years  with  two  companies. 
In  the  camp  of  one  the  labor  conditions  were  a  little  better  than  in 
the  lumber  camps  of  Wisconsin,  but  in  the  camp  of  the  other  the 
conditions  were  still  worse. 

He  then  wanted  to  see  his  folks,  father  and  sister,  and  came  back 
to  Michigan,  having  about  S60.  After  a  week  with  his  folks  he  went 
to  work  for  a  lumber  jobber,  thirteen  to  fourteen  hours  a  day,  S3  5 
a  month  and  board.  He  paid  for  the  washing  of  his  laundry  80  cents 
a  month.  Two  men  slept  in  one  bunk ;  the  bunks  were  in  two  and 
three  stories.  The  bedding  consisted  of  sacks  filled  with  hay  and 
straw,  and  blankets,  which  were  never  washed  and  were  full  of 
vermin.  The  bunk  house  was  overcrowded.  The  air  in  the  night  was 
very  bad ;  he  felt  dizzy  and  had  a  bad  taste  in  his  mouth  in  the 
morning.  There  were  no  spittoons,  no  privy  vaults ;  the  men  were 
often  sick,  catching  cold  and  grippe.  The  drinking  water  was  bad, 
just  surface  or  swamp  water.  He  felt  quite  tired  in  the  evening. 
He  worked  at  this  place  about  five  months.  He  had  only  from  $12 
to  $15  left.  He  then  went  to  work  with  a  company,  from  eleven  to 
twelve  hours  a  day,  the  pay  being  $35  a  month  and  board.  His 
work  consisted  in  driving  oxen.  Two  men  slept  in  one  bunk ;  the 
bunks  were  in  two  stories;  the  floor  was  dirty;  the  bedding  con- 
sisted of  loose  straw  covered  with  a  blanket.    The  drinking  was  good 


?i3 


96         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

—spring  water.  The  foreman  was  a  good  man.  The  goods  in  the 
commissary  store  were  the  same  as  elsewhere,  but  the  price  was  from 
15  to  50  per  cent  higher  than  in  the  stores  in  town. 

A  year  ago  he  worked  in  the  lumber  camp  of &  Co.  from 

eleven  and  one-half  to  twelve  hours  a  day.  The  pay  was  $32  a 
month  and  board.  Two  men  slept  in  one  bunk;  the  bunks  were  in 
three  stories.  The  bunk  house  was  overcrowded;  about  125  to  140 
men  slept  in  the  same  bunk  house.  The  floor  was  dirty  ;  it  was  diffi- 
cult to  get  through  the  mud.  The  bedding  consisted  of  straw  and  hay 
on  boards;  there  were  '^bedbugs  and  lice";  although  washed,  the 
bedding  could  not  be  kept  clean,  because  dirty  men  were  going  and 
coming.  The  board  was  very  good,  and  the  water  was  good,  but  the 
foreman  was  always  speeding  up  and  swearing  with  every  word  he 
said.  Could  not  stand  this  job  any  longer  than  two  and  one-half 
days.    From  that  place  he  came  to  the  present  camp. 

They  work  here  eleven  hours  a  day,  and  his  pay  is  S3  2  a  month 
and  board.  His  work  consists  of  driving  oxen.  He  can  work  con- 
tinuously only  two  or  three  weeks ;  then  he  gets  his  pay,  goes  to  the 

town  of  P ,  drinks,  fights,  "just  having  a  good  time."    Lately  he 

has  been  working  four  weeks,  and  feels  a  need  of  "rest."  He  has 
not  been  out  of  work  because  he  could  not  secure  it;  he  can  se- 
cure work  any  time.  He  has  never  stolen  anything,  never  begged 
nor  applied  for  charity ;  but  what  he  has  done  is  heavy  drinking 
(whisky),  prostitution,  and  fighting.  He  has  a  gash  on  his  face,  and 
half  of  his  nose  was  bitten  off  in  a  saloon  fight  many  years  ago. 
He  has  had  three  accidents  in  the  lumber  work :  first,  he  had  his 
hand  broken;  second,  his  leg  was  broken;  and  the  third  time  his 
left  shoulder  was  hurt.  These  accidents  occurred  by  skidding.  He 
is  a  "regular"  lumberjack,  because  he  makes  his  living  by  working 
in  the  lumber  industry,  drinks,  fights,  and  lives  in  the  way  in  which 
a  lumberjack  does. 

He  thinks  that  the  worst  evil  in  the  lumber  camps  is  the  bunk 
houses.  They  ought  to  be  built  similar  to  hotels.  Every  man  ought 
to  have  his  own  small  room,  and  the  board  should  be  provided  as  in 
city  boarding  houses.  This  would  not  cost  much  more  for  the  com- 
pany than  a  camp  costs  now.  The  company  gives  enough  to  eat  and 
the  meals  are  prepared  properly,  but  they  serve  the  same  meals  day 
in  and  day  out,  week  in  and  week  out,  at  all  times.   After  a  time  a 


FLOATING  LABORERS 


97 


man  becomes  tired,  from  the  sameness  of  the  meals.  The  camps 
are  nowadays  more  or  less  permanent,  because  the  railroad  is 
bringing  logs  in  and  carrying  the  men  to  working  places  at  great 
distances. 

To  the  question  as  to  what  the  government  must  do  in  order  to 
better  the  conditions  of  the  life  of  lumberjacks,  he  answered :  "  Close 
all  saloons,  and  wipe  out  all  the  prostitute  houses ;  if  this  were  done, 
the  lumberjacks  would  take  pretty  good  care  of  themselves  as  to 
bettering  the  labor  conditions  in  the  camps." 

Jungle,  Red  fern,  South  Dakota 

Number  3.  Age  twenty-four  years,  Dane.  Seven  years  in  this 
country.  Came  to  America  because  it  is  the  best  country  in  the 
world.    The  best  opportunities  to  better  himself. 

Latin  (high-school)  education.  Started  out  as  a  sailor.  Learned 
steam  engineering.  Quit  it  because  of  the  hardships  and  monotony 
in  the  life  of  a  sailor.  Pay  was  from  $15  to  S20  a  month.  Worked 
in  various  industries  in  America.  Had  a  job  in  the  shipyard  at 
Philadelphia,  $2  a  day,  ten  hours;  treatment  first  class.  Quit. 
Started  to  go  sailing  on  the  Great  Lakes — higher  wages,  more  op- 
portunity of  saving  money.  Could  not  get  job  because  of  the  sailors' 
union;  entrance  fees  S25  ;  he  had  not  the  money.  A  job  in  factory 
— one  day  ;  conditions  bad.  Secured  a  job  in  a  rubber  works  ;  $1.50, 
afterwards  $1.75  ;  ten  hours  a  day.  Laid  off  because  of  the  business 
depression.  Went  out  to  a  farm  to  pick  potatoes  at  $1  a  day,  ten 
hours;  the  board  was  good.  Returned  to  the  East.  No  work  for 
four  or  five  months.  Got  money  from  home,  about  $200 — money 
he  had  saved.  Went  back  to  Buffalo ;  paid  his  way.  Was  told  that 
a  steel  plant  was  to  be  opened  there.  Did  not  get  work  there — 
because  nearly  all  men  taken  were  south  European  immigrants. 
Wanted  to  enter  the  union.  The  union  did  not  let  him  in,  because 
too  many  old  members  were  around  out  of  work.  The  Lake  Car- 
riers' Association  declared  open  shop.  Got  a  job  from  this  Asso- 
ciation. It  was  necessary  to  sign  a  statement  declaring  loyalty  to 
Association  or  to  union.  He  signed  the  union  oath,  after  which  he 
was  fired.  Started  for  the  West.  Believed  that  the  West  was 
better.  Went  broke  in  Chicago.  Went  into  restaurant  asking  for 
dish-washing.    Did  not  get  work,  but  got  meals.    Went  to  Santa  Fe. 


Ill 


h 
I 

-4 


'I 


II. 
'fill' 


98         TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Beat  his  way  down  to  Missouri.   Went  over  the  country  roads  not 
very  far  from  Kansas  City.    Avoided  the  city  because  of  the  fear  of 
getting  arrested  for  vagrancy.    Asked  farmers  for  job.    Begged.  Got 
one  job  at  50  cents  a  day  for  five  days,  when  the  job  was  done.   After 
buying  some  clothing,  25  cents  left.    Bought  a  loaf  of  bread,  ice 
cream— all  money  gone.   Went  into  Nebraska — westward.    Several 
days  without  eating,  except  apples.    Got  a  job  with  a  German  farmer, 
haymaking,  $1.50  a  day,  ten  to  eleven  hours.    Good  board,  slept  in 
the  barn.   Treatment  was  fine.    Six  days,  the  job  was  done.    Partner 
got  hurt  very  badly,  trying  to  get  a  freight  train,  and  was  sent  home 
East.    Continued  his  way  toward  West.    Freighted.    Got  a  job  on 
a  farm  in  Nebraska,  $18  a  month.    Chores  and  general  farm  work, 
ten  hours.    Board  good.    Got  hurt  after  three  months.    Right  foot 
was  hurt  by  mowing  machine.    Two  weeks  ill.    Doctor's  bill,  $15. 
Paid  it  himself.   Was  young,  no  company  for  him,  the  life  was  too 
monotonous  on  the  farm.   Working  all  the  time  in  the  fields,  wages 
low,  hours  long.    Quit,  although  the  farmer  promised  $30  a  month ; 
he  could  buy  calves  and  pasture  them,  free  of  charge,  and  market 
them  for  his  own  benefit.    Perhaps  this  was  a  little  opportunity  for 
him,  but  for  the  reasons  stated  he  left.    Went  to  Denver — westward. 
Two  weeks.   Looked  for  jobs  through  private  employment  agencies. 
Paid  for  fees  Si. 50.   Was  shipped  to  Moffat  Road;  in  railway  con- 
struction camp ;  $2  a  day,  or  20  cents  an  hour,  ten  hours ;  two  days. 
Quit.    Got  work  in  a  coal  mine.   Outside  night  work  ;  $2.25,  nine 
hours.    Mine  camp,  four  or  six  men  slept  in  each  room,  two  in  a 
bed;    dirty  mattress,  dirty   blankets.   Lousy.   No   ventilation,   no 
spittoons.    No   sanitary   rules ;    no  garbage   collections.    No   toilet. 
One  week.  Left  because  of  snowstorm.  Went  westward,  beat  his  way 
to  Salt  Lake  City.    Broke.    Two  days  in  Salt  Lake  City.    Asked  a 
fellow  in  the  street  where  a  man  without  money  could  get  a  bed. 
Slept  in  a  saloon.    Begged.    Sold  his  razor.   Was  shipped  out  with 
800  men  to  the  Western  Pacific  construction  camp  in  Nevada.    On 
the  road  two  days  and  two  nights  without  meals.    Some  fellows 
ate  raw  potatoes  picked  up.    W^ere  taken  to  the  end  of  the  new  track. 
Box  cars,  some  with  provisions.    The  men  stormed  the  cars  with 
provisions  and  took  cheese,  bread,  and  a  few  canned  stuffs.   He  got 
several  cans.    Hiked  twenty  miles  into  the  desert.   Wanted  to  go  to 
the  Southern  Pacific.    Took  a  train  down  the  line.    Got  a  job  on  a 


ii 


FLOATING  LABORERS 


99 


construction  camp  on  Western  Pacific,  $1.75  a  day,  ten  hours.  The 
board  was  poor.  It  was  a  slave-driving  job ;  lousy  bunks  in  tents ; 
twelve  days ;  quit.  Went  south  into  another  camp,  conditions  were 
slightly  better,  $2  a  day,  better  work.  Quit.  Got  sick  from  cold. 
No  medical  aid.  Went  to  California,  to  San  Francisco  ;  59  cents  in 
pocket;  three  weeks.  Was  on  Barbary  Coast.  Hung  around  the 
red-light  district.  Down-and-outs  hang  around  there,  for  the  "sports" 
(rich  people)  come  there,  spend  money  lavishly.  He  did  begging, 
Entered  a  mission  called  "Whosoever  Will."  He  wanted  to  have  a 
Christmas  breakfast,  promised  by  the  mission.  About  2000  people 
had  gathered,  the  street  was  full ;  a  riot  almost  occurred.  The  hungry 
people  were  waiting  for  that  breakfast  the  whole  night.  He  got  in- 
side. Got  for  breakfast  rotten  fish,  could  not  eat  it ;  two  slices  bread 
and  coffee— bread  was  all  right.  The  mission  wanted  the  men  to 
come  for  dinner,  for  parading  through  the  streets.  He  refused,  his 
self-respect  was  against  it.  (The  men  conducting  the  "Holy  Mis- 
sion" had  made  $300,000  out  of  these  poor  people  through  their 
work,  donations,  and  any  kind  of  manipulation.  The  mission  crooks 
were  afterwards  arrested. ) 

He  left  for  the  South  to  pick  oranges ;  put  to  work  by  police  on 
street  cleaning  in  a  small  town.  Worked  a  day,  then  told  to  get  out 
of  town.  No  trial.  Went  to  Los  Angeles.  A  job  for  the  city,  pick 
and  shovel,  $2.25  a  day,  eight  hours.  Worked  five  months.  Quit- 
too  hot.  Went  sailing.  One  year  sailing.  Got  sick.  Thought  he 
had  consumption,  but  had  only  cold.  Went  to  Portland,  Oregon. 
Went  to  work  in  Columbia  Digger  Company,  S50  a  month.  Board 
and  room  were  good.  Worked  eight  months  as  second  engineer. 
No  more  work.   Laid  off  in  the  winter  time.     $125  saved.   Went  to 

Los  Angeles. 

Joined  I.  W.  W.  in  Portland.  In  Los  Angeles  was  elected  secretary 
of  this  organization,  but  did  not  get  any  pay. 

Took  part  in  the  Madero  Revolution  in  Mexico.  Three  months  on 
the  battle  ground.  The  command  had  about  200  men;  about  half 
were  Americans.  It  had  control  over  several  towns.  He  did  shoot- 
ing. He  is  sure  he  killed  one  Federal.  Was  elected  financial  secre- 
tary of  a  town.  No  pay.  Was  handed  about  Si 900.  Bought 
ammunition.  Had  machine  guns  made  in  Los  Angeles.  Their  com- 
mand got  defeated  by  Federals  who  had  1500  men.   The  command 


■J 


1    * 


100      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

in  which  he  was  fighting  lost  three  or  four  men.  Retreated  to  the 
United  States,  surrendered  to  the  United  States  troops.  He  beat  his 
way  across  the  line.  Went  to  Los  Angeles.  Was  hidden  there  for  a 
time.  Went  to  San  Pedro.  Got  a  steam  schooner.  Went  to  San 
Francisco.  Then  to  Portland.  Had  little  money,  about  $io.  Could 
steal  in  Mexico — big  money,  but  did  not,  the  money  belonged  to 
his  fellow  workers.  Went  to  work  right  away  in  Portland  for  the 
same  company  as  before.  Conditions  the  same.  Worked  there  six 
months.  Job  done  in  winter;  $150  saved.  All  winter  there  in  Port- 
land. Got  a  job  of  dish-washing,  $8  a  week  and  meals,  twelve  hours, 
two  weeks.  Quit — too  long  hours,  not  enough  money ;  out  of  work 
two  months.  'Got  a  secret  disease. 

In  19 13  went  to  a  lumber  camp  near  Seattle,  Washington,  to  drive 
donkeys,  $3.25.  Board  good.  Slept  in  bunks.  One-man  bunks  in 
two-layer  tiers.  Bedding  straw,  own  blankets,  vermin.  No  laundry, 
washing,  bathing,  toilet  facilities  ;  no  screens,  no  sanitary  rules. 
Worked  eleven  hours  ;  had  one  and  one-half  miles  to  hike  out  to  the 
work-place  each  day.  Got  up  about  five  o'clock;  stopped  at  five 
forty-five  at  night.  Worked  two  weeks.  Quit.  Long  hours.  Bad 
conditions.  Went  to  Portland  to  work  for  the  same  company.  Later 
he  worked  on  a  boat  of  the  same  company.  Joined  the  new  Long- 
shoremen's Union.  This  fought  another  union  but  lost  out.  Went 
to  work  for  the  Columbia  Digger  Company.  Conditions  the  same. 
Work  the  same.  Worked  to  the  first  of  January,  19 14.  Got  laid 
off.  No  work.  Took  a  contract  to  chop  cordwood,  500  cords,  $1  a 
cord.  Spent  all  his  money  for  tools  and  provisions  and  shipment 
out  to  the  place— spent  about  Si 00.  When  he,  with  his  partner, 
got  there,  they  discovered  they  were  cheated  by  a  crooked  contractor. 
No  work. 

Returned  to  Portland.  Was  broke.  Partner  got  $10  from  his 
father.  Took  another  contract  to  clear  land,  two  acres,  $50  an  acre ; 
and  to  cut  100  cords  of  wood,  $1  a  cord ;  got  cheated  also ;  the  land 
was  harder  to  clear  than  the  owner  told.  It  rained  and  snowed  also. 
Left.  Did  not  earn  a  cent  during  one  and  one-half  months  of  work. 
Were  broke,  absolutely— provisions  all  gone,  the  farmer  did  not  even 
take  their  tools  to  the  depot,  because  he  had  not  time  ;  he  really 
wanted  to  have  their  tools.  Got  another  job  on  a  farm,  20  cents  an 
hour  to  clear  land  ;  got  potatoes,  apples,  and  milk  free.    Made  about 


FLOATING  LABORERS 


lOI 


$10.  Work  done.  Went  to  Portland.  Beat  his  way  to  Seattle. 
Nothing  doing  in  the  woods.  In  Seattle  about  a  week.  Stayed  with 
a  friend.  Went  back  to  Portland,  beat  it.  Broke.  Stayed  down  on 
the  dredge,  even  slept  there.  Went  hungry.  Went  to  work  for  that 
company — again  S60  a  month  and  own  board.  Worked  until  the 
latter  part  of  May.  No  work.  Laid  off.  Got  another  job  for  another 
company  as  a  deck  hand,  S45  a  month  ;  good  board ;  too  long  hours, 
—  fourteen  to  fifteen  hours,  sometimes  only  four  hours  for  sleeping ; 
slept  in  the  ''dog  hole."  Worked  twenty  days.  Quit — could  not 
stand  it.  Went  to  Seattle,  June  21  ;  no  work  in  Seattle.  Started  for 
harvest  in  Montana,  beating  his  way.  Got  ditched  lots  of  times. 
Paid  to  carmen,  for  the  tips,  from  25  to  50  cents  every  time.  He 
had  some  money,  bought  some  stuff.  Made  tramp  "mulligan"  in 
jungles.  No  jobs  in  Montana.  Thousands  of  idle  men  there;  you 
could  not  even  buy  a  job  there.  Came  to  Aberdeen,  then  to  Redfield ; 
ten  days  here,  out  of  work.  Had  money  for  first  two  or  three  days. 
Now  about  seven  days  broke.  Begging  of  farmers,  asking  for  work ; 
these  give  meals  anyhow.    Sleeps  in  box  cars  and  haystacks. 

Immediate  plans  :  to  work  here  in  the  harvest  fields,  then  in  North 
Dakota,  then  elsewhere  to  save  money,  to  go  home  to  his  mother  in 
Denmark,  and  to  stay  there  more  or  less  permanently. 

In  Los  x\ngeles  lived  with  a  girl  for  four  months  as  married 
people;  she  got  $5  in  a  department  store;  he  got  S13.50  a  week. 
The  best  time  he  ever  had  in  this  country.  Loved  each  other.  Could 
not  marry.   Wages  were  low ;  were  afraid. 

The  number  of  casual  laborers  is  growing  in  this  country.  More 
men  are  falling  into  the  ranks  of  down-and-outs  than  in  previous 
years.  Criticizes  American  Federation  of  Labor — the  form  of  or- 
ganization is  out  of  date  ;  most  of  the  leaders  are  controlled  by  big 
employers.  Criticizes  socialists.  They  have  turned  from  economic 
struggle  to  politics.  The  socialists  are  politicians  for  themselves. 
In  fact  they  have  traded  the  interests  of  the  working  people  for  the 
interests  of  the  petit  bourgeois. 

COMMENTS 

He  is  the  leader  and  spokesman  of  the  I.  W.  W.  people  and  also 
the  harvest  hands  (about  500)  in  Redfield.  He  is  quite  an  intelli- 
gent boy,  but  all  signs  show  that  he  is  going  downward.     If  he 


102       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

continues  to  migrate  he  may  become  a  hobo  and  afterwards  a  tramp 
of  the  common  type.  In  the  jungle  of  the  harvest  hands  he  addressed 
the  crowd.  All  the  men,  with  a  few  exceptions,  expressed  approval 
of  the  sentiments  of  the  speech  when  he  called  for  a  show  of  hands. 
He  did  not  mention  the  I.W.W.  nor  wear  an  I.W.W.  button,  and 
he  claimed  in  private  conversation  with  me  that  he  was  not  a 
member.  He  says  that  it's  too  hard  to  keep  up  the  50  cents  per 
month  dues.   Notes  taken  on  his  speech  are  as  follows : 


FLOATING  LABORERS 


103 


"Industrial  unrest?"  If  a  man  is  treated  like  a  dog  he's  a  fool  if 
he  don't  bark,  ain't  he?  People  accuse  us  of  advocating  violence. 
We  don't  believe  in  violence  except  for  self-protection.  All  societies 
protect  themselves  against  the  unsocial  acts  of  individuals.  Men 
are  hanged  for  murder,  for  example.  So  we  believe  that  we  have  the 
moral  right  to  prevent  a  man  from  working  for  $2.50  a  day  when 
we  are  fighting  for  $3. 

P.  W.  Speek 


■ 


The  great  things  that  need  to  be  done  are  to  reduce  the  hours  of 
labor  and  increase  the  wages.  If  the  hours  of  labor  are  reduced  from 
twelve  or  ten  to  eight,  more  men  will  be  employed  and  there  will  be 
less  unemployment.  If  the  hours  of  labor  are  reduced  enough  there 
will  be  work  for  everybody. 

You  men  have  got  to  stand  on  your  own  feet  and  help  yourselves. 
Nobody  else  will  help  you — neither  Jesus  Christ  nor  anyone  else 
sitting  up  in  the  clouds  above  you  can  do  anything  for  you.  Legis- 
lation is  bound  to  fail.  What  good  does  the  minimum  wage  law  do 
you  ?  The  courts  won't  stand  for  such  a  law  being  applied  to  men. 
Workmen's  compensation  laws  are  frauds.  If  a  man  gets  hurt,  what 
does  he  get?  Only  half  or  two  thirds  of  his  wages  and  that  at  a  time 
when  his  expenses  are  greater  than  usual.  We  are  not  interested  in 
old-age  pensions,  because  we  don't  live  long  enough  to  get  old. 
Labor  exchanges  won't  help  much.  I've  been  in  England  where  they 
have  them  and  where  they  have  old-age  pensions,  but  I  never  saw 
such  poverty  anywhere  as  I  saw  in  England.  We  have  child  labor 
laws  in  this  country,  but  they  are  not  enforced.  The  trouble  at 
Lawrence  showed  that.  Many  good  bills  are  introduced  by  well- 
meaning  men,  but  before  they  become  law,  if  they  become  law  at  all, 
they  are  twisted  all  out  of  shape  by  the  pressure  from  special  in- 
terests. President  Wilson  is  a  good  man.  I  voted  for  him  myself. 
But  what  can  he  do?  You  men  can  trust  no  one  but  your  own 
leaders,  and  even  your  own  leaders  sell  you  out  sometimes. 

W^e  have  no  interest  or  hope  in  political  action.  Most  of  us  are 
disfranchised,  because  we  can't  stay  long  enough  in  one  place  to  get 
a  vote.  We  have  to  keep  moving  to  find  work.  We  don't  bum  our 
way  on  the  railroads,  sleep  and  eat  in  the  jungles,  and  wear  poor, 
dirty  clothes  because  we  like  to  do  it.  We  do  it  because  we  can't 
help  ourselves.  Our  only  salvation  is  organization— one  big  organi- 
zation of  all  workers.  When  we  get  that  we  can  take  the  industries 
we  work  in  and  give  work  to  everybody.  Ownership  does  not  amount 
to  anything  then.  But  this  can't  all  be  done  in  a  day.  It  will  have 
to  be  done  gradually  and  you  men  will  have  to  do  it. 


THE  MEN  WE  LODGE 


105 


VIII 
THE  MEN  WE  LODGE  ^ 

L  WHO  THEY  ARE 

TO  THE  citizens  of  New  York  City  the  homeless  man  needs  no 
introduction.  According  to  a  census  made  by  the  New  York 
City  Police  Department  for  the  United  States  Bureau  of  Labor  Sta- 
tistics on  the  night  of  January  30,  191 5,  he  was  here  some  26,000 
strong,  spending  the  night  in  the  Municipal  Lodging  House,  at  the 
Farm  Colony  of  the  Department  of  Public  Charities,  at  the  Ellis 
Island  Immigration  Station,  in  immigrant  homes,  in  cheap  lodging 
houses,  in  employment  agencies,  in  missions,  in  the  rear  rooms  of 
saloons,  in  bread  lines,  and  on  public  thoroughfares.  No  observing 
person  has  walked  through  our  down-town  parks,  through  the  Bow- 
ery or  similar  streets,  without  having  at  least  a  passing  acquaintance 
with  him. 

Withdrawn  from  the  activities  and  responsibilities  of  a  normal 
family  life,  he  is  not  unlike  many  men  who,  living  in  hotels,  clubs, 
and  boarding  houses,  might  in  the  strict  sense  of  the  word  be  called 
homeless.  From  these  he  differs,  however,  in  that  his  loneliness 
is  often  accompanied  either  by  unemployment  or  by  a  complexity  of 
disabilities  which  make  him  unemployable.  He  is  not  only  home- 
less but  is  often  without  food,  shelter,  or  money,  and  in  most  cases, 
if  a  worker  at  all,  he  is  a  casual  laborer. 

To  the  citizens  who  come  into  closer  contact  with  the  homeless 
man  than  is  afforded  in  a  walk  through  the  Bowery  or  Union 
Square,  such  a  description  as  the  foregoing,  however,  proves  inade- 
quate and  misleading.  An  investigation  of  some  2000  men  whom 
New  York  City  lodged  at  the  Municipal  Lodging  House  in  March, 
1914,  indicated  that  there  is  no  one  type  of  homelessness,  and  that 

^From  Report  to  the  Advisory  Social  Service  Committee  of  the  Municipal 
Lodging  House,  New  York,  September,  191 5,  pp.  9-22. 

104 


no  two  homeless  people  are  alike.  Each  one  is  unique  in  himself : 
the  product  of  a  different  inheritance,  different  environments,  and 
different  experiences ;  the  possessor  of  a  different  disposition,  dif- 
ferent capabilities,  different  habits,  different  disabilities,  and  different 
needs. 

The  men  we  lodge  at  the  Municipal  Lodging  House  are  as  widely 
different  as  the  transient  guests  of  any  New  York  City  hotel.  They 
are  as  different  as  the  causes  which  have  taken  them  away  from  the 
normal  life  of  society.  There  are  old  men  over  seventy,  young 
runaway  boys,  orphans,  and  men  who  should  be  in  the  prime  of  life. 
There  are  strong  men,  crippled  men,  blind  men,  and  diseased  men 
in  urgent  need  of  hospital  care.  There  are  casual  laborers  who  have 
been  idle  less  than  one  week,  men  who  have  failed  in  their  business 
or  profession,  and  vagrants  who  frankly  avoid  work.  There  are 
men  who  have  spent  their  lives  in  New  York  City,  and  nonresidents 
and  aliens  with  no  legal  claim  on  the  city's  charity.  There  are  tem- 
perate men,  habitual  drug-users,  and  inebriates ;  men  who  are  nor- 
mally minded,  and  men  who  are  mentally  defective.  There  are 
professional  beggars  and  men  who  hold  the  beggar  in  contempt. 
There  are  white  men  and  colored  men  ;  single  men,  married  men  in 
search  of  work,  and  family  deserters ;  Catholics,  Protestants,  and 
Hebrews.  There  is  as  wide  a  divergency  among  homeless  men  as 
there  is  among  the  rest  of  mankind. 

II.  THEIR  CONDITIONS 

Given  the  best  will  in  the  world,  no  effort  to  deal  with  homeless- 
ness can  go  very  far  without  facts.  W^hen  men  gather  cold  and 
hungry  and  ragged  in  a  long  line  outside  the  Municipal  Lodging 
House,  no  one  can  tell  offhand  by  looking  at  them  why  they  are 
down  and  out,  or  how  they  can  be  helped  in  self-respecting  fashion 
back  to  the  normal  life  of  society. 

We  need  not,  however,  begin  in  absolute  ignorance,  thanks  to  a 
very  important  investigation  made  at  the  Municipal  Lodging  House 
in  March,  19 14,  under  the  direction  of  the  Commissioner  of  Public 
Charities.  Fifteen  hundred  men  were  studied  at  that  time  by  a 
staff  of  fifteen  investigators.  At  the  same  time  a  medical  examina- 
tion of  2000  men  was  conducted  by  fifteen  medical  examiners.    This 


i| 


lit 


I 


)i 


II 


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io6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

investigation  represented  the  first  large  attempt  in  America  to  find 
out  about  the  men  who  take  refuge  in  a  municipal  lodging  house. 

The  facts  brought  out  by  this  investigation  and  by  others  recently 
made  in  New  York  City  show  that  the  men  who  frequent  the 
Lodging  House  can  be  classified  roughly  into  two  distinct  though  con- 
stantly merging  groups  ;  namely,  the  unemployed  and  the  unem- 
ployable. There  has  been  no  adequate  method  perfected  for  the 
separation  of  unemployable  individuals  from  the  body  of  the  un- 
employed which  would  make  possible  any  sharp  classification. 

Out  of  1426  men  who  answered  the  inquiry  regarding  the  length 
of  time  they  had  been  unemployed,  only  6,  or  one  half  of  i  per 
cent,  claimed  to  be  working.  All  but  one  tenth  of  the  total,  1274 
men,  had  been  unemployed  over  one  week ;  and  924,  practically 
two  thirds,  had  been  out  of  work  for  over  a  month.  One  hundred 
and  two  of  the  men  had  been  idle  over  six  months. 

These  figures,  of  course,  refer  only  to  the  length  of  time  the 
men  had  been  idle  prior  to  their  investigation  in  March,  19 14.  They 
do  not  indicate  how  long  the  men  had  been  previously  employed 
or  how  frequent  had  been  the  periods  of  their  past  unemployment. 
It  should  be  pointed  out,  moreover,  that  this  inquiry  preceded  the 
more  abnormal  period  of  unemployment  in  the  winter  of  19 14-19 15. 

The  reasons  given  by  the  applicants  for  coming  to  New  York 
City  were  tabulated  only  in  the  case  of  those  who  had  been  here  for 
six  months  or  less.  Out  of  417  of  these,  306,  a  large  majority, 
claimed  to  have  come  to  this  city  in  search  of  work.  While  it  is 
necessary  to  make  allowance  for  probable  inaccuracies  in  many  of 
these  claims,  they  undoubtedly  indicate  conditions  of  honest  unem- 
ployment in  the  case  of  a  substantial  number  of  men  who  frequent 
the  Municipal  Lodging  House  yearly. 

This  conclusion  was  substantiated  by  letters  received  from  past 
employers  of  many  of  the  men.  These  letters  point  out  that,  in  a 
number  of  cases,  the  unemployment  of  men  was  due  neither  to  their 
inability  to  hold  a  job  nor  to  their  unwillingness  to  work,  but  simply 
to  the  fact  that  they  could  not  find  work. 

The  following  extracts  are  illustrative : 

(i)  A  chemical  manufacturer :  "P.  F.  employed  here  as  a  pol- 
isher and  washer.  Work  satisfactory.  Services  not  required  after 
busy  season." 


THE  MEN  WE  LODGE 


107 


(2)  An  automobile  dealer:  "J.  I.  was  honest,  reliable,  and  effi- 
cient. He  left  here  on  account  of  the  slackness  of  business.  Would 
reemploy  him  in  our  busy  season." 

(3)  A  building  contractor:  "J.  L.  left  because  our  work  was 
completed.  We  expect  to  resume  work  about  March  25  and  might 
be  able  to  reemploy  him  then." 

(4)  A  bridge  contractor:  "C.  S.  left  because  of  the  comple- 
tion of  work.   We  would  reemploy  him  if  conditions  were  favorable." 

(5)  The  manager  of  a  shirt  company:  "We  would  reemploy 
J.  M.  if  work  were  not  so  slow." 

(6)  A  teaming  contractor:  "  G.  K.  left  my  employ  because  of 
the  scarcity  of  work.  Scarcity  of  labor  in  this  country  has  put  many 
a  good  man  on  the  road  without  money  or  food." 

These  letters  bear  out  a  fact  that  is  now  well  recognized.  A 
United  States  Census  Report  of  19 10  showed  that  in  the  preceding 
year  a  total  of  117,806  more  persons  were  employed  in  the  manufac- 
turing industries  of  New  York  State  in  January  than  in  October. 
Such  fluctuations  in  the  demand  for  labor  are  not  confined  to  one 
industry  or  to  one  season;  and  occasionally,  as  in  the  winter  of 
1914-1915,  they  demoralize  the  entire  labor  market.  Unfortunately, 
the  casual  laborer — who  all  too  frequently  becomes  also  the  home- 
less man — is  made  to  bear  the  brunt  of  these  fluctuations. 

Of  the  2000  men  who  were  given  a  medical  examination,  1774, 
approximately  9  out  of  every  10,  were,  according  to  the  adjudg- 
ments of  the  examining  physicians,  physically  able  to  work.  Twelve 
hundred  and  forty-seven,  or  62  per  cent  of  the  total,  were  con- 
sidered physically  able  to  do  regular  hard  manual  labor ;  354,  or  18 
per  cent,  to  do  medium  hard  work;  and  173,  or  9  per  cent,  to  do 
light  work  only.  Two  hundred  and  twenty-six,  i  out  of  every  10, 
were  adjudged  physically  unable  to  work.^ 

The  results  of  this  investigation  show,  moreover,  that  a  substan- 
tial proportion  of  the  men  who  apply  at  the  Municipal  Lodging 
House  are  unemployable — men  whose  unenviable  lot  it  is  to  be  the 
less  fit  in  the  struggle  for  survival.  Many  homeless  men,  though 
willing  and  anxious  to  work,  are  chronically  unemployed  because 
they  are  too  inefficient  to  hold  a  job  even  under  normal  indus- 
trial conditions.    More  efficient  than  these,  yet  less  eflicient  than 

1  These  226  men  do  not,  however,  include  all  of  the  unemployables  found 
within  this  group. 


\m 


14 


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io8       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

normal  workers,  are  many  others,  frequently  unemployed  because 
they  are  the  first  to  be  dropped  from  the  pay  roll  when  work 
becomes  "slack."  Many  others,  moreover,  are  unemployable  be- 
cause, being  neither  anxious  nor  willing  to  work,  they  frankly  avoid 
employment. 

The  factors  behind  the  inefficiency  of  a  man  have  usually  im- 
bedded themselves  so  far  into  his  past  that  a  clean-cut  dissection 
of  them  is  practically  impossible.  No  such  experiment  was  attempted 
in  this  Municipal  Lodging  House  investigation.  Certain  conspicuous 
factors,  however,  were  frequently  found  contributing  to  the  inef- 
ficiency of  the  men  investigated.  These  fall  naturally  around  six 
distinct  though  constantly  merging  groups  of  inefficient  homeless 
men.  They  are  (i)  the  physically  handicapped,  (2)  the  mentally 
handicapped,  (3)  the  inebriate,  (4)  the  habitually  idle,  (5)  the 
untrained,  and  (6)  the  aged. 

Of  the  2000  men  who  were  examined  by  the  physicians,  226, 
or  II  per  cent,  were  adjudged  physically  unable  to  work;  80,  or 
4  per  cent,  were  temporarily  disabled,  and  146,  or  7  per  cent,  were 
permanently  disabled.  Fifty-nine  of  the  2000  men  had  disabilities 
which  demanded  hospital  treatment,  and  239  of  them  were  recom- 
mended for  dispensary  treatment.  The  leading  factor  physically  in- 
capacitating men  for  work  was  tuberculosis;  others  were  senility, 
nephritis,  heart  disease,  acute  pleurisy,  and  blindness. 

That  a  number  of  the  homeless  men  included  in  this  investigation 
were  mentally  defective  and  in  that  respect  unemployable  is  evi- 
dent from  a  study  of  the  records  of  some  200  who  were  examined 
by  the  Clearing  House  for  Mental  Defectives.  The  following  ex- 
tracts from  the  records  of  some  of  these  men  are  illustrative : 

No.  90.  A  laborer,  age  twenty-four,  had  spent  his  life  in  New 
York  City.  "  Patient  presents  a  very  simple,  foolish  attitude ;  he 
has  no  judgment,  does  not  reason,  and  has  absolutely  no  purpose  in 
life.  He  does  not  care  to  work  but  begs  and  bums  his  way.  He 
has  no  friends  and  is  a  recluse.  He  is  mentally  defective."  He  had 
served  a  six  months'  sentence  on  Blackwcll's  Island  for  vagrancy. 

No.  1152.  A  laborer,  age  fifty,  had  been  in  the  United  States 
twenty-five  years  and  in  New  York  City  fifteen  vears.  He  was 
diagnosed  as  an  imbecile.  He  had  never  held  a  job  for  over  six 
months,  working  only  long  enough  to  get  money  with  which  to 
become  intoxicated. 


THE  MEN  WE  LODGE 


109 


Of  1482  men  who  made  statements  regarding  their  habits,  1292 
—  approximately  9  out  of  every  10  —  said  that  they  drank  alco- 
holic liquors.  Six  hundred  and  fifty-seven,  or  44  per  cent,  said 
that  they  drank  excessively;  635,  or  43  per  cent,  said  that  they 
drank  moderately;  and  190,  or  13  per  cent,  claimed  to  be  total 
abstainers. 

Of  the  2000  men  who  were  given  a  medical  examination,  775, 
or  39  per  cent,  were  diagnosed  as  suffering  from  alcoholism.  Ac- 
cording to  Dr.  James  Alexander  Miller,  these  "figures  probably  do 
not  represent  by  any  means  the  number  of  individuals  who  were 
alcoholic  .  .  .  but  are  rather  indicative  only  of  the  number  who 
manifested  acute  evidence  of  that  condition  at  the  time  of  the  investi- 
gation." Not  infrequently  were  responses  from  past  employers  of 
these  men  such  as  are  here  quoted : 

"His  failing  was  drink.    I  would  not  employ  him  again." 

"He  used  intoxicating  liquor  to  such  an  extent  as  to  hinder  his 
work."  ' 

"Drink  interfered  with  his  work.  If  he  could  keep  away  from 
liquor,  he  would  be  O.  K." 

"Discharged  for  drunkenness." 

Of  the  102  men  who  had  been  unemployed  over  six  months,  50 — 
approximately  i  out  of  every  2 — had  been  idle  one  year  or  over. 
The  means  by  which  they  lived  is  indicated  in  the  answers  of  1482 
of  the  men  investigated.  Of  this  number,  317  —  i  out  of  every  5  — 
admitted  that  they  begged  either  occasionally  or  regularly. 

Some  of  these  men  had  degenerated  through  repeated  periods  of 
idleness  into  a  voluntary  state  of  unproductiveness  and  parasitism. 
Others  were  unemployed,  apparently,  because  they  had  never  dis- 
ciplined themselves  to  obey  orders.  Others,  moreover,  were  unable  to 
keep  their  minds  on  their  work,  either  because  they  were  obsessed 
witji  an  idea  that  they  were  more  fit  for  something  else,  perhaps  in  a 
different  city  or  state,  or  because  some  misfortune,  such  as  the  loss  of 
a  friend,  had  left  them  without  the  initiative  and  the  purpose  which 
had  made  their  work  worth  while. 

Given  a  well-stocked  market  of  unskilled  laborers,  the  less  fit  — 
those  handicapped  by  some  physical  or  mental  defect — are,  obviously, 
forced  either  to  look  to  other  sources  than  to  unskilled  labor  for 
their  livelihood  or  to  become  dependent.     Unfortunately  they  are 


)i 


ii 


N 


i    * 


no       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

all  too  often  forced  to  choose  the  latter  alternative,  because  they  lack 
the  training  required  for  positions  which  they  might  otherwise  ca- 
pably fill.  The  records  of  this  investigation  show  that  a  number  of  the 
men  interviewed  could  have  been  self-supporting  if  they  had  been 
trained  in  some  occupation  which  they  were  physically  and  mentally 
able  to  carry  on.  Such  statements  as  the  following  were  not  in- 
frequently received  from  past  employers  of  these  men : 

"Get  suitable  work  for  him." 

"  Might  be  all  right  in  the  right  place." 

"He  should  have  better  education  in  the  trade." 

Even  in  a  Utopian  society  one  might  expect  to  find  a  certain 
number  of  old  people  among  the  unemployable.  Although  most  of 
the  men  included  in  this  investigation  had  left  the  ranks  of  industry 
for  causes  other  than  old  age,  the  examining  physicians  found  se- 
nility, next  to  tuberculosis,  to  be  the  largest  single  factor  leading  to 
permanent  physical  disability.  Out  of  146  permanently  disabled  men, 
14— I  out  of  every  10— were  unable  to  work  on  account  of  old  age. 
It  was  found,  moreover,  that  of  1467  men  who  gave  their  ages, 
115— I  out  of  every  13— were  sixty  years  of  age  or  over.  Eleven 
of  the  men  were  seventy  or  over. 

Physical  disability,  retarded  mentality,  inebriety,  habitual  idle- 
ness, lack  of  training,  and  old  age,— these  are  some  of  the  factors 
frequently  found  contributing  to  the  inefficiency  of  these  men. 
Perhaps  in  no  single  instance  does  any  one  of  them  appear  alone. 
In  many,  several  are  found  in  various  combinations.  With  the 
exception  of  old  age,  each  of  these  factors  augments  and  is  aug- 
mented by  the  others,  and  all  of  them  contribute  jointly  to  the 
production  of  a  group  of  dependents,  more  or  less  unemployable, 
who  are  the  city's  recurrent  guests  at  the  Municipal  Lodging  House! 
This  investigation,  moreover,  revealed  the  fact  that  among  the 
lodgers  at  the  Municipal  Lodging  House  were  many  men  who  had 
no  legal  claim  upon  the  city's  hospitality.  According  to  the  state 
charities  law,  at  least  one  year  in  residence  is  required  before  a 
person  can  become  a  legal  resident  of  New  York  City,  which  alone 
would  make  him  a  bona  fide  legal  claimant  of  the  city's  charity. 

Of  the  1429  men  who  stated  the  time  they  had  been  in  New  York 
City,  588  —  2  out  of  every  5— had  not  been  here  over  one  year, 


THE  MEN  WE  LODGE 


III 


while  322  —  I  out  of  every  5  —  had  not  been  here  over  two  months. 
One 'tenth,  or  141,  of  the  men  had  not  been  here  over  ten  days. 
Some  of  these  men  were  residents  of  other  counties  and  states ; 
some  were  aliens,  and  some  were  runaway  boys. 

Of  the  1448  men  who  stated  their  birthplace,  621,  or  43  per 
cent,  were  foreign  born.  Thirty-six  of  these  men  had  not  been  in 
the  United  States  over  one  year,  and  74  had  not  been  here  over  three 
years.  There  were,  moreover,  304  applicants  at  the  Municipal 
Lodging  House  in  March,  19 14,  who  were  rejected  from  this  investi- 
gation because  they  could  not  speak  English.  Had  these  men  been 
included,  these  numbers  would  have  been  much  larger. 

The  federal  government  has  the  power  of  removal  of  an  alien 
improperly  admitted  to  the  United  States,  but  this  power  ceases 
after  he  has  been  in  this  country  three  years.  The  law  of  New 
York,  however,  gives  the  State  Board  of  Charities  unlimited  author- 
ity for  the  removal  of  alien  and  nonresident  poor.    The  law  reads : 

The  State  Board  of  Charities,  and  any  of  its  members  or  offi- 
cers, may,  at  any  time,  visit  and  inspect  any  institution  subject  to 
its  supervision  to  ascertain  if  any  inmates  supported  therein  at  a 
state,  county  or  municipal  expense  are  state  charges,  non-residents 
or  alien  poor  ;  and  it  may  cause  to  be  removed  to  the  state  or  country 
from  which  he  came  any  such  non-resident  or  alien  poor  found  in 
any  such  institution.  (State  charities  law,  constituting  Chapter  55 
of  the  Consolidated  Laws,  Section  17.) 

According  to  the  secretary  of  the  State  Board  of  Charities,  how- 
ever, it  is  the  policy  of  that  body  to  return  nonresident  and  alien-poor 
inmates  of  the  Municipal  Lodging  House  only  in  very  exceptional 
cases.  "In  the  first  place,"  the  secretary  states,  "the  board  doubts 
the  wisdom  of  returning  them  generally,  and  in  the  second  place  it 
does  not  have  an  appropriation  sufficient  for  the  purpose." 

Following  are  extracts  from  the  records  of  some  of  the  nonresi- 
dent and  alien  applicants  among  the  men  investigated  at  the  Munici- 
pal Lodging  House  in  IVIarch,  19 14,  who  were  subject  to  removal 
from  the  state  under  the  law : 

No.  QQ2.  An  English  seaman,  age  sixty-three,  had  been  in  the 
United  States  and  in  New  York  City  eight  weeks,  during  which 
time  he  had  been  idle.  He  had  been  discharged  from  a  ship  while 
in  this  port  because  of  a  broken  thigh. 


il 


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112       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

No,  J258.  A  resident  of  Massachusetts,  age  twenty-seven,  had 
been  in  New  lork  City  five  weeks.  Except  for  a  few  jobs  at  sjiow- 
shoveling,  he  had  been  idle  during  this  entire  time.  His  brother 
wrote  that  the  man  had  a  home  in  Massachusetts. 

^0.  ijjy.  A  resident  of  Pennsylvania,  age  twenty-three,  had 
been  in  New  York  City  one  day.  In  that  state  he  had  been  an 
inmate  of  a  penal  institution  for  one  year.  A  past  employer  wrote 
that  he  thought  the  man  was  mentally  defective.  His  father  wrote, 
"  I  hope  he  will  soon  return  home." 

No.  1377.  A  German  candy-maker,  age  twenty-seven,  had  been 
in  the  United  States  and  in  New  York  City  two  years.  He  had 
been  at  the  IMunicipal  Lodging  House  ten  times  in  January,  1914, 
and  had  served  a  thirty-day  sentence  at  the  workhouse. 

Of  the  1467  applicants  giving  their  ages,  26  were  boys  under 
nineteen  years  of  age,  and  48  were  under  twenty-one.  Eleven  of 
these  boys  were  foreign  born ;  16  were  native  born  of  foreign  parent- 
age;  and  20  were  native  born  of  native  parentage.  That  a  number 
of  them  had  run  away  from  their  homes  was  shown  by  their  own 
statements  and  by  letters  from  their  friends  and  relatives. 

No.  325.  An  American  boy,  age  nineteen,  came  to  New  York 
City  "to  see  the  town"  two  months  prior  to  his  application  at  the 
Municipal  Lodging  House.  His  father  wrote  from  New  Orleans 
that  the  boy  had  run  away  from  a  good  home  there.  He  asked  to 
have  the  boy  returned. 

No.  363.  A  New  York  City  boy,  age  nineteen,  had  run  away 
from  his  grandfather's  home  in  the  Bronx.  The  grandparent  wrote 
that  he  had  given  the  boy  a  good  home,  but  that  he  had  run  away. 

No.  107 1.  An  American  boy,  age  seventeen,  had  "bummed"  his 
way  to  New  York  City  four  days  prior  to  his  application  at  the 
Municipal  Lodging  House.  He  had  run  away  from  his  aunt's  home 
in  Washington,  D.  C,  to  visit  a  sister  in  New  York,  whose  address 
he  did  not  know.    His  aunt  wrote,  "  Send  him  to  me  at  once." 

HI.  THEIR  NEEDS 

The  need  for  food  and  shelter  is  practically  the  only  one  com- 
mon to  all  of  the  men  who  apply  at  the  Municipal  Lodging  House. 
It  is  a  need,  fortunately,  which  the  city  can  meet  en  masse  by  the 
provision  of  so  many  beds,  so  many  loaves  of  bread,  so  much  soup, 
so  many  cups  of  coffee,  so  many  bowls  of  cereal,  so  much  milk,  so 
much  sugar,  a  building  for  the  housing  of  these  supplies,  and  a 
force  of  employees  for  their  administration. 


THE  MEN  WE  LODGE 


113 


fM 


But  have  the  needs  of  the  lodgers  been  met  when  they  have  been 
fed  and  given  a  night's  lodging  ?  Is  this  common  need  the  greatest 
need  presented  by  all  or  by  any  one  of  them  ?  Obviously  it  is  not. 
They  need  food  and  shelter  because  they  lack  the  means  of  self- 
maintenance.  They  lack  the  means  of  self-maintenance  either  be- 
cause they  cannot  find  a  job  or  because  they  are  handicapped  by 
physical  and  mental  abnormality,  by  inebriety,  habitual  idleness, 
lack  of  training,  or  old  age  and  are  therefore  unable  to  hold  a  job 
when  they  find  one. 

From  the  facts  brought  out  in  these  investigations,  it  is  obvious 
that  any  constructive  program  for  meeting  the  needs  presented  by 
the  homeless  must  be  directed  toward  all  of  their  disabilities.  The 
whole  man  must  be  treated,  not  merely  his  appetite  and  his  desire 
for  sleep. 

Food  and  shelter  may  be  the  individual's  greatest  need.  In 
most  cases,  undoubtedly,  it  is  not.  It  is  but  a  symptom  of  another 
need — the  need  of  a  job,  or  the  need  of  constructive  treatment  for 
those  disabilities  which  keep  him  from  a  job. 

Every  man  who  applies  for  food  and  shelter  at  the  Municipal 
Lodging  House  should  have  a  social  investigation  as  well  as  a 
physical  examination  in  order  that  an  intelligent  diagnosis  of  his 
condition  can  be  made.  Facts  can  thus  be  obtained  which  will  serve 
as  the  basis  for  an  intelligent  plan  for  his  treatment. 

The  old  method  of  lodging  the  homeless  man  and  passing  him 
on  or  imprisoning  him ;  of  giving  him  work  in  a  wood  or  stone  yard 
or  directing  him  to  the  nearest  employer,  with  little  regard  for  the 
complicated  causes  of  his  condition  and  less  for  the  opportunity  of 
developing  within  him  the  power  of  self-maintenance,— the  old  pro- 
gram has  been  wasteful,  wasteful  of  men  and  wasteful  of  the  city's 
charity  fund. 

Each  homeless  man  who  applies  at  the  Municipal  Lodging  House 
needs  individual  attention.  Otherwise  he  would  not  be  there.  Be- 
hind his  need  for  food  and  shelter  are  basic  needs  which  demand 
intelligent  diagnosis  and  treatment.  The  employable  man  without 
a  job  needs  to  be  directed  toward  a  job  without  a  man — a  job  for 
which  he  is  fitted.  The  unemployable  man  needs  either  to  be  treated 
for  the  causes  of  his  dependency,  to  be  protected  from  the  competi- 
tion of  the  more  fit,  or  to  receive  both  such  treatment  and  protection. 


ji 


,  .tit 

'iV- 


II 


it 


114       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  physically  handicapped  need  to  be  healed  as  far  as  is  within 
medical  and  surgical  power  to  heal ;  the  mentally  handicapped 
need  to  be  segregated,  protected,  and  trained ;  the  inebriates  need 
to  be  restored  to  health  and  disciplined  for  rational  living ;  the 
habitually  idle  need  to  be  constrained  (or  compelled)  to  work;  the 
untrained  need  to  be  directed  toward  an  occupation  at  which  they 
can  earn  a  livelihood  and  be  trained  for  self-support ;  and  the  aged 
need  to  be  placed  in  homes.  Dependent  nonresidents,  aliens,  and 
runaway  boys  need  to  be  returned  to  their  homes  and  to  their 
friends.  If  agencies  for  meeting  these  needs  were  maintained  and 
coordinated  in  the  Municipal  Lodging  House  as  a  central  clearing 
house  for  the  homeless,  that  institution  would  serve  as  an  avenue 
of  approach  not  only  to  a  meal  and  a  bed,  or  perchance  to  prison, 
but  to  rehabilitation. 

Robert  B.  Brown 


I! 


IX 

INTERSTATE  MIGRATION  OF  NEGRO 

POPULATION^ 

FOR  a  clear  understanding  of  the  northern  migration  of  negroes 
in  the  years  191 6  and  191 7  a  knowledge  of  the  general  move- 
ment of  the  negro  population  since  1865  will  prove  very  useful.  Sev- 
eral recent  writers  have  been  prone  to  emphasize  the  development  in 
the  negro  within  the  past  two  years  of  "a  sudden  desire  to  move," 
but  a  little  investigation  soon  reveals  the  fact  that  the  black  man,  ever 
since  the  day  of  his  emancipation,  has  shown  a  tendency  to  migrate. 

At  the  close  of  the  Civil  War,  when  told  that  he  was  free,  the  negro 
at  once  began  to  put  his  freedom  to  the  test ;  and  as  the  most  palpable 
evidence  of  his  liberty  was  his  ability  to  come  and  go  as  he  chose,  it 
was  only  natural  that  he  should  begin  to  move  about.  At  the  end 
of  every  year  thousands  of  tenants  in  the  Southern  black  belts  may 
still  be  seen  removing  to  other  farms,  in  many  cases  without  even 
taking  the  pains  to  examine  beforehand  the  lands  they  are  to  culti- 
vate or  the  houses  they  are  to  occupy.  Such  migrations  do  not  appear 
in  the  census  returns,  but  their  social  and  economic  importance  is 
far-reaching.  Dr.  Booker  T.  Washington  often  found  it  necessary  to 
urge  his  people  to  abandon  their  moving  propensities  and  to  settle 
down  and  acquire  property.  At  gatherings  of  negro  farmers  he  was 
fond  of  narrating  a  homely  story  of  a  chicken  which  belonged  to  one 
of  these  peripatetic  tenants  and  which,  from  long-acquired  habit, 
would  walk  up  to  its  owner's  cabin  door  on  every  first  of  January 
and  squat  down  and  offer  its  legs  to  be  tied,  preparatory  to  its 
journey  to  the  next  farm. 

The  possibility  of  the  migration  of  a  great  number  of  freedmen 
from  some  sections  of  the  South  became  evident  almost  as  soon  as 
the  Civil  War  was  over,  and  as  early  as  November  27,  1866,  Gov- 
ernor James  L.  Orr,  of  South  Carolina,  stated  in  a  message  to  the 
legislature  that  the  negroes  were — 

iFrom  Journal  of  Political  Economy,  Vol.  XXV  (191 7),  PP-  1034-1043. 


VT-9  -jr^WL-  -•HKSr>A«U 


Hi 


11! 


II 


Ii6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

invaluable  to  the  productive  resources  of  the  state,  and  if  their  labor 
be  lost  by  removal  to  other  sections,  it  will  convert  thousands  of 
acres  of  productive  land  into  a  dreary  wilderness.  For  this  reason, 
I  have  felt  it  to  be  my  duty  to  discourage  their  migration.  The  short 
crops  of  the  present  year  should  stimulate  the  planter  and  farmer  to 
renewed  energy  and  enterprise.  He  will,  however,  find  his  lands  of  lit- 
tle value  if  he  cannot  command  labor  to  cultivate  them.  If  the  negro 
remain  here,  his  labor  must  be  made  sufficiently  remunerative  to  sub- 
sist and  clothe  him  comfortably.  Schools  must  be  established  to 
educate  his  children,  and  churches  built  for  his  moral  training.^ 

This  threatened  migration,  to  which  Governor  Orr  referred,  was 
a  westward  movement,  from  South  Carolina,  Georgia,  Alabama,  and 
Mississippi  to  Louisiana,  Arkansas,  and  Texas.  It  differed  materially 
from  the  later  migration  to  the  North.  In  general,  the  westward 
movement  in  our  country  is  actuated  by  causes  similar  to  those  that 
prompt  European  migration  to  America.  It  is  a  movement  from  a 
highly  developed,  densely  populated  region,  where  the  economic  stress 
is  acute,  to  a  region  more  sparsely  populated,  with  undeveloped  re- 
sources, where  the  struggle  for  existence  is  not  so  keen.  This  ex- 
plains the  lure  of  the  Southwest  for  the  negro,  as  well  as  that  of  all 
the  West  for  the  white  man.  But  there  is  another  movement  of 
population  that  operates  in  a  manner  quite  the  reverse  of  the  prin- 
ciples just  enunciated.  This  is  the  cityward  movement,  a  migration 
to  a  region  of  denser  population,  keener  competition,  and  more  acute 
economic  stress.  Such  a  movement  is  the  Northern  exodus  of  negroes 
in  1916-1917. 

In  the  late  sixties  and  early  seventies  the  westward  migration  of 
negroes  attained  considerable  headway.  It  was  at  first  a  movement 
of  individuals  and  soon  became  one  of  groups.  Railway  and  land 
companies  carefully  fostered  it  and  had  their  agents  in  various  sec- 
tions of  the  South,  very  much  as  transatlantic  steamship  companies 
have  maintained  their  runners  in  the  remote  rural  districts  of  southern 
and  eastern  Europe  to  encourage  emigration  to  America.  A  well- 
known  negro  educator  states  that  in  1874  he  heard  one  of  these  agents 
boast  that  he  had  induced  35,000  persons  in  South  Carolina  and 
Georgia  to  leave  for  Arkansas  and  Texas.-    This  westward  movement, 

1  South  Carolina  House  Journal  (1866),  pp.  20-21. 

-W.  H.  Crograan,  Talks  for  the  Times  (Atlanta,  1896),  p.  54.  The  agent's 
statement  is  probably  much  exaggerated,  but  there  must  have  been  a  consider- 
able migration  to  have  prompted  him  to  make  such  a  claim. 


INTERSTATE  MIGRATION  OF  NEGROES 


117 


however,  was  soon  dwarfed  into  insignificance  by  a  threatened  migra- 
tion on  an  unprecedented  scale  to  Kansas  from  the  lower  Mississippi 
Valley  early  in  the  spring  of  1879.  The  ''  Kansas  Exodus,"  as  it  came 
to  be  called  from  its  alleged  resemblance  to  the  flight  of  the  Israelites 
from  Egypt,  presents  several  striking  analogies  to  the  movement  of 
1916-1917.  When  the  exodus  to  Kansas  began,  there  was  the  same 
suspicion,  as  noted  in  19 16,  that  it  was  the  result  of  efforts  to  colonize 
negro  voters  in  the  North  and  make  certain  states  safely  Republican. 
In  both  cases  this  suspicion  was  finally  allayed.  There  were  also,  in 
1879  as  in  1916,  the  assumption  by  a  portion  of  the  Northern  press 
that  the  negro  was  fleeing  North  to  escape  ill  treatment,  and  the 
tendency  on  its  part  to  lecture  the  South  for  its  shortcomings  in 
dealing  with  the  black  man.  One  may  also  note,  in  both  instances, 
the  same  sort  of  uneasiness  among  the  planters  in  those  districts  from 
which  emigration  had  been  excessive,  the  same  assurance  by  some 
that  all  of  the  negroes  would  eventually  return,  and  the  same  intro- 
spective editorials  in  Southern  newspapers,  with  the  candid  admission 
that  conditions  might  be  better  for  the  negro,  but  with  the  added 
assertion  that  even  as  things  were  the  South  was  a  better  place  for 
him  than  the  North.  In  both  instances  also  may  be  observed  the 
final  recognition  that  the  causes  of  the  movement  were  basically 
economic.  Of  course,  there  are  certain  contrasts  as  well  as  parallels 
in  these  two  movements,  but  the  latter  appear  to  be  by  far  the  more 
significant. 

The  Kansas  movement  of  1879  was  due  in  large  measure  to  the 
agricultural  depression  in  the  lower  Mississippi  Valley,  but  it  was 
precipitated  by  the  activities  of  a  host  of  petty  negro  leaders  who 
sprang  up  in  all  parts  of  the  South  during  the  period  of  reconstruc- 
tion. Foremost  among  these  were  Benjamin  (better  known  as 
"Pap")  Singleton,  of  Tennessee,  and  Henry  Adams,  of  Louisiana. 
Singleton  styled  himself  the  "Moses  of  the  Exodus"  and,  personally 
supervised  the  planting  of  several  colonies  in  Kansas.^  Adams 
claimed  to  have  organized  a  colonization  council  which  attained  a 
membership  of  98,000.- 

The  exodus  to  the  "Promised  Land"  of  Kansas  began  early  in 

^W.   L.  Fleming,  "'Pap'  Singleton:  the  Moses   of   the   Colored   Exodus," 
American  Journal  of  Sociology,  Vol.  XV,  pp.  61-82. 
2  Senate  Report,  693,  Part  II,  46  Cong.,  2  Sess. 


f   A  I 


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li8      TBLADE  UNIONISM  AND  LABOR  PROBLEMS 

March,  1879,  and  continued  until  May.    The  total  number  of  emi- 
grants, most  of  whom  went  to  Kansas  from  Louisiana  and  Missis- 
sippi, has  been  estimated  at  all  the  way  from  5000  to  10,000,  and 
many  thousands  more  had  planned  to  move,  but  were  deterred  by  the 
misfortunes  of  those  who  constituted  the  vanguard.   Leaving  their 
homes  when  the  weather  was  becoming  warm,  the  early  emigrants 
reached  Kansas  when  spring  chanced  to  be  unusually  backward  and 
the  country  was  still  bleak  and  desolate.    Thinly  clad  and  often 
without  funds,  they  endured  much  suffering  from  want  and  sickness, 
and  many  of  them  became  public  charges.    Societies  were  organized 
expressly  to  care  for  the  "refugees,"  as  they  were  called,  and  large 
numbers  returned  to  their  homes  as  soon  as  they  were  able,  giving 
such  dismal  reports  on  their  arrival  as  to  dissuade  others  from  fol- 
lowing their  example.    Perhaps  a  third  of  the  emigrants  remained, 
and  many  of  these  eventually  attained  a  fair  degree  of  prosperity. 
The  movement  was  ill-advised,  and  too  much  based  on  the  negro's 
sentimentalism.    To  him   Kansas,  pictured   as  the  home  of  John 
Brown  and  the  scene  of  many  free-soil  victories,  seemed  to  be  the 
ideal  home  for  the  black  man.    But  he  found  on  arriving  a  harsh 
climate,  pioneer  conditions,  and  small  farmers  who  had  no  need  of 
extra  laborers  and  who  were  not  especially  friendly  to  the  negro. 
That  individuals  from  among  this  group  of  emigrants  could  surmount 
such  difficulties  and  attain  no  small  degree  of  well-being  is  to  the 
credit  of  the  race.    While  the  exodus  caused  much  suffering,  de- 
moralization, and  loss  of  property  among  the  emigrants,  it  seems  to 
have  had  at  least  one  good  result.    In  some  instances  it  is  said  to 
have  caused  an  improvement  in  the  condition  of  the  negroes  who 
remained  at  home.    In  communities  where  there  had  been  consider- 
able emigration  there  was  said  to  have  been  a  tendency  to  reduce 
rents  and  to  offer  the  remaining  tenants  more  favorable  terms  in 
general  than  had  obtained  prior  to  the  exodus.    Such  a  result  would 
naturally  be  expected. 

In  1 888- 1 889  there  was  a  considerable  migration  of  negroes  from 
southern  Alabama  to  Arkansas  and  Texas,  as  a  result  of  the  activi- 
ties  of  labor  agents.^  The  rapid  development  of  the  mining  indus- 
try of  Alabama  in  the  nineties  caused  a  rapid  influx  of  negroes  into 
the  mineral  regions  around  Birmingham  and  was  the  cause  of  much 
^Southern  Farmer,  Atlanta,  Georgia,  June,  1889. 


INTERSTATE  MIGRATION  OF  NEGROES 


119 


uneasiness  among  the  cotton  growers  of  the  black  belt.  The  advent 
of  the  boll  weevil  caused  a  great  migration  of  colored  farmers  in 
1 908-1 909  from  the  cotton  fields  to  the  cane  fields  of  Louisiana. 
By  19 14  the  cotton  belt  of  this  state  had  recovered  from  the  de- 
moralization that  followed  the  advent  of  the  weevil ;  and  the  sugar 
planters,  depressed  by  the  prospects  of  free  sugar,  were  reducing  their 
acreage  and  employing  fewer  laborers.  A  tendency  toward  a  counter 
migration  then  showed  itself,  and  labor  agents  again  were  active.^ 
These  instances  are  cited  in  order  to  indicate  that  the  Northern 
migration  of  19 16-19 17  is  no  new  and  strange  phenomenon.  It 
differs  from  earlier  movements  chiefly  in  the  matter  of  numbers  in- 
volved. The  European  war  has  simply  hastened  and  intensified  a 
movement  that  has  been  under  way  for  half  a  century.  To  the  truth 
of  this  statement  the  reports  of  the  census  bear  eloquent  witness. 
In  i860  there  were  344j7I9  negroes  in  the  North;  in  1910  there 
were  1,078,336,  an  increase  of  212.8  per  cent  for  the  fifty-year 
period.  In  the  South  for  the  same  period  the  rate  of  increase  was 
1 1  I.I  per  cent.  In  the  last  half  century,  therefore,  the  relative  in- 
crease of  negroes  in  the  North  has  been  nearly  double  that  in  the 
South.  This  shows  a  decided  change  from  the  conditions  prevailing 
before  the  Civil  War.  At  every  census  before  i860,  except  that  of 
1840,  the  negro  population  of  the  South  showed  a  greater  relative  in- 
crease than  that  of  the  North.  Since  i860,  however,  the  situation 
has  been  reversed,  as  is  indicated  by  the  following  table : 

Percentage  of  Increase  of  Negro  Population 


Decade 

North 

South 

Decade 

North 

South 

1 790-1800    .     .     . 

24.1 

34-0 

1 850-1 860.     .     . 

20.3 

22.1 

1800-1810    .     .     . 

18.7 

39-2 

1860-1870.     .     . 

[33-3]* 

[8.8]« 

1810-1820    .     .     . 

18.0 

29.5 

1 870-1 880.     .     . 

[36.5]* 

[347]* 

1820-1830    .     .     . 

29.2 

31.6 

1 880-1890.     .     . 

16.2 

135 

I 830-1 840    .     .     . 

38.9 

22.2 

1 890-1900.     .     . 

25.1 

17.2 

1840-1850    .     .     . 

237 

26.8 

1900-1910  .     .     . 

18.3 

10.4 

•  Owing  to  the  great  irregularities  in  the  census  of  1870,  especially  as  it  relates  to  the  Southern 
states,  comparisons  of  this  year  with  those  of  i860  and  iSSo  are  wholly  misleading,  and  in  the  fore- 
going table  the  percentages  for  these  years  are  bracketed. 

iNew  Orleans  Times-Democrat,  March  26,  1914. 


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120       TRADE  UNTONTSAI  AXD  LABOR  PROBLEMS 

It  thus  appears  that  in  every  decade  since  the  Civil  War  the  negro 
popuLition  of  the  North  has  been  growing  faster  than  that  of  the 
South.  This  increase  can  be  accounted  for  in  two  ways  only :  by  an 
excess  of  births  over  deaths  and  by  immigration  from  other  states. 
The  meager  vital  statistics  available  indicate  that  while  the  death 
rate  of  the  negro  in  the  North  is  lower  than  that  of  the  negro  in  the 
South,  the  birth  rate  of  the  Northern  negro  is  also  lower  and  is  just 
barely  sufficient  to  balance  the  death  rate.  The  increase  in  the 
colored  population  of  the  Northern  states  appears  therefore  to  be  due 
almost  wholly  to  immigration.  The  census  fully  substantiates  this 
assumption.  In  1910,  415,533  Northern  negroes  were  Southern  born. 
This  is  nearly  two  fifths  of  the  entire  negro  population  living  in  the 
North.  Forty-seven  per  cent  of  the  negroes  living  in  New  England 
in  1 9 10  and  more  than  50  per  cent  of  those  in  the  Middle  Atlantic 
and  East  North  Central  divisions^  were  born  outside  these  sections. 
In  four  of  the  former  slave  states  (Maryland,  Missouri,  Kentucky, 
and  Tennessee)  there  were  actually  fewer  negroes  in  19 10  than  in 
1900.  These,  it  will  be  noted,  are  border  states,  where  "the  call  of 
the  North"  is  most  likely  to  be  first  heard  and  heeded,  and  whence 
migration  is  easier  and  cheaper  than  it  is  farther  south.  It  is  also 
worthy  of  note  that  every  one  of  the  former  slave  states  except  Ar- 
kansas was  "whiter"  in  1910  than  in  1900.-  Indeed,  if  we  exclude 
from  our  reckoning  states  having  a  negro  population  of  less  than 
2  per  cent,  the  only  states  in  the  Union  that  became  perceptibly 
"blacker"  in  the  last  census  decade  were  West  Virginia,  whose  per- 
centage increased  from  4.5  to  5.3,  and  Oklahoma,  whose  increase  was 
from  7  to  8.3  per  cent.  The  increase  in  these  states,  however,  is  not 
large  enough  to  give  rise  to  problems  like  those  in  some  sections  of 
the  old  South. 

It  is  interesting  to  note  that  the  New  England  states,  before  19 10, 
were  not  appreciably  affected  by  the  Northern  migration.  In  three  of 
these  states  (Connecticut,  Rhode  Island,  and  New  Hampshire)  the 
percentage  of  negro  population  between   1880  and   19 10  actually 

'The  Middle  Atlantic  and  East  North  Central  divisions  comprise  the  states  of 
New  York,  New  Jersey,  Pennsylvania,  Ohio,  Indiana,  Illinois,  Michigan,  and 
Wisconsin. 

2  While  the  percentage  of  negro  population  in  Arkansas  increased,  it  was  only 
to  the  extent  of  one  tenth  of  one  per  cent. 


INTERSTATE  MIGRATION  OF  NEGROES 


121 


declined,  in  Maine  it  remained  stationary,  and  in  Vermont  and 
Massachusetts  it  showed  a  very  slight  increase.  New  Hampshire 
actually  contained  fewer  negroes  in  1910  than  in  1790. 

Another  ver\'  interesting  feature  of  the  movement  of  negroes  in 
the  United  States  is  the  fact  that,  in  spite  of  the  northward  tendencies 
just  described,  the  center  of  negro  population  has  been  shifting 
steadily  southward  and  westward.  Since  1 790  the  center  has  changed 
from  southern  Virginia  to  northeastern  Alabama.  This  is  due  to  the 
fact  that  the  drift  of  negro  population  to  the  North  before  19 10  was 
most  pronounced  in  the  border  states  of  Tennessee,  Kentucky,  IMary- 
land,  and  Missouri,  and  that  the  increase  in  the  states  farther  south 
more  than  offset  the  losses  in  these  four  states. 

The  negro  shows  a  tendency  not  only  to  move  northward  but  also 
to  move  about  very  freely  within  the  South.  In  fact,  the  region 
registering  the  largest  net  gain  of  negroes  in  19 10  from  this  interstate 
movement  was  the  West  South  Central  division  (Arkansas,  Louisiana, 
Oklahoma,  and  Texas),  which  showed  a  gain  from  this  source  of 
194,658.  The  Middle  Atlantic  division  came  second  with  a  gain  of 
186,384,  and  the  East  North  Central  third  with  a  gain  of  119,649. 
On  the  other  hand,  the  South  Atlantic  states  showed  a  loss  of  392,827, 
and  the  East  South  Central  states  a  los^  of  200,876  from  interstate 
migration.  While  the  negroes  have  shown  this  marked  inclination 
toward  interstate  movement,  they  nevertheless  exhibit  this  tendency 
in  less  degree  than  do  the  whites.  In  19 10, 16.6  per  cent  of  the  negroes 
had  moved  to  some  other  state  than  that  in  which  they  were  born, 
while  the  percentage  for  the  whites  was  22.4.  For  the  relative  extent 
of  intrastate  migration  by  the  two  races,  figures  are  of  course 
unavailable. 

As  has  already  been  indicated,  the  cause  of  the  migration,  like 
that  of  practically  all  great  movements  of  peoples,  is  fundamentally 
economic.  But  this  simple  statement  does  not  tell  the  whole  story. 
The  causes  may  be  grouped  as  beckoning  and  driving,  the  first  group 
arising  from  conditions  in  the  North  and  the  second  from  conditions 
in  the  South.  Among  the  beckoning  causes  in  19 16-19 17  were  high 
wages,  little  or  no  unemployment,  a  shorter  working  day  than  on 
the  farm,  less  political  and  social  discrimination  than  in  the  South, 
better  educational  facilities,  and  the  lure  of  the  city.  Among  the 
driving  causes  were  the  relatively  low  wages  paid  farm  labor,  an 


I 


It 


4; 


122       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

unsatisfactory  tenant  or  crop-sharing  system,  the  boll  weevil,  the  crop 
failures  of  191 6,  lynching,  disfranchisement,  segregation,  poor  schools, 
and  the  monotony,  isolation,  and  drudgery  of  farm  life.  There  is  a 
noticeable  tendency  on  the  part  of  some  negro  leaders  to  attribute  the 
movement  chiefly  to  the  unrest  due  to  mob  violence  and  other  ills, 
social  and  political,  that  fall  to  the  lot  of  the  black  man.  When  we 
note,  however,  that  lynching  for  the  past  twenty-five  years  has  been 
slowly  but  surely  decreasing  and  that  disfranchisement  is  no  new 
thing,  but  has  been  an  accomplished  fact  for  more  than  forty  years, 
it  becomes  evident  that,  whatever  grievances  of  this  nature  the  negro 
may  have  against  the  South,  he  has  at  least  no  Jtew  complaint  and 
therefore  no  stronger  reason  for  migrating  on  this  account  in  19 17 
than  he  has  had  for  several  decades.  If  adverse  social  and  political 
conditions  are  the  main  cause  of  the  Northern  migration,  it  is  asked, 
why  did  the  negro  not  go  in  the  eighties  and  nineties  when  lynchings 
were  four  times  as  frequent  as  they  now  are  and  when  disfranchise- 
ment was  effected  by  "bulldozing"  and  tissue  ballots  rather  than  by 
the  more  peaceful  method  of  constitutional  amendment  ?  The  answer 
to  this  question  is  that  the  negro  has  no  greater  grievances  now  than 
formerly,  but  that  he  has  a  much  better  opportunity  for  escaping 
these  grievances  than  he  has  had  heretofore.  The  driving  causes  in 
the  South  are  not  of  themselves  sufficient  to  bring  about  such  an 
exodus  as  was  recently  observed.  There  must  be  an  avenue  of  escape 
to  apparently  better  conditions,  and  this  was  presented  when  the 
European  war  created  a  vacuum  in  the  Northern  labor  market. 

The  effects  of  this  interstate  migration,  like  the  effects  of  late 
foreign  immigration,  are  largely  matters  of  the  future.  But  certain 
postulates  with  regard  to  the  immediate  effects  may  be  readily  formu- 
lated. So  far  as  the  migrations  tend  to  bring  about  an  equilibration 
of  demand  and  supply  in  the  labor  markets  of  this  country,  the  effect 
will  be  beneficial.  The  abundance  of  crude,  cheap,  and  easily  man- 
aged labor  in  the  cotton  belt  has  not  been  an  unmixed  blessing.  It  is 
a  well-established  fact,  too,  that  the  negro  does  better  in  those  dis- 
tricts where  he  is  greatly  outnumbered  by  the  whites  than  he  does  in 
the  black  belts  where  he  has  little  chance  to  study  and  emulate  the 
white  man's  skill,  thrift,  and  energy.  The  negroes  who  go  North 
may  thus  increase  their  own  productive  capacity  and,  at  the  same 
time,  by  relieving  somewhat  the  congestion  of  black  folk  in  their  old 


INTERSTATE  MIGRATION  OF  NEGROES 


123 


homes,  may  improve  the  economic  status  of  their  neighbors  who  re- 
main behind.  A  migration  of  negroes  in  any  number  is  likely  also 
to  affect  the  attitude  of  the  Southern  employer  of  colored  labor.  It 
will  tend  to  impress  him  with  the  idea  of  the  black  man's  economic 
value  as  he  had  not  been  impressed  before.  The  exodus  of  1879 
effected  such  a  change  of  attitude  on  the  part  of  the  Mississippi  River 
planters.  A  large  number  of  them  assembled  in  Vicksburg  on  May  5, 
1879,  and  solemnly  resolved  "  that  the  colored  race  has  been  placed  by 
the  Constitution  of  the  United  States,  and  the  states  here  represented, 
on  a  plane  of  absolute  legal  equality  with  the  white  race,"  and  "  that 
the  colored  race  shall  be  accorded  the  practical  enjoyment  of  all  rights, 
civil  and  political,  guaranteed  by  the  said  constitutions  and  laws."^ 

The  migration  has  also  its  debit  side.  As  already  stated,  it  is  a 
cityward  movement  of  a  rural  population,  and  as  such  is  attended 
with  all  the  difficulties  and  dangers  incident  to  such  a  movement  on 
the  part  of  any  people.  But  there  are  additional  difficulties  when 
the  newcomers  to  a  city — even  a  Northern  city — chance  to  be 
colored.  They  must  live  in  the  least  desirable  part  of  the  town,  on 
filthy  and  neglected  streets,  and  in  poorly  constructed,  insanitary 
dwellings,  for  which  they  must  frequently  pay  exorbitant  rentals. 
There  may  be  the  additional  handicap  of  industrial  discrimination 
on  account  of  race. 

Dr.  W.  H.  Crogman,  of  Clark  University,  Atlanta,  Georgia,  a 
well-known  negro  educator,  twenty  years  ago  set  forth  the  evils  of 
this  movement  in  the  following  words : 

Nothing  was  ever  clearer  to  my  mind  than  that  this  interstate 
migration  has  in  it  the  seeds  of  moral  death.  It  is  a  very  Pandora's 
box.  It  strikes  at  the  roots  of  those  things  by  which  only  any  people 
can  hope  to  rise.  It  destroys  the  home  wherever  it  is  established,  and 
prevents  its  establishment  where  it  is  not.  It  retards  the  progress  of 
education  and  acts  like  a  withering  blight  upon  the  influence  of  the 
churches.  .  .  .  Over  and  over  again  have  I  known  persons  to  leave 
their  native  state  and  after  wandering  through  several  others  to 
return  finally  to  the  very  spot  whence  they  had  started,  having  in 
that  time  gained  nothing,  acquired  nothing,  except  that  which  is  -a 
property  common  to  all  bodies  once  set  in  motion — a  tendency  to 
keep  moving.^ 

^Vicksburg  Daily  Commercial,  May  6,  1879. 
2  Talks  for  the  times,  pp.  253-254. 


,1 


uyi 
■VII' 


I  I 


124       TRADE  UNIONISxM  AND  LABOR  PROBLEMS 

Ihis  statement,  in  the  light  of  later  developments,  appears  unduly 
pessimistic,  and  would  probably  be  modified  by  its  author  today  ; 
but  the  fact  cannot  be  gainsaid  that  the  mere  removal  of  the  negro 
to  another  environment  is  not  the  ultimate  solution  of  what  we  call 
the  ''race  problem";  at  the  most  it  can  only  modify  the  problem. 
As  the  European  peasant  does  not  escape  all  his  economic  ills  when 
he  stands  for  the  first  time  under  the  Stars  and  Stripes,  so  the  negro 
will  still  have  his  troubles  after  crossing  the  Mason  and  Dixon  line 


Louisiana  State  University 


William  O.  Scroggs 


X 


A   CLEARING   HOUSE   FOR   LABOR' 


WE  LACK  labor.  The  railroads  are  crippled  for  want  of  it.  The 
farmers  hesitate  to  plant  seed  for  fear  they  cannot  get  labor 
for  the  harvest.  Factories,  public  utilities,  ammunition  factories, 
shipyards,  send  up  a  cry  for  men.  Strangely  enough,  tens  of  thousands 
of  men  walk  the  streets  of  our  cities  in  idleness  in  the  midst  of  the 
labor  shortage.  Appeals  to  patriotism  apparently  go  unheeded.  High 
wages,  instead  of  attracting  them  into  steady  employment,  lead  only 
to  more  frequent  periods  of  idleness.  They  profiteer  in  the  nation's 
day  of  stress  as  willingly  as  many  of  their  employers.  Neither  im- 
pairment of  our  military  efficiency  nor  the  sufferings  of  millions  who 
lack  the  necessities  of  life  move  them.  What  is  the  explanation? 
Why  this  anomaly?  Why  a  labor  surplus  in  the  face  of  a  labor 
shortage  ? 

An  explanation  which  at  least  points  to  one  important  cause  of 
the  phenomenon  is  this :  labor  is  standing  idle  during  a  labor  short- 
age because  an  unorganized  labor  market  has  impaired  the  efficiency 
and  morale  of  hundreds  of  thousands  of  workers.  Men  have  become 
accustomed  to  idleness,  unaccustomed  to  sustained  efforts.  Irregu- 
larity of  employment,  migration  from  industry  to  industry,  the 
cheap  lodging-house,  the  saloon,  pawnshop,  brothel,  municipal  police 
court,  and  lack  of  continuing  responsibilities  have  done  their  deadly 
work.  Men  who  started  out  with  ambition  and  promise  have  degen- 
erated into  inefficient,  irresponsible,  migrator\'  laborers— tens  of 
thousands  of  them  into  almost  unemployable  "bums." 

Labor  is  not  scarce  in  America  so  far  as  quantity  is  concerned.  I 
question  the  probability  of  any  quantitative  shortage  of  labor  dur- 
ing the  war.  If  such  shortages  should  occur,  potential  supplies 
of  female  and  minor  labor  will  fill  up  the  gap.    But  labor  of  quality 

^Atlantic  Monthly,  Vol.  CXXI  (1918),  pp.  773-783. 

125 


Ki'' 


lijji 


It 


126       TRADE  UNIONISIVI  AND  LABOR  PROBLEMS 

is  scarce  in  every  manual  occupation— in  agriculture,  mining,  fores- 
try,  manufactures,  transportation;  and' there  is  no  reservoir  from 
which  that  quality  shortage  can  be  relieved.  Our  hope  for  relief  rests 
solely  in  such  mobilization  as  will  place  the  existing  skilled  labor 
where  it  will  do  the  most  good,  in  subdivision  and  specialization  of 
tasks  so  that  partly  skilled  persons  may  be  able  to  perform  them,  and 
in  intensive  training  of  promising  young  workers  for  such  work  as 
they  can  be  prepared  for  during  the  emergency. 

One  of  the  most  striking  phases  of  the  labor  shortage  is  the  scar- 
city of  good  common  labor.  Anyone  knows  that  an  employer  who 
needs  a  machinist  cannot  use  a  casual  laborer.  It  is  not  difficult  to 
realize  that  a  farmer  who  needs  a  dairyman  cannot  use  a  harvest- 
hand.  But  many  people  do  not  yet  appreciate  the  fact  that  there 
are  different  classes  or  types  of  common  laborers,  just  as  there  are 
different  classes  of  mechanics.  Degrees  of  reliability,  intelligence, 
steadiness,  and  physical  efficiency  are  of  just  as  great  importance 
among  common  laborers  as  degrees  of  skill  among  mechanics ;  and 
the  presence  or  absence  of  these  qualities  means  the  presence  or  ab- 
sence of  ability  to  earn  wages. 

The  shortage  of  competent  American  labor  is  not  simply  a  war 
shortage.  A  considerable  portion  of  our  skilled  labor  supply  has 
always  come  from  Europe,  and  a  relative  decline  in  the  emigration 
of  skilled  laborers  to  America  has  been  the  mainspring  of  our  interest 
in  industrial  education  in  recent  years'.  Everyone  familiar  with  the 
labor  market  has  known  likewise  that  the  Italian  and  Slavic  immi- 
grants from  southeastern  Europe  have  furnished  us  with  our  princi- 
pal supply  of  common  laborers  during  the  past  two  generations,  and 
that  American  common  laborers  have  been,  on  the  whole,  of  declining 
value. 

The  shortage  is  no  new  one.  But  Europe  has  heretofore  protected 
us  against  the  pressure  of  our  lack.  The  war,  with  its  stoppage  of 
immigration,  contemporaneous  with  a  sharp  increase  in  the  demand 
for  American  products,  raw  and  manufactured,  suddenly  made  the 
shortage  acute.  It  twisted  the  tourniquet.  We  suddenly  became 
conscious  that  we  were  no  more  independent  of  Europe's  birth  rate 
than  we  were  of  her  dyes.  We  need  labor  now.  After  the  war,  when 
millions  of  Europeans  will  have  died  in  arms  or  been  crippled  in 
action,  will  immigration  relieve  our  shortage  again  ?    If  it  would,  is 


A  CLEARING  HOUSE  FOR  LABOR 


127 


it  sane  public  policy  to  permit  conditions  to  continue  which  destroy 
the  efficiency  of  hundreds  of  thousands  of  men,  simply  because  we 
can  find  others  to  take  their  places?  Will  a  nation  that  is  willing, 
if  necessary,  to  lay  down  the  lives  of  millions  of  men  and  billions  of 
treasure  to  ''make  the  world  safe  for  democracy"  allow  social  ar- 
rangements to  continue  which  condemn  whole  armies  of  men  to 
economic  inefficiency  and  moral  deterioration? 

One  of  the  principal  reasons  why  uncounted  thousands  of  American 
laborers  are  of  such  low  quality  that  employers  do  not  "want  to 
give  them  standing  room,"  and  prefer  the  immigrants,  is  a  disor- 
ganized labor  market.    Erroneous  labor  policies  stimulate  labor  turn- 
over and  labor  migration  and  result  in  a  progressive  deterioration  of 
the  laborer.    We  educate  them  for  inefficiency  instead  of  efficiency, 
and  train  them  in  shifting  instead  of  in  sticking ;  we  discourage  self- 
respect,  encourage  thriftlcssness,  and  compel  continuous  movement. 
If  we  had  set  ourselves  to  devise  ways  and  means  of  destroying  the 
efficiency  of  American  labor,  we  could  not  have  chosen  methods  better 
suited  to  our  purpose  than  \hi  conditions  characterizing  our  present 
labor  market.    Constant  labor  turnover  and  constant  labor  migration 
will  demoralize  a  working  force  as  rapidly  as  it  can  be  accomplished. 
I  am  not  ignorant  of  the  fact  that  many  personal  causes  contribute 
heavily  to  labor  inefficiency.   No  man  can  watch  the  flow  of  migra- 
tory labor  through  any  distributing  point,  like  Minneapolis,  without 
witnessing  tragedies  of  drink,  of  drugs,  of  feeble-mlndedness,  of  bad 
home  training,  of  defective  education,  and  of  moral   failure  that 
wring  his  heart.    But  contact  with  tens  of  thousands  of  laborers  of 
every  type  and  description  has  forced  the  conclusion  upon  me  that 
the  moral  failure  of  a  very  large  percentage  of  these  men  is  the 
result  of  the  industrial  and  social  conditions  that  surround  them 
rather  than  of  initial  viciousness  on  their  part.    Initial  personal  fault 
accounts  for  some  of  them.    But  economic  conditions  beyond  their 
control  or  understanding  account  for  more.    They  are  victims  of 
drink,  vice,  drugs,  and  women  largely  because  the  nature  of  their 
work  prevents  a  normal  home  life,  normal  community  life,  normal 

citizenship. 

You  are  familiar  with  common  laborers.  You  see  them  daily, 
standing  on  street  corners,  riding  in  street  cars,  sweating  in  excava- 
tions, loafing  at  saloon  or  pool-room  doors.   You  have  probably 


i 


r; 


128       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

hired  them  at  one  time  or  another.  You  may  have  shared  their  life. 
But  have  you  ever  really  become  acquainted  with  them?  Do  you 
know  where  the  common  laborer  comes  from,  what  his  experiences 
are,  what  becomes  of  him,  what  his  types  are?  Or  is  he  one  of 
those  commonplace  experiences  that  you  are  so  familiar  with  that  you 
do  not  really  know  anything  about  him  ?  You  know  that  there  are 
more  than  a  dozen  different  kinds  of  machinists,  and  that  different 
kinds  of  carpenters  have  different  types  of  skill  which  bring  varying 
rates  of  pay.  Do  you  realize  also  that  there  are  at  least  five  distinct 
classes  of  common  laborers,  varying  in  skill,  in  the  kinds  of  work 
they  follow,  in  productive  capacity,  in  earning  power,  in  social 
significance? 

II 

I  was  in  a  gas-retort  house  one  night  in  Oshkosh,  Wisconsin.  It 
was  the  hour  for  drawing  the  coke  and  recharging  the  retorts.  Three 
stokers  opened  the  little  retort  doors  and  drew  the  red-hot  coke 
out  on  the  floor.  Then,  standing  twelve  or  fifteen  feet  away  from  the 
red-hot  open  retorts  they  threw  from  400  to  600  pounds  of  coal,  with 
scoop  shovels,  into  openings  twenty-one  inches  wide  and  fourteen 
inches  high  and  filled  nine  retorts  without  letting  a  single  piece  of 
coal  fall  on  the  floor.  They  were  common  laborers.  They  worked 
twelve  hours  a  day  and  seven  days  a  week.  Their  job  consisted 
simply  in  drawing  coke,  cleaning  retorts,  and  shoveling  coal  into 
the  retorts.  But  they  had  the  skill  of  men  who  had  thoroughly 
learned  a  job,  who  had  developed  an  expert  skill  in  that  job,  who 
remained  steadily  on  the  job.  They  were  a  part  of  that  plant.  But 
more  than  that,  they  were  heads  of  families,  citizens  of  Oshkosh, 
integral  parts  of  the  economic,  political,  and  social  life  of  the  nation. 

Here  is  the  first  and  highest  type  of  the  common  laborer :  the 
man  who  is  a  part  of  an  industry,  who  has  an  occupation,  who  is  a 
citizen  in  a  community,  is  the  father  of  a  family,  perhaps  a  member 
of  a  lodge,  a  club,  or  a  church.  You  find  this  man  by  the  million  in 
our  industrial  and  social  life.  He  runs  the  bulk  of  our  simpler 
machinery,  operates  our  street  cars,  furnishes  our  watchmen,  janitors, 
and  a  thousand  other  kinds  of  steady  help.  Upon  his  shoulders 
rests  a  heavy  portion  of  our  social  fabric.  He  represents  no  social 
problem  so  long  as  he  can  maintain  this  status  —  except  the  problem 


A  CLEARING  HOUSE  FOR  LABOR 


129 


of  an  income  inadequate  to  provide  his  family  with  a  safe  subsist- 
ence and  a  dependable  future.  Probably  four  out  of  every  ten 
workmen  are  found  in  this  category. 

But  this  is  not  the  only  type  of  common  laborer  who  is  a  per- 
manent factor  in  the  life  of  the  community.  A  second  important  type 
is  the  man  who  works  irregularly,  who  has  a  continuous  succession 
of  employers.  He  works  for  a  while  for  contractor  Jones,  then  for 
Smith,  then  for  Brown.  He  gets  a  temporary  job  in  a  factory,  then 
in  a  brickyard,  and  next  in  an  excavation.  At  his  best  he  is  a  man 
with  a  family — struggling  for  existence.  His  wife  commonly  assists 
in  the  bitter  struggle  by  keeping  boarders,  or  by  doing  washing  or 
sewing;  his  children  are  found  at  the  workbench  as  early  as  the 
law  allows,  and  high-school  education  is  not  a  thing  that  his  family 
can  think  about.  In  a  somewhat  lower  variation  of  the  type  we  find 
this  family  intermittently  on  the  rolls  of  the  charities,  whenever  two 
or  three  weeks  of  continuous  unemployment,  a  sickness,  or  other 
slight  calamity  assails  them.  In  a  third  variation  we  find  a  single 
man  living  in  cheap  boarding  houses  and  generally  deteriorating 
steadily  under  the  influence  of  drink  and  irregular  habits.  The 
struggle  for  existence  of  the  married  man  of  this  last  class  is  harder, 
more  bitter — but  he  has  more  to  fight  for. 

The  distinction  between  this  general  group  of  laborers  and  the  one 
first  described  is  found  in  the  relative  steadiness  of  the  first  group's 
employment  and  the  relative  unsteadiness  of  the  second's.  One  works 
for  the  same  employer  for  considerable  periods  of  time ;  the  other 
changes  employers  frequently.  Individuals  of  the  first  group  frequently 
pass  into  the  second  group,  when  they  lose  their  steady  jobs  and  are 
unable  to  get  others.  Individuals  of  the  second  group  sometimes  pass 
into  the  first  group  by  fortunately  dropping  into  a  steady  job. 

To  some  this  may  seem  a  flimsy  basis  for  classification.  It  seems 
somewhat  vague,  leaving  a  middle  ground,  a  twilight  zone,  where  a 
considerable  number  of  people  lie  in  either  group,  or  both,  or  some- 
times in  one  and  sometimes  in  the  other.  But  it  at  least  has  the 
merit  of  conforming  to  life,  and  it  calls  attention  to  two  types  whose 
life  experiences  differ  considerably.  The  members  of  the  group  with 
steady  employment  are  never  far  from  destitution.  They  are  poor, 
very  poor.  They  have  a  hard  time  to  make  ends  meet.  They  com- 
monly have  to  take  their  children  out  of  school  by  the  time  that  they 


If 


130       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

are  sixteen  years  of  age.  A  period  of  unemployment,  a  bad  sickness, 
or  other  misfortune  will  quickly  bring  them  to  the  point  where  they 
must  have  help.  But  ordinarily  they  are  making  ends  meet.  The 
wife  or  children  may  have  to  earn  part  of  the  living,  but  the  family 
is  self-supporting,  and  as  it  looks  ahead  it  sees  a  prospect  of  steady 
income  and  of  continuing  self-support.  It  has  a  certain  sense  of 
assurance,  of  confidence,  of  hope. 

The  group  which  works  at  a  succession  of  jobs,  on  the  contrary, 
continually  hears  the  wolf's  claws  scratching  on  the  door.  They 
live  in  constant  uncertainty,  constant  fear.  They  have  no  assur- 
ance of  continuing  income,  no  solid  basis  for  hope,  no  opportu- 
nity to  get  a  few  dollars  in  the  bank,  no  justification  in  starting  to 
buy  a  home.  They  are  living  from  hand  to  mouth,  and  never  know 
at  what  moment  the  hand  may  be  empty.  Their  self-respect  and 
honesty  are  alwa\'S  under  the  strain  of  fear ;  their  working  efficiency 
is  deteriorated  by  a  continual  change  of  jobs  that  makes  it  im- 
possible for  them  ever  to  attain  efficiency  at  any.  They  are,  by 
force  of  necessity,  jacks  of  all  trades  and  masters  of  none,  and  after 
they  pass  thirty-five  and  their  strength  begins  to  wane,  the  effects 
of  undernourishment  and  the  declining  courage  that  accompanies  a 
life  of  fear  all  bring  a  steadily  declining  efficiency. 

The  "professional  casual"  is  a  third  distinct  type  of  resident  la- 
borer. He  is  a  distinctly  lower  type  than  either  of  the  others,  but 
recruited  from  their  ranks.  Every  employment  office  is  familiar  with 
this  type.  Any  city  with  three  hundred  thousand  people  will  have 
perhaps  three  or  four  hundred  well-known  individuals.  Some  of 
them  are  steady  patrons  of  the  state  or  municipal  offices,  some  of  the 
Salvation  Army,  some  of  the  charities.  Others  hang  around  saloons, 
hotels,  settlement  houses.  Individuals  of  the  type  can  be  found  in 
almost  every  country  town  and  rural  community.  They  are  a 
distinct  social  group. 

At  some  times,  especially  in  the  winter,  the  employment  office  finds 
among  them  laborers  and  mechanics  who  ordinarily  work  steadily 
but  who  are  temporarily  unable  to  get  work  and  are  taking  odd  jobs  to 
carry  them  along.  For  instance,  our  office  carried  a  machine  oper- 
ator with  a  wife  and  family  for  about  four  months  at  odd  jobs,  until 
he  was  able  to  get  a  steady  job.  He  has  now  been  working  steadily 
ever  since  last  September  in  a  machine  shop.    But  these  are  not 


A  CLEARING  HOUSE  FOR  LABOR 


131 


casual  workers.  They  do  not  belong  to  the  type.  They  are  doing 
casual  work  only  temporarily,  and  they  neither  live  the  life,  nor  think 
the  thoughts,  nor  have  the  point  of  view  of  the  true  casual. 

The  casual  never  seeks  more  than  a  day's  work.  He  lives  strictly 
to  the  rule,  one  day  at  a  time.  If  you  ask  him  why  he  does  not  take 
a  steady  job,  he  will  tell  you  that  he  would  like  to,  but  that  he  hasn't 
money  enough  to  enable  him  to  live  until  pay  day,  and  no  one  will 
give  him  credit.  If  you  offer  to  advance  his  board  until  pay  day,  he 
will  accept  your  offer  and  accept  the  job  you  offer  him,  but  he  will 
not  show  up  on  the  job,  or  else  will  quit  at  the  end  of  the  first  day. 
He  has  acquired  a  standard  or  scale  of  work  and  life  that  makes  it 
almost  impossible  for  him  to  restore  himself  to  steady  employment. 
He  lacks  the  will  power,  self-control,  ambition,  and  habits  of  in- 
dustry which  are  essential  to  it. 

The  causes  which  produce  the  casual  are  many.  A  striking  number 
of  them  are  young.  In  general,  these  seem  to  be  defective — de- 
fective in  those  mental  traits  which  are  the  basis  of  industry  and 
ambition,  and  in  the  sense  of  responsibility  ;  defective  in  moral  stam- 
ina or  training  and  addicted  to  drugs,  drink,  and  vice ;  or  defective 
physically  and  unable  to  do  steady,  hard  work.  Absence  of  the  moral 
ideas  and  motives  which  cause  most  of  us  to  work  is  probably  more 
important  in  explaining  these  younger  casuals  than  any  other  one  ex- 
planation. Some  of  them  have  families  which  they  make  little  or 
no  effort  to  support,  never  working  if  they  can  get  someone  else  to 
feed  them.  Others  do  not  know  in  the  morning  where  they  will  lay 
their  head  at  night.  They  live  permanently  in  the  city,  but  have  nu 
residence.    Some  of  them  are  moral  failures,  some  defectives. 

When  we  turn  to  the  group  of  casuals  who  are  older,  their  explana- 
tion is  even  more  complex.  Many  are  moral  failures,  mental  de- 
fectives, or  physical  unfits,  as  already  described.  Others  are  the 
residuum  of  our  labor  market.  Starting  out  as  common  laborers 
twenty  years  before,  they  were  for  a  time  steady  workmen;  then 
they  became  subject  to  irregular  employment,  either  because  of  in- 
dustrial conditions  or  because  of  drink  or  a  taste  for  traveling. 
Gradually  they  became  more  and  more  irregular  in  their  working  and 
life  habits  and  crystallized  into  casuals  living  from  day  to  day  and 
hand  to  mouth,  without  self-respect  or  ambition.  They  are  almost 
parasites  in  the  body  politic. 


II: 


Uf 


u^ 


132       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Not  all  common  laborers  are  residents  of  a  community,  however. 
Intermingling  with  the  resident  laborers  we  find  a  multitude  of  men 
who  are  continually  wandering  from  place  to  place — today  working 
in  a  factory  in  Minneapolis;  a  month  from  now  on  a  construction 
job  in  Des  Moines ;  later,  bobbing  up  on  a  dam  job  in  Wisconsin ; 
migrating  to  the  harvest  fields  in  the  fall,  and  then  to  the  woods,  to 
construction  work,  or  to  some  factory  job  for  the  winter.  These  men 
too  reveal  distinct  subgroupings.  We  find  among  them  temporary 
migrants,  skilled  migrants,  common  laborers,  and  tramps. 

The  temporary  migrant  is  found  particularly  in  agriculture  and 
contracting.  Many  farmers,  farm  hands,  and  city  men,  who  are 
permanent  residents  of  some  community  for  the  bulk  of  the  year,  go 
to  the  harvest  fields  in  the  fall.  Many  carpenters,  painters,  and  other 
classes  of  mechanics  or  steady  laborers  leave  town  during  periods 
when  local  employment  is  slack  and  good  opportunities  are  presented 
elsewhere.  This  is  particularly  noticeable  now,  when  so  many  are 
leaving  their  permanent  homes  to  work  for  the  government  in  other 
localities.  But  most  of  these  men  will  either  return  to  the  towns 
from  which  they  start  or  else  take  up  a  permanent  abode  in  some 
other  locality.    They  do  not  spend  their  life  in  travel. 

The  true  migrant — the  Ishmaelite  of  modern  times — has  no 
abode.  He  lives  where  he  happens  to  be.  If  he  gives  you  a  so-called 
permanent  address,  it  is  the  place  he  left  years  ago,  never  to  return, 
or  else  it  is  fictitious.  This  type  of  migrant  reveals  two  distinct 
classes  —  the  skilled  migrant  and  the  unskilled. 

We  find  the  skilled  man  in  such  types  as  tile  ditchers,  cant-hook 
men,  farm  hands,  and  steam-shovel  engineers.  Side  by  side  with  them 
are  common  laborers  who  work  on  construction  of  dams,  railroads, 
bridges,  in  the  lumber  woods  and  harvest  fields,  or  wherever  large 
gangs  of  men  are  assembled  from  distant  places. 

These  men  have  no  homes.  They  have  either  no  families  or  sev- 
eral families.  They  live  in  the  camp  or  the  lodging  house.  Their 
pleasure  is  found  in  the  saloon  and  its  accompaniments,  in  the  pool 
room  or  the  movie,  or  in  the  rough  jokes  of  the  camp.  When  in 
town  they  are  the  prey  of  the  saloon,  the  "  hook  shop,"  the  second- 
hand store,  the  employment  agency,  the  municipal  police  court,  the 
lodging-house  thief,  the  pickpocket.  On  the  job  they  are  ordi- 
narily parts  of  a  gang,  who  are  "hands"  in  the  eyes  of  foremen  and 


A  CLEARING  HOUSE  FOR  LABOR 


133 


employer.  In  camp  their  lot  is  often  little  better.  I  have  known  cases 
where  men  have  worked  a  month  and  have  been  in  debt  to  their 
employer  at  the  end  for  employment  fees,  post-office  fees,  board, 
hospital  fees,  and  transportation. 

When  I  was  a  child  I  was  much  interested  to  learn  that  the  Ara- 
bian Bedouins,  wandering  over  the  desert,  travel  certain  routes  year 
after  year  by  which  they  pass  through  certain  oases  at  certain  times. 
Tens  of  thousands  of  these  camp  workers  follow  a  similar  trail  — 
passing  from  industry  to  industry  and  locality  to  locality  in  a  more 
or  less  regular  path  of  migration.  As  the  seasons  pass  they  move  from 
contracting  to  harvest  to  lumber  woods  to  railroad  work,  and  often 
insist  on  going  to  certain  definite  localities  at  each  season. 

I  am  trying  to  make  clear  that  we  have  in  America  several  hun- 
dred thousand,  probably  more  than  half  a  million  men,  who  have  no 
homes,  who  are  residents  of  no  community,  who  are  parts  of  no 
particular  industry,  whose  contact  with  the  life  of  our  nation  con- 
sists in  contact  with  cheap  lodging  houses,  private  employment 
agencies,  second-hand  stores,  and  pawnshops;  vicious  women,  sa- 
loons, and  municipal  police  courts  ;  industrial  camps,  where  the 
minimum  of  decency  and  cleanliness  is  maintained  ;  the  brake  beams 
of  the  freight  car;  and  a  total  absence  of  any  home,  church,  or 
community  life. 

These  Ishmaelites  of  the  twentieth  century  are  one  of  the  by- 
products of  our  economic  system.  The  exploitation  of  a  continent's 
natural  resources,  the  single-crop  system  of  agriculture,  the  alterna- 
tions of  industry  due  to  the  seasons,  the  fact  that  in  a  new  country 
labor  has  to  be  attracted  to  new  points  in  the  process  of  developing 
new  enterprises,  have  been  the  economic  bases  of  a  labor-distribution 
system  in  which  labor  has  been  shifted  here  and  there  to  meet  the 
demands  and  needs  of  capital  and  land.  We  have  forgotten  that 
while  labor  may  be  a  commodity,  laborers  are  not.  We  have  met  the 
needs  of  industry  without  protecting  the  personalities  of  laborers. 
We  have  developed  our  resources  while  spoiling  citizens.  Hundreds 
of  thousands  of  men  for  whom  no  individual  industries,  no  commu- 
nity, no  particular  group  of  socially  visioned  people  have  felt  them- 
selves responsible  have  been  steadily  deteriorated  and  ruined  by  a 
life  of  migration  and  irresponsibility. 


4 


WTt 


134       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

III 

m 

We  will  now  trace  the  relation  of  the  employment  system  in 
America  to  the  labor  types.  We  are  very  charitable  in  speaking  of 
it  as  a  system,  for  it  is  precisely  the  absence  of  any  system  of  distrib- 
uting labor  which  is  the  outstanding  characteristic  of  the  situation. 
We  have,  in  all  centers  where  laborers  congregate,  commercial 
agencies  which  make  a  business  of  selling  jobs  to  laborers  for  a  fee. 
We  haxe  state  and  municipal  offices  in  nearly  half  of  the  states,  but  in 
most  cases  each  local  office  works  individually  and  without  any  cor- 
relation with  other  public  offices  in  the  same  state.  The  federal 
government  has  had  an  extremely  crude  employment  system  in  the 
post  offices,  and  has  made  a  weak  attempt  at  federal-state  cooperative 
offices  in  the  Immigration  Bureau.  Both  of  these  experiments  were 
failures,  and  the  federal  government  is  now  attempting  to  develop 
a  real  organization  of  the  labor  market  through  the  Department  of 
Labor.  Little  practical  progress  has  been  made,  and  no  genuine 
success  will  be  achieved  until  the  nation  more  fully  recognizes  some 
of  the  fundamental  facts  in  the  situation  with  which  it  is  seeking 
to  cope. 

The  essence  of  our  industrial  policy  with  respect  to  labor  has  been 
continuous  turnover.  In  ever>'  industry,  though  not  in  every  individ- 
ual establishment,  our  employers  have  followed  a  policy  of  hiring 
and  firing.  If  a  man  did  not  happen  to  make  good  at  a  particular 
task,  he  was  discharged  and  someone  else  hired,  instead  of  being 
transferred  to  some  other  task  better  adapted  to  his  qualities.  Fore- 
men have  considered  the  power  of  discharge  as  their  one  unfailing 
method  of  discipline.  Discharge  has  been  in  industry  what  spanking 
used  to  be  in  the  home  and  the  schoolhouse.  In  each  case  it  has 
been  the  means  by  which  those  too  lazy  to  think  of  better  ways  of 
proceeding  have  dealt  with  the  weak  in  their  power.  Excessive 
discharge  in  industry  has  been  as  disastrous  in  its  effects  on  the 
industrial  and  social  efficiency  of  labor  as  excessive  whipping  on  the 
soul  of  a  child.  It  has  weakened  the  worker's  self-respect,  decreased 
his  self-reliance,  and  encouraged  subservience.  The  continual  change 
of  jobs  has  prevented  the  worker  from  ever  learning  any  job  well 
and  has  destroyed  all  interest  in  his  work. 

The  losses  are  equally  disastrous  from  the  employer's  point  of  view. 


A  CLEARING  HOUSE  FOR  LABOR 


135 


It  takes  the  time  of  foremen  and  bookkeepers  to  hire  and  fire,  and 
the  time  of  foremen  to  instruct  the  new  hand  ;  fellow  employees  and 
machinery  are  slowed  down  while  he  learns  his  job,  and  breakage 
and  waste  are  increased.  Millions  of  dollars  are  lost  to  employers 
every  year  by  the  slowing  down  of  their  plants  and  wastage  of  time 
and  materials  caused  by  excessive  labor  turnover. 

There  are  certain  principles  which  I  believe  must  be  recognized 
in  order  to  reduce  the  social  losses  that  I  have  been  pointing  out. 
We  must  have  a  system  of  employment  offices,  national  in  scope  and 
monopolizing  the  whole  employment  business,  which  will  be  so  care- 
fully worked  out  that  every  worker  can  be  placed  in  the  nearest 
job  that  he  is  able  to  fill  and  will  have  access  to  every  job  open  to  a 
particular  capacity.    Our  system  must  be  able  to  keep  every  work- 
man employed  with  the  maximum  steadiness  ;  must  be  able  to  sift 
and  classify  the  laborers,  so  that  individuals  who  have  a  tendency  to 
degenerate  into  casuals  may  be  spotted  and  if  possible  held   to 
steady  employment ;  and  must  be  able  to  sift  out  and  furnish  em- 
ployers with  the  kind  of  men  they  want.   It  must  dovetail  the  indus- 
tries of  each  locality  so  as  to  use  every  man  in  the  locality  as 
steadily  as  possible  in  that  locality.  ^ 

To  accomplish  these  manifold  purposes  we  must  have  a  national 
system  of  employment  offices,  with  branches  in  every  locality  and  a 
central  clearing  house.  Within  this  national  system  must  be  zones, 
or  districts,  with  clearing  houses  for  each  district ;  and  within  the 
districts  must  be  subdistricts  with  their  own  clearing  houses.  If  a 
local  office  in  a  subdistrict  could  not  fill  an  order,  it  would  tele- 
phone the  order  to  its  clearing  house,  which  would  seek  to  obtain  a 
man  from  some  other  local  office  in  the  subdistrict.  If  the  demand 
could  not  be  filled  in  the  subdistrict,  it  would  be  transferred  by  the 
subdistrict  clearing  house  to  the  district  clearing  house,  which  would 
seek  a  man  in  the  district.  Similarly,  if  the  district  could  not  fill 
the  order,  it  would  clear  the  demand  through  the  national  clearing 

house.  ,  .     ,     .  1  1 

This  clearing-house  system,  if  it  were  combined  with  a  monopoly 
of  the  labor  market,  would  enable  the  public  employment  offices  to 
check  labor  migration  by  always  finding  the  nearest  man  who  was 
competent  to  fill  the  position.  We  should  not  then  have  men  eaving 
Chicago  to  fill  jobs  in  St.  Louis  at  the  same  time  that  men  are  leaving 


it 


136      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

St.  Louis  to  fill  the  same  kind  of  jobs  in  Chicago.  The  pressure 
would  be  put  on  men  to  make  them  remain  where  they  are,  instead 
of  to  cause  them  to  move.  Within  a  big  labor  market  like  New 
York  or  Chicago  tens  of  thousands  of  jobs  would  be  filled  annually 
by  local  men  which  are  now  filled  by  outsiders  ;  tens  of  thousands  of 
men  kept  at  home  who  are  now  emigrating  to  other  localities. 

The  effect  which  such  a  system  of  offices  might  have  upon  labor 
turnover  is  even  more  important.  That  portion  of  the  labor  force 
which  is  most  frequently  changing  jobs  would  soon  be  recorded  in 
the  files  of  the  employment  offices.  A  glance  at  a  workman's  card 
would  show  his  history — whether  he  was  a  casual,  an  irregular 
laborer,  or  normally  a  steady  man.  It  would  show  the  kind  of  work 
he  has  followed.  Any  local  office  desiring  further  information  con- 
cerning a  certain  man  could  quickly  get  it  by  telephoning  or  tele- 
graphing other  offices  in  which  he  was  registered.  The  sifting  of 
men  and  their  individual  treatment  would  become  a  practical  possi- 
bility instead  of  a  theoretical  ideal.  The  offices  could  use  pressure 
to  hold  a  man  steady. 

The  record  of  employers  would  be  equally  useful.  Those  plants 
which  revealed  excessive  turnover  could  be  easily  sifted  out,  and 
the  matter  brought  to  the  attention  of  their  managers.  By  personal 
interview,  bulletins,  and  correspondence  the  offices  could  call  to  the 
employers'  attention  the  causes  of  excessive  turnover,  its  cost,  and 
its  treatment.  The  criticism  of  workmen  against  individual  firms 
could  be  brought  to  the  employer  and  the  faults  corrected. 

To  illustrate:  A  certain  firm  in  Minnesota  has  been  employing 
200  or  300  men  in  a  construction  camp  for  about  two  years.  They 
have  a  good  camp,  with  steam  heat,  iron  beds,  good  wash  rooms,  and 
other  conveniences.  The  firm  provides  good  food.  The  foremen  do 
not  drive  the  men.  The  wages  are  high.  Nevertheless  an  excessive 
turnover  of  labor  continued.  The  public  employment  bureau  deter- 
mined to  find  the  cause.  Upon  investigation,  man  after  man  re- 
ported that  the  company  was  providing  good  food,  but  poor  cooks 
were  spoiling  it.  The  company,  for  their  part,  showed  that  they 
were  paying  high  wages  to  their  cooks.  But  they  were  not  getting 
the  service.  Correction  of  the  difficulty  quickly  cut  the  turnover. 
In  two  similar  cases  it  was  found  that  a  brutal  foreman  was  the 
cause  of  frequent  quitting ;  in  another,  wages  had  fallen  below  the 


A  CLEARING  HOUSE  FOR  LABOR 


137 


market  rate.  An  office  in  continuous  touch  with  the  employers  and 
men  of  a  given  labor  market  develops  a  surprisingly  intimate 
knowledge  of  the  conditions  in  the  several  establishments. 

But  most  important  of  all  the  advantages  are  two— that  the 
market  for  labor  would  be  centralized  and  that  those  in  charge  would 
be  interested  in  serving  the  needs  of  the  employer  and  the  employee 
rather  than  in  personal  profit.  Centralization  in  the  labor  market  has 
the  same  advantage  that  centralization  in  any  market  has.  The  buyer 
and  seller  have  the  maximum  opportunity  of  getting  in  contact  with 
someone  with  whom  they  can  do  business.  At  present,  with  a  large 
number  of  unrelated  employment  offices  operating  in  the  same  town, 
—state,  federal,  commercial,  philanthropic,  trade-union,  and  the 
rest,— the  employer  who  wants  a  certain  kind  of  man  frequently 
places  his  order  in  one  office  while  the  employee  who  seeks  that  kind 
of  work  files  his  application  in  another.  The  two  fail  to  meet. 
With  a  single  coordinated  system  of  offices  the  two  will  come  to- 
gether in  every  instance. 

An  employment  system  run  for  profit  will  never  give  either  our 
industries,  our  workers,  or  the  nation  sound  service.    The  profits 
of  the  employment  agent  come  at  so  much  per  head.    The  more 
heads,  the  more  dollars.    The  greater  the  turnover,  the  larger  the 
profits.    The  interests  of  the  employer  demand  a  small  turnover. 
The  interests  of  the  laborer  demand  a  steady  job.    The  interests  of 
the  employment  agent  are  exactly  opposite  ;  the  more  men  he  sends 
out,  the  greater  the  number  of  fees.    Private  agencies  are  daily 
shipping  men  by  the  thousands  who  they  know  will  not  stick.    Fre- 
quently they  know  that  the  man's  real  intention  is  to  jump  the  job 
he  is  sent  to  and  go  to  some  near-by  work.    But  what 's  the  differ- 
ence ?    Large  turnover  means  large  fees,  and  large  fees  are  the  object. 
The  state  and  municipal  offices  as  heretofore  managed  in  this  coun- 
try have  in  most  cases  (not  in  all)  developed  a  similar  motive  favor- 
ing turnover.   In  their  case  it  is  unconscious.   They  measure  their 
efficiency  by  the  cost  per  head  to  the  state  of  the  men  sent  out. 
They  brag  that  it  has  cost  the  state  but  30,  or  25,  or  19  cents  per 
man  sent  out,  as  compared  with  the  $2  fee  collected  from  workmen 
by  the  private  agencies.    Since  most  of  the  state  and  municipal 
agencies  have  a  set  budget,  say  $5000  or  Sio,ooo  per  year,  approxi- 
mately, all  of  which  they  spend,  their  average  cost  is  lowered  m 


lit! 


138      TRADE  UXIOxNISM  AND  LABOR  PROBLEMS 

proportion  to  the  number  of  men  sent  out  while  spending  the  appro- 
priation. The  larger  the  business,  the  smaller  the  average  cost  per 
job  filled,  and  the  better  the  showing.  The  natural  result  is  an 
emphasis  on  the  number  of  men  sent  out  rather  than  on  the  quality 
of  service  rendered.  Instead  of  studying  their  local  market,  to 
develop  policies  that  will  give  the  local  workers  the  maximum  con- 
tinuity of  employment  and  local  employers  the  steadiest  possible 
labor  force,  their  effort  has  been  concentrated  upon  getting  orders 
for  jobs  vacated  and  men  to  fill  them.  They  have  made  no  effective 
effort  to  decrease  labor  turnover,  and  if  they  do,  they  will  impair 
their  showing  before  their  legislative  bodies  by  running  up  a  higher 
per-capita  cost  for  placement.  Cheapness  rather  than  quality  has 
been  the  criterion  thus  far  applied  to  their  service.  And  it  is  the 
criterion  that  will  continue  to  be  applied  until  we  establish  a  com- 
prehensive system  of  employment  offices,  in  charge  of  men  who  under- 
stand the  employment  problem  and  are  technical  experts  in  dealing 
with  it,  and  who  are  independent  of  the  annual  and  biennial  criticism 
of  local  legislative  bodies  not  conversant  with  the  problems  being 
worked  out.  It  is  only  under  such  conditions  that  the  employment 
organization  can  attack  and  solve  the  vital  problem  of  our  labor 
market. 

IV 

I  have  emphasized  two  points  as  fundamental  to  a  successful  or- 
ganization of  the  labor  market :  first,  a  consolidation  of  all  public 
employment  agencies  into  a  single  system  under  the  auspices  of  the 
federal  government,  with  subdistricts  and  clearing  houses  just  as  we 
have  in  the  Federal  Reserve  banking  system ;  and,  second,  a  mo- 
nopoly of  the  labor  market,  so  far  as  employment-agency  work  is 
concerned,  by  this  federal  employment  system.  A  further  word  on 
these  two  points  is  now  necessary. 

The  country  had  no  lack  of  employment  agencies  when  the  war 
broke  out ;  it  has  none  now.  The  only  trouble  is  that  they  are  not 
of  much  use.  The  postmasters  were  acting  as  employment  agents. 
The  Federal  Immigration  Bureau  was  also  running  a  system  of  em- 
ployment offices.  This  is  now  discontinued,  and  a  new  set  of  federal 
offices,  under  an  employment  chief  of  the  Department  of  Labor, 
is  in  process  of  establishment.    More  than  one  half  of  the  states 


A  CLEARING  HOUSE  FOR  LABOR 


139 


had  state  employment  offices.  Many  municipalities  had  employ- 
ment offices.  The  Y.  M.C.A.  and  Y.  W.  C.  A.,  charity  societies, 
commercial  associations,  settlement  houses,  the  Salvation  Army,  and 
other  semipublic  or  charitable  organizations  were  running  a  host  of 
agencies,  more  or  less  defiled  with  the  taint  of  charity.  Thousands 
of  private  profit-getting  agencies  v*^ere  in  operation  in  all  of  the 

labor  centers. 

The  number  of  employment  agencies  in  the  country  ran  into  the 
thousands,  probably  the  ten  thousands.  But  each  was  a  distinct 
unit.  The  postmasters  had  no  effective  system  of  cooperating  with 
each  other  and  made  no  attempt  to  cooperate  with  the  immigration- 
bureau  offices.  The  various  immigration  offices  were  distinctly  local 
and  had  no  system  of  cooperating  with  one  another.  They  had  no 
clearing  houses.  They  were  in  no  effective  cooperation  with  state 
offices  except  in  half  a  dozen  cities.  The  state  offices  of  each  state 
were,  as  a  rule,  run  as  local  offices  and  without  any  centralized 
management  of  the  state  labor  market.  The  philanthropic  agencies 
cooperated  neither  among  themselves  nor  with  the  public  offices. 
Decentralization,  disorganization  was — and  is — the  keynote  of  the 

situation. 

The  first  essential  step  now  is  legislation  that  will  weld  all  of  the 
existing  state  and  municipal  offices  into  a  federal  system,  centralized, 
coordinated,  systematically  managed,  and  controlled  by  big,  far- 
seeing  policies.  The  same  legislation  should  eliminate  forever  the 
private  commercial  agency,  which  has  cursed  our  economic  system 
far  too  long.  Monopoly  is  essential  in  order  to  insure  that  all  orders 
for  men  and  applications  for  work  shall  be  brought  to  the  same  office, 
so  that  buyer  and  seller  may  have  their  needs  met  with  maximum 
rapidity  and  efficiency.  It  is  likewise  essential  to  check  turnover 
and  migration.  Philanthropic  agencies,  operated  without  profit  to 
their  owners,  might  be  permitted  to  continue  if  operated  in  close 
cooperation  with  the  public  system.  But  practically  all  of  them 
would  go  out  of  business  as  soon  as  a  proper  organization  of  the 
market  was  established. 

The  plans  suggested  are  not  theoretical.  England  has  for  years 
been  operating  a  system  of  employment  offices  not  materially  dif- 
ferent from  the  plan  suggested.  Ohio  is  today  operating  a  system 
of  twenty-two  offices  on  similar  principles.    A  clearing  house  for 


f 


Ef 


140       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

public  noncommercial  employment  agencies  is  now  clearing  for 
over  seventy  agencies  in  New  York  City.  Many  able  men  in  this 
country  are  already  sufficiently  experienced  in  employment-office 
management  and  sufficiently  conversant  with  the  problems  to  be 
solved  to  undertake  the  installation  of  an  American  system  that 
will  be  an  ideal  for  the  world. 

The  war  has  revealed  how  acute  is  the  need.  The  time  is  ripe.  An 
aroused  public  should  demand  a  termination  of  the  suicidal  labor 
policies  which  have  been  ruining  the  efficiency  of  American  labor. 


Don  D.  Lescohier 


Unwersity  of  Wisconsin 


•s  t 


PART  III.   LABOR  MANAGEMENT 


XI 

SCIENTIFIC    SHOP    MANAGEMENT  ^ 

MR.  TAYLOR  .  .  .  The  development  of  a  code  of  laws,  of  a 
science  to  replace  the  oldrule-of- thumb  knowledge,— recording 
it  and  reducingirfo-t2rwv=^lslErSHt^  of  scjentific  manage- 

ment.   Second,  the  scientific  "selectionoTthe  workman  and  his  train- 
ingT  Third,  the  bringing  of  the  science  and  the  trained  workman 
together.    And  fourth,  some  scheme,  joint  effort,  to  make  it  worth 
WEiTTfor  the  workmen  to  work  according  to  the  new  .'scheme.    Pig- 
iroh"liandling  is  the  cheapest  form  of  labor  known.  .  .  .    Probably 
the  most  important  element  in  the  science  of  shoveling  is  this: 
There  must  be  some  shovel  load  at  which  a  first-class  shoveler 
will  do  his  biggest  day's  work.    What  is  that  load?     To  illus- 
trate:  Right  back  of  the  office  of  the  Bethlehem  steel  works,  there 
was  a  train  of  rice  coal  being  pushed  in  and  the  right  kind  of 
fellows  at  the  shovels.   No   fellows  could  work  better  than  they 
worked.     But  we  saw  first-class  shovelers  go  from  shoveling  rice 
coal  with  a  load  of  3^4  pounds  to  the  shovel  to  handling  ore  from 
the  Messaba  Range  with   38  pounds  to  the  shovel— 3^4    to   38 
pounds.   Now  it  don't  take  much  science  to  see  that  they  can't  both 
be  right.    Now,  what  is  the  proper  load  for  a  man  to  take  on  a 
shovel  ?    It  was  up  to  us  to  make  a  scientific  investigation  of  shovel- 
ing.   This  lasted  more  than  a  year  of  constant  study  and  work.    In 
making  that  investigation  a  number  of  men  were  busy  at  it  all  the 
time— high-class  men,  men  who  were  very  much  in  earnest.    Here's 
a  sample  of  the  way  to  go  at  it.    There  is  nothing  too  small  for  a 
careful,  thorough  study.  What  we  did  was  to  call  in  two  big,  powerful 
shovelers.    Let  me  point  out,  gentlemen,  some  people  would  say,  why 

iFrom  publication  of  the  Milwaukee  Federation  of  Labor,  1914.  Discussion 
by  Frederick  W.  Taylor  and  N.  P.  Alifas,  representing  Metal  Trades  Depart- 
ment of  the  American  Federation  of  Labor. 

141 


fl 


U 


111 


, 


Wwf 


142       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

didn't  you  pick  out  some  weak  ones  ?    Because  we  have  common 
sense  ;  because  we  propose  to  get  the  right  man  doing  the  right  work. 
Well,  we  called  in  two  powerful  shovelers.    That's  one  of  the  char- 
lacteristics  of  scientific  management.    First-class  men  for  the  job. 
These  men  were  then  talked  to  in  about  this  way :  "  Now,  Pat,  you 
are  going  to  be  asked  to  do  a  whole  lot  of  fool  things.   A  young  fel- 
low is  going  to  write  down  all  of  the  things  you  are  doing.    What  we 
are  after  is  certain  facts.   What  we  want  you  to  do  is  to  work  just 
the  way  you  are  told  to  work.     If  you  do  that, — and  we  know  you 
think  it  will  be  a  disagreeable  thing, — we  are  going  to  pay  you 
double  wages  while  you  are  doing  it.   Whatever  he  says  goes.    He 
looks  like  a  fool,  but  don't  you  get  it  through  your  head  he  is  a  damn 
fool.    You  try  to  soldier  on  him  and  you  will  never  come  back  here 
again.    I  want  each  of  you  fellows  to  work  so  as  to  go  home  properly 
tired  but  not  overstrained.   There  is  going  to  be  no  more  soldiering 
and  you  have  got  to  be  just  as  careful  not  to  do  too  much  as  not  to 
do  too  little.   Why  ?    Because  we  want  our  men  to  do  something  that 
they  can  do  throughout  their  lives  without  hurting  themselves." 
Why  ?    Because  this  whole  scheme  depends  on  getting  the  maximum 
output.    You  have  got  to  do  a  good,  proper  day's  work,  but  there  is 
no  such  thing  as  nigger  driving  under  scientific  management.  .  .  . 
You  put  a  man  to  shovel  a  load  and  give  him  on  his  first  trial  a 
big  shovel,  shoveling  all  day  long.    The  number  of  shovelfuls,  38 
pounds  on  the  shovel,  were  counted.   We  then  cut  the  shovel  off  so 
that  it  held  about  34  pounds.    He  shoveled  more  stuff  with  the  34- 
pound  load.    W^ith  a  3c>-pound  load  he  shoveled  still  more  tons  per 
day.   A  21 -pound  load  was  the  maximum.   With  the  18-pound  load 
he  shoveled  less.    That  is,  the  powerful  workman,  well  suited  to  his 
job,  did  the  biggest  day's  work  with  this  21-pound  shovel.    How  far- 
reaching  is  that  law  ?    Under  the  old  system  every  fellow  owned  his 
own  shovel.    Every  man  went  at  it  each  day  as  he  saw  fit,  and  the 
shovel  was  the  same  size,  whatever  the  kind  of  work.   Now,  as  a 
matter  of  common  sense,  we  saw  at  once  that  it  was  necessary  to  fur- 
nish each  workman  each  day  with  a  shovel  which  would  hold  just 
21  pounds  of  the  particular  material  which  he  was  called  upon  to 
shovel.    That  meant  that  where  a  man  was  handling  great  big  gangs 
before,  now  we  had  to  handle  each  man  by  himself.    Each  man  had 
to  be  studied  as  a  man  and  find  out  what  he  was  fitted  for.   We  had 


SCIENTIFIC  SHOP  MANAGEMENT 


143 


to  study  each  man's  work  every  day.  ...   We  had  to  have  men 
teachers  appointed  to  show  those  men  how  to  shovel  and  how  to  shovel 
right,  to  teach  them  how  to  shovel.  We  had  to  have  men  figure  up  each 
night  just  what  every  man  of  that  gang  did  the  day  before.    The  first 
thing  each  workman  did  when  he  came  into  the  yard  in  the  morning— 
and  I  may  say  that  a  good  many  of  them  could  not  read  or  write— 
was  to  take  two  pieces  of  paper  out  of  his  pigeonhole.    One  of  those 
slips  of  paper  informed  the  man  in  charge  of  the  tool  room  what  im- 
plement the  workman  was  to  use  on  his  first  job  and  also  in  what 
part  of  the  yard  he  was  to  work.   The  second  one  was  a  white  or 
yellow  slip  of  paper.    It  told  what  they  earned  yesterday— how  they 
fell  down.    If  it  was  a  yellow  slip  of  paper  they  knew  they  had  fallen 
down.    If  that  happened  three  or  four  days  they  would  hear  from 
it.    The  old  way  of  treating  a  man  would  be  to  say  to  him,  "  Pat,  you 
are  no  good,  now  get  out  of  this."   Now  let  me  show  you  what  hap- 
pens.   Generally  the  man  was  sent  down  to  him  that  taught  him  how 
to  shovel.    "Here,  Jim,  you  have  got  four  or  five  of  those  yellow 
slips.  Have  you  been  drunk,  or  are  you  sick  ?  Because  if  you  are  sick 
we  will  give  you  a  show  somewhere  else  for  a  while,  while  you  are 
getting  better.    Have  you  forgotten  how  to  shovel  ?    Go  ahead  and 
shovel  and  I  will  see  what's  the  matter  with  you." 

Now  that  teacher  knows  all  about  the  art  of  shoveling,  and  he 

not  only  knows  how  to  shovel  but  he  knows  how  to  show  another 

fellow  how  to  shovel.   Now  he  says  to  that  workman:  "Go  ahead 

and  shovel."   He  finds  almost  every  time  that  the  fellow  forgot  how 

to  shovel.   Now,  gentlemen,  I  dare  say  some  of  you  have  done  some 

shoveling,  but  whether  you  have  or  not,  I  am  going  to  try  to  show 

you  something  about  the  science  of  shoveling.    There  is  a  good  deal 

of  refractory  stuff  to  shovel  around  a  steel  works;   take  ore,  or 

ordinary  bituminous  coal,  for  instance.    It  takes  a  good  deal  of  effort 

to  force  the  shovel  down  into  either  of  these  materials  from  the  top 

of  the  pile,  as  you  have  to  when  you  are  unloading  a  car.  There  is  one 

right  way  of  forcing  the  shovel  into  materials  ot  this  sort  and  many 

wrong  ways.    Now  the  right  way  is  to  press  the   forearm  hard 

against  the  upper  part  of  the  right  leg  just  below  the  thigh,  take  the 

end  of  the  shovel  in  your  right  hand  and  when  you  push  the  shovel 

into  the  pile,  instead  of  using  the  muscular  effort  of  your  arms,  which 

is  tiresome,  throw  the  weight  of  your  body  on  the  shovel.   That 


^^♦■j 


I 


144      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

pushes  your  shovel  in  the  pile  with  hardly  any  exertion  and  without 
tiring  the  arms  in  the  least.    Teaching  a  man  how  to  shovel  requires 
the  same  sort  of  coaching  as  there  is  in  baseball.    Then  there  are 
lots  of  other  elements  in  shoveling,  the  shape  of  the  shovel,  etc. 
Now  the  new  idea  that  comes  under  scientific  management  is  that  if 
that  man  isn't  shoveling  right  it's  our  fault,  because  we  haven't 
taught  him  right.    It's  not  his  fault.    We  don't  go  down  there  blam- 
ing him.    It's  up  to  us.    We  have  failed  somewhere.    The  proba- 
bility is,  it's  the  management's  fault.    All  that  costs  a  whole  lot  of 
money.    The  question  is.  Does  it  pay?    No  scheme  which  doesn't 
pay  for  itself  as  it  goes  along  can  be  worth  anything.    It  won't  persist. 
A  very  proper  question  is.  Does  this  thing  pay  ?    If  it  doesn't  pay,  it 's 
no  good.   At  the  end  of  three  years  we  had  a  good  chance  to  find  out. 
There  were  several  million  tons  of  material  handled  in  the  Bethlehem 
Steel  Company  in  the  course  of  a  year.    Under  the  old  system  it 
cost  between  7  and  8  cents  to  shovel  a  ton.    Now,  after  paying  for 
all  the  clerical  work  which  was  necessary  under  the  new  system, 
for  the  teachers,  for  building  and  running  the  labor  office,  and  then 
paying  the  men  60  per  cent  higher  wages  than  they  got  before,  the 
cost  of  shoveling  a  ton  was  reduced  from  between  7  and  8  cents  under 
the  old  system  to  between  3  and  4  cents  under  the  new  system.    In 
addition  to  that,  the  saving  during  the  last  six  months  of  that  three 
and  one-half  years  was  at  the  rate  of  $78,000  a  year.    And  the 
workmen  there  got  justice,  there  was  friendship  in  place  of  enmity. 
I  had  them  look  up   those  men,  and   they  were  all   happier   and 
better  off.    That  is  the  justification  of  scientific  management.    You 
have  got  to  have  that  every  time,  or  else  scientific  management 
doesn't  exist. 

Mr.  Alifas  ...  In  regard  to  our  objections  to  the  system,  I 
might  start  in  by  telling  you  what  we  consider  its  possibilities.  These 
possibilities  are  the  main  objections  we  have  to  the  system. 

If  it  is  a  fact  that  workmen  are  loafers  as  a  general  thing  unless 
somebody  gets  behind  them  with  a  whip  to  spur  them  on,  and  the 
employer  is  to  blame  for  that,  why  of  course  he  will  take  that  blame 
very  kindly,  due  to  the  fact  that  he  thinks  he  hasn't  got  behind  them 
strong  enough.  There  are  a  great  many  forms  of  stimuli  added  to  the 
stimulus  that  is  ordinarily  used.  As  to  the  machinists,  those  that  are 
organized,  they  don't  favor  any  system  that  gives  them  any  more 


SCIENTIFIC  SHOP  MANAGEMENT 


145 


stimulus  tlian  the  stimulus  that  is  ordinarily  in  vogue  under  day- 
work.  They  find  that  the  fear  of  discharge  and  the  supervision  of 
the  foreman,  and  the  desire  of  the  men  to  retain  the  good  will  of 
their  employers,  are  sufficient  for  all  purposes  to  make  them  do  a 
desirable  day's  work.  .  .  . 

One  of  the  first  stimuli  that  has  been  added  is  the  premium  system. 
And  of  course  it  is  well  recognized  that  if  a  man,  in  addition  to  the 
fear  of  discharge  and  the  fact  that  he  has  to  do  a  good  day's  work, 
is  induced  to  speed  up  by  means  of  being  offered  a  reward,  it  will 
stimulate  his  movement  just  that  much  faster. 

A  great  deal  has  been  said  here  in  regard  to  the  very  unsatisfac- 
tory method  of  getting  prices  finally  set  by  means  of  piecework.  It 
appears  that  the  employer  can't  resist  the  temptation  to  cut  prices  if 
a  man  makes  more  than  he  thinks  he  ought  to  make.  The  inference 
seems  to  be  that  the  employer  loses  that  notion  once  he  tries  scientific 
management.  As  we  look  at  it,  it  resolves  itself  down  to  this :  Piece- 
work is  paid  on  a  basis  that  is  more  like  guesswork.  If  an  em- 
ployer has  found  out  just  what  the  least  time  is  that  a  man  can  do  a 
job  under  the  premium  system  with  a  time-study  method  of  ascer- 
taining the  time,  he  arrives  at  that  time  in  the  first  place,  so  that  he 
doesn't  have  to  reduce  the  man  in  order  to  get  him  down  to  the  very 
highest  speed  and  lowest  wages.  An  employee  under  piecework 
would  at  least  be  having  the  advantage  of  not  having  to  work  quite 
so  hard  and  getting  better  wages  while  the  cutting  was  going  on. 
Of  course,  if  they  continued  piecework  long  enough,  they  would 
eventually  get  down  to  the  basis  where  an  employee  could  just  about 
make  what  the  employer  thinks  he  ought  to  make. 

It  is  advocated  that  once  the  system  gets  started,  they  should 
add  another  stimulus  to  the  premium.  That  is,  they  would  start  a 
system — thfr^differenti^  piecework  system,  that  consists  of  ascer- 
taining what  the  maximum  amount  of  work  a  man  can  do  in  a  day  is, 
and  when  they  find  that,  then  offer  him  a  piece  price  in  addition  to 
a  bonus.  An  illustration  has  been  given :  Say  a  man  could  make  ten 
pieces  in  a  day.  He  would  get  35  cents  a  piece  for  those.  If  he 
makes  nine  and  three-fourths  in  a  day,  he  would  get  only  25  cents 
a  piece  for  them.  That  would  furnish  a  man  with  a  powerful  in- 
centive to  speed  up  abnormally.  That  is  an  incentive  that  is  much 
higher  than  even  the  premium  system  or  the  piecework  system.   It 


I 


5  it 
4i*l 


^h| 
P^ 


146       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

would  be  clear  to  you  just  why  the  premium  system  is  a  system  that 
contains  more  stimulus  than  the  piecework  system.  Under  the 
premium  system,  as  it  is  in  vogue  at  the  Watertown  arsenal,  if  it  has 
been  discovered,  say,  that  the  least  possible  time  in  which  a  job  of 
one  hundred  pieces  could  be  done  is  forty  minutes,  they  add  40  per 
cent  to  that  and  say  if  a  man  can  do  that  inside  of  an  hour  he  shall 
get  paid,  say,  one  half  a  cent  or  half  of  his  rate  for  every  minute  that 
he  saves  under  that.  He  would  be  getting  40  cents  for  doing  that 
hundred  pieces  instead  of  30  cents.  The  faster  he  does  the  job,  the 
more  money  he  gets  for  the  job. 

Now  another  stimulus  that  they  propose  is  that  if  a  foreman  is 
given  a  premium  in  proportion  to  the  number  of  men  under  him 
that  are  making  a  premium,  he  will  have  a  greater  interest  in 
getting  them  to  do  more  work.  Of  course  he  will.  If  a  foreman  is 
going  to  lose  money  every  time  one  of  his  men  fails  to  make  his  pre- 
miums, he  is  going  to  get  after  that  man.  It  isn't  going  to  be  a  ques- 
tion of  investigating  to  learn  just  why  the  man  couldn't  do  a  day's 
work  and  endeavor  by  coaxing  and  persuasion  to  get  him  to  do  it, 
but  by  something  more  forcible  than  that. 

Now  there  is  the  question  of  the  amount  of  premium  that  a  man 
shall  get.  According  to  the  way  this  question  was  explained  by 
Mr.  Taylor  in  his  work,  the  amount  of  premium  is  regulated  by  what 
they  can  get  the  men  to  exert  themselves  for ;  that  is,  if  by  a  series 
of  experiments  it  was  found  that  if  they  paid  15  per  cent  premium, 
the  men  would  not  do  the  work.  If  they  paid  45  per  cent  pre- 
mium, they  would  do  the  work,  but  it  might  not  be  necessary  to  pay 
that  much.  They  finally  get  to  30  per  cent  we  will  say.  So  that 
the  premium  is  not  an  amount  that  is  given  gratuitously  in  any  sense 
of  the  word.  If  the  labor  market  should  become  glutted,  it  would  be- 
come quite  possible  that  the  premium  would  be  lowered  either  by 
reducing  the  day  rate  or  by  lowering  the  premium,  so  that  that  is  a 
matter  that  is  decided  according  to  experiment  and  law— this  kind 
of  laws. 

It  has  also  been  ascertained  just  how  much  a  man  can  do  in  a  day 
by  experimenting  with  his  strength ;  that  is,  by  a  load  of,  say,  fifty 
pounds.  If  a  man  would  rest  a  certain  portion  of  time  in  a  day, 
he  would  carry  so  much.  By  the  system  of  experimenting  with  a 
good  strong  man  they  could  find  out  just  what  the  maximum  amount 


it  i 

%4  ■ 


SCIENTIFIC  SHOP  MANAGEMENT 


147 


of  the  load  was  he  could  carry  in  a  day.  The  idea  would  be  to  set  that 
as  a  day's  work.  In  regard  to  wages,  the  amount  of  wages  would  be 
set  by  what  they  could  get  the  man  to  work  for,  by  the  law  of  supply 
and  demand. 

We  have  figured  out  that  if  we  are  going  to  be  reduced  to  a  scientific 
formula,  so  to  speak,  we  are  going  to  object  that  it  is  not  to  our 
benefit  to  be  thus  experimented  with.  .  .  .  We  also  protest  against 
it  because  apparently  there  is  no  place  in  scientific  management  for 
collective  bargaining,  at  least  according  to  the  statement  of  these 
gentlemen  some  years  ago.  In  this  work  written  by  Mr.  Taylor,  in 
paragraphs  Nos.  425  and  426  of  his  "Shop  Management," 

The  writer  believes  one  way  of  regulating  the  wages  and  condition 
of  employment  of  whole  classes  of  men  by  conference  and  agreement 
between  the  leaders  of  unions  and  manufacturers  to  be  vastly  infe- 
rior, both  in  its  moral  effect  on  the  men  and  on  the  material  interests 
of  both  parties,  to  the  plan  of  stimulating  each  workman's  ambition  by 
paying  him  according  to  his  individual  worth,  and  without  limiting 
him  to  the  rate  of  work  or  pay  of  the  average  of  his  class. 

The  amount  of  work  which  a  man  should  do  in  a  day,  what  con- 
stitutes proper  pay  for  his  work,  and  the  maximum  number  of  hours 
per  day  which  a  man  should  work  together  form  the  most  important 
elements  which  are  discussed  between  workmen  and  their  employers. 
The  writer  has  attempted  to  show  that  these  matters  can  be  much 
better  determined  by  the  expert  time  student  than  by  either  the 
union  or  a  board  of  directors,  and  he  firmly  believes  that  in  the 
future  scientific  time-study  will  establish  standards  which  will  be 
accepted  as  fair  by  both  sides. 

That  is  an  indication  to  our  minds  that  there  is  really  no  place  in 
scientific  management  for  two  people's  opinions. 

It  has  been  stated  that  there  is  no  opposition.  As  far  as  we  can 
ascertain  from  the  workingman's  point  of  view,  there  is  nothing  but 
opposition  to  this  system.  We  have  been  opposing  it  for  a  long  time. 
...  It  has  been  stated  that  these  systems  provide  for  higher  rates 
of  pay  for  workmen.  That  is  not  literally  true,  according  to  the 
testimony  of  these  gentlemen.  In  paragraph  No.  37  of  this  book  on 
"Shop  Management" 

By  high  wages  he  means  wages  which  are  high  only  with  relation 
to  the  average  of  the  class  to  which  the  man  belongs  and  which  are 
paid  only  to  those  who  do  much  more  or  better  work  than  the  average 


. 


148      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  their  class.  He  would  not  for  an  instant  advocate  the  use  of 
a  high-priced  tradesman  to  do  the  work  which  could  be  done  by  a 
trained  laborer  or  a  lower-priced  man. 

The  idea  seems  to  be  that  the  systematizing  which  is  part  of  the 
Taylor  system  will  so  simplify  the  work  that  where  they  had  to  have 
a  high-priced  man  before  the  system  was  introduced,  afterwards  they 
could  get  along  with  a  cheaper  man.  While  the  cheap  man  would 
get  a  premium  or  a  bonus  for  speeding  up,  he  doesn't  receive  as  mi^ch 
as  the  man  whom  he  displaces  would  be  getting.  That's  the  ideal 
condition,  according  to  what  they  advocate.  That  condition  may  not 
have  been  achieved  anywhere,  but  that  is  possibly  due  to  the  inability 
of  the  managements  to  get  the  most  out  of  the  system  that  it  is 
possible  to  get  out  of  it.  That  hasn't  much  to  do  with  their  inten- 
tions, as  we  look  at  it.  Their  intentions  are  to  get  the  most  out  of 
the  men  for  the  least  money.  It 's  the  same  as  employers  have  ever 
done.  .  .  .  This  system  may  look  to  some  people  as  a  great  boon. 
It  looks  to  the  working  people  as  the  beginning  of  a  new  slavery,  if 
it  is  possible  to  enforce  it,  where  we  will  have  no  opportunity  to  get 
any  satisfaction  from  our  complaints.  What  satisfaction  would  a 
workman  get  who  went  to  the  office  and  complained  against  the  in- 
justice of  a  stack  of  books  like  that  ?  He  would  not  get  any 
consideration  at  all. 

We  can't  see  that  this  system  has  the  ingenuity  to  change  em- 
ployers' sentiments. 

Some  people  may  wonder  why  we  should  object  to  a  time  study. 
In  the  first  place  it  is  humiliating  for  a  man  to  be  suspected  of 
soldiering  and  loafing.  One  way  is  to  hold  a  stop  watch  on  him,  so 
that  he  doesn't  cheat.  That's  not  the  principal  objection.  The  ob- 
jection is  that  in  the  past  one  of  the  means  by  which  an  employee  has 
been  able  to  keep  his  head  above  water  and  prevent  being  oppressed 
by  the  employer  has  been  that  the  employer  didn't  know  just  exactly 
what  the  employee  could  do.  The  only  way  that  the  workman  has 
been  able  to  retain  time  enough  in  which  to  do  the  work  with  the 
speed  with  which  he  thinks  he  ought  to  do  it,  has  been  to  keep 
the  employer  somewhat  in  ignorance  of  exactly  the  time  needed.  The 
people  of  the  United  States  have  a  right  to  say  we  want  to  work  only 
so  fast.  We  don't  want  to  work  as  fast  as  we  are  able  to.  We  want 
to  work  as  fast  as  we  think  it's  comfortable  for  us  to  work.   We 


SCIENTIFIC  SHOP  MANAGEMENT 


149 


haven't  come  into  existence  for  the  purpose  of  seeing  how  great  a 
task  we  can  perform  through  a  lifetime.  We  are  trying  to  regulate 
our  work  so  as  to  make  it  an  auxiliary  to  our  lives  and  be  benefited 

thereby. 

Most  people  walk  to  work  in  the  morning,  if  it  isn't  too  far.  If 
somebody  should  discover  that  they  could  run  to  work  in  one  third 
the  time,  they  might  have  no  objection  to  have  that  fact  ascertained, 
but  if  the  man  who  ascertained  it  had  the  power  to  make  them  run, 
they  might  object  to  having  him  find  it  out. 


THE  PROBLEM  OF  LABOR  TURNOVER 


151 


1'' 


i>f 


^  I 


r 


THE  PROBLEM  OF  LABOR  TURNOVERS 

THE  typical  handicraftsman  of  the  Middle  Ages  pursued  the  same 
trade  all  his  life,  with  the  exception  of  the  Wanderjahr,  in  the 
same  town.  The  Industrial  Revolution  has  increased  the  mobility  of 
labor  in  at  least  four  different  ways:  (fy  Jn  ^^e  movement  between 
countries.  Individual  migration  as  opposed  to  group  migration  has 
been  the  characteristic  since  the  Industrial  Revolution.  The  growth 
of  America,  Canada,  and  Australia  during  the  nineteenth  century  was 
made  possible  largely  by  the  development  of  steam  power.  {2)^  In 
the  movement  between  different  sections  of  the  same  country.  The 
AmPficarTorioday  does  not  stay  predominantly  in  the  place  of  his 
birth.  He  moves  about  from  place  to  place.  The  Russell  Sage 
Foundation  found  that  of  22,000  men  investigated  in  seventy -eight 
cities,  only  16  per  cent  had  been  born  in  the  city  in  which  they 
were  then  living.-  Of  native-born  Americans  only  one  quarter  were 
living  in  the  city  of  their  birth.  (3)  In_th£j^pid_chang£_-at  resi- 
dence in  any  given  locality.  The  modern  worker,  while  in  a  town, 
rarely  lives  long  Tri  any  one  apartment  or  house.  He  moves  almost 
unceasingly.  (4)  In  the  frequent  changing  of  positions.  The  work- 
man may  leave  one  plant  to  enter  either  another^plant  in  the  same 
industry  or  one  in  a  totally  different  industry.^  Recent  studies  have 
shown  how  transitory  the  modern  wage  relation  is  and  how  tem- 
porary is  the  occupancy  of  any  particular  position. 

It  is  the  purpose  of  this  article  to  consider  solely  this  rapid  flux 
from  position  to  position,  and  to  examine  its  nature,  its  extent,  its 
cost,  and  its  causes  and  remedies. 

iprom  American  Economic  Review,  Vol.  VIII  (1918),  pp.  306-316;  Vol.  IX 
(1919),  pp.  402-405. 

2L.  P.  Ayres,  Some  Conditions  Affecting  Problems  of  Industrial  Education 
in  Seventy-Eight  American  School  Systems,  p.  7. 

3  See  Paul  de  Rousier's  "The  Labor  Question  in  Britain,"  pp.  288  ff. 

150 


L  WHAT  IS  "LABOR  TURNOVER"? 

Thej£miJJabQr  turnoYfirlLhaSL been  given  to  this  rapid  change 
from  position  to  position.  The  size  of  the  labor  turnover  depends 
uponthe^oportion  that  the  total  number  of  employees  hired  during 
a  year  bears  to  the  size  of  the  labor  force  that  must  be  maintained. 
To  illustrate :  a  plant  which  employs  1000  men  at  the  beginning  and 
end  of  a  given  year  hires  during  that  year  another  thousand.  That 
means  that  as  many  men  have  been  newly  hired  as  were  employed  at 
the  beginning  of  the  year  and  that  2000  men  have  been  employed 
during  the  year  to  fill  1000  jobs.  This  is  an  excess  of  1000  men  over 
what  would  have  been  needed  had  the  original .  force  stayed  through 
the  year,  and  is  reckoned  as  a  100  per  cent  labor  turnover.  Had  only 
500  new  men  been  hired  during  the  year,  the  turnover  would  have 
been  50  per  cent ;  had  2000  men  been  hired  it  would  have  been 
200  per  cent. 

II.  METHODS  OF  COMPUTING  LABOR  TURNOVER 

The  recent  discovery  of  the  extent  and  costs  of  labor  turnover  has 
brought  with  it  varying  methods  of  computation.  In  order  that  a 
standard  practice  might  be  adopted,  the  National  Association  of 
Employment  Managers  at  their  annual  meeting  in  May,  19 18, 
adopted  the  following  method,^  which  has  since  been  approved  by 
the  United  States  Bureau  of  Labor  Statistics  as  the  basis  for  its  inves- 
tigations:^ "  To  conipute  the  percentage  of  labor  turnover  for  any 
period,  find  the  total  separations  for  tHeTperToB  considered  and  divide 
bythe  average  of  the  number  actually  working  each  day  through  the 
period.'' 

1  For  a  full  statement  of  this  report  see  U.  S.  Bureau  of  Labor  Statistics, 
Monthly  Review,  Vol.  VI,  No.  6  (1918),  pp.  172-173.  That  this  method  did  not 
introduce  uniformity  may  be  seen  from  the  symposium  on  labor  turnover  in 
Industrial  Management,  September,  1918,  pp.  239-246,  and  November,  pp.  425- 
426,  in  which  from  five  to  six  different  methods  were  advanced,  practically  all 
of  which,  in  the  opinion  of  the  author,  are  wrong. 

2 See  Boris  Emmet,  "Labor  Turnover  in  Cleveland  and  Detroit,"  U.S. 
Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  VIII,  No.  i  (1919), 
pp.  11-30;  Paul  F.  Brissenden,  "Labor  Turnover  in  the  San  Francisco  Bay 
Region,"  U.  S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  VIII, 
No.  2  (i9i9)>  PP-  45-62. 


1 


.f*| 
I' 


152       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Before  criticizing  this  method  it  is  necessary  to  determine  just 
what  is  meant  by  "turnover."  Labor  turnover  is  simply  the  number 
of  men  hired  by  a  given  business  unit  to  take  the  places  of  men 
who  have  left.  Turnover  in  this  sense  is  exactly  similar  to  the  use 
of  the  term  by  any  retail  merchant  to  indicate  the  disposal  of 
certain  units  and  their  replacement  by  other  units.^  Turnover  as 
such  does  not  begin  until  replacement  occurs. 

The  percentage  of  labor  turnover  is  the  proportion  which  these 
newly  hired  men  who  actually  replace  others  form  of  the  average 
force  employed  in  a  given  period  of  time.  It  indicates  the  percentage 
of  men  which  it  has  been  necessary  to  hire  in  order  to  maintain  a 
constant  labor  force.  In  itself  it  indicates  nothing  as  to  whether  the 
force  itself  is  being  increased  or  decreased. 

In  the  light  of  this  definition  (which  I  believe  would  be  ap- 
proved by  every  student  of  the  problem),  the  method  of  computa- 
tion adopted  by  the  Bureau  of  Labor  Statistics  is  defective  in  the 
following  ways: 

I.  It  uses^sfpa  rat  ions  rather  than  replacements  as  the  basis  of 
turnover.  The  definition  of  turnover  adopted  by  the  Employment 
Managers  Association  is  indeed  as  follows:  "Labor  turnover  for  any 
period  consists  of  the  number  of  separations  from  service  during  that 
period.  Separations  include  all  quits,  discharges,  and  lay-offs  for 
any  reason  whatsoever." 

It  is  true  that  in  a  period  in  which  the  working  force  of  the  given 
plant  is  being  increased,  separations  do  roughly  constitute  the  amount 
of  turnover  which  takes  place.  Men  are  being  hired  not  only  to 
increase  the  net  working  force  but  to  take  the  place  of  those  who 
have  left.  It  is  only  in  the  latter  sense  that  they  constitute  replace- 
ments and  enter  into  turnover.  Separations  in  this  case,  therefore, 
do  approximately  measure  replacements.  To  be  absolutely  accurate, 
however,  one  should  subtract  the  vacated  positions  which  have  not 
been  filled  from  the  total  separations  to  secure  the  number  of  actual 
replacements.  Such  a  deduction,  however,  although  ideally  necessary, 
may  not  be  practically  possible  in  many  instances,  due  to  insufficient 
pay-roll  data. 

iWith  the  exception,  of  course,  that  a  high  labor  turnover  means  an  eco- 
nomic loss  to  the  employer,  while  a  high  turnover  of  goods  means  an  economic 
gain  to  the  merchant. 


THE  PROBLEM  OF  LABOR  TURNOVER     I53 

But  the  case  is  different  if  the  labor  force  is  decreasing.  Suppose 
that  a  given  plant  decreases  its  force  in  a  given  period  of  time  from 
looo  to  900  and  hires  no  new  men.  There  are  100  separations,  but 
no  new  men  have  entered  the  plant.  Turnover  as  such  has  not  oc- 
curred. Yet  the  method  adopted  by  the  Bureau  of  Labor  Statistics 
would  show  a  labor  turnover  of  100  men.  Plainly,  therefore,  in  this 
case  separations  do  not  measure  replacements.  The  number  of  men 
newly  hired  do  constitute  replacements.  It  is  not  correct,  moreover, 
in  the  case  of  a  declining  labor  force  to  deduct  the  positions  vacated 
but  not  replaced  from  the  number  newly  hired,  since  those  newly  hired 
have  replaced  some  workers  even  if  they  have  not  replaced  the 
particular  ones  whose  positions  are  vacated. 

The  proper  method,  therefore,  of  determining  replacements  should 

take 

a.  The  number  of  separations  actually  replaced  as  the  base  m 

the  case  of  an  increasing  force. 

■5.  The  number  newly  hired  as  the  base  in  the  case  of  a  de- 
creasing force. 

2.  It  uses  the  average  attendance  as  the  denominator  mstead  of 
the  number  actually_  employed  by  the  company.  The  best  index  of 
thr-aV5fage  numbeT  actually  employed  is  not  the  average  attendance 
but  the  average  number  on  the  pay  roU.^  The  use  of  the  average 
attendance  as  the  denominator  confuses  absenteeism  with  turnover. 
Recent  investigations  show  that  from  6  to  1 5  per  cent  of  the  work- 
ing force  are  absent  daily.  Yet  these  men  fill  positions  which  are 
part  of  the  working  force,  and  consequently  should  not  be  disre- 
garded in  computing  the  average  working  force.  Absenteeism  should 
be  treated  as  a  separate  item  in  labor  loss  and  not  included  in  the 
computation  of  turnover.- 

iCare  should  be  taken  that  the  pay  roll  does  not  contain  "dead  wood,"  or 
men  who  have  really  left  the  employ  of  the  company. 

2 Mr  Boris  Emmet,  an  investigator  for  the  U.S.  Bureau  of  Labor  Statis- 
tics, in  his  article  on  the  "Nature  and  Computation  of  Labor  Turnover,  Jour- 
nalof  Political  Economy  (February,  1919),  PP.  105-117,  has  come  to  beheve 
in  the  use  of  hirings  rather  than  separations  m  a  decreasmg  work  force,  but 
he  ^tiU  clings  to  the  use  of  the  average  attendance  as  the  denommator.  One 
of  his  objections  to  the  use  of  the  pay  roll  is  that  it  contams  absentees.  Of 
course  it  does,  but  these  can  be  computed  separately  and  should  not  be  confused 
with  turnover. 


I 


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Ill 


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if! 


154       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  preceding  paragraphs  indicate  the  methods  which  I  believe 
should  be  followed:  To  compute  the  percentage  of  labor  turnover 
for  any  period,  find  the  total  replacements  for  the  period  considered 
and  divide  by  the  average  number  on  the  pay  roll. 

The  difference  between  the  method  proposed  by  the  author  and 
that  adopted  by  the  Bureau  of  Labor  Statistics  may  be  seen  from 
the  following  two  nonalgebraic  examples : 


Example  A.  Computation  of  Labor  Turnover  with  an  Increasing 

Labor  Force 
I .  Given  statistics : 

Number  employed  at  beginning  of  month,  looo. 
Number  employed  at  end  of  month,  i  loo. 
Number  newly  hired,  300. 
Number  positions  vacated  not  filled,  i  o. 
Average  daily  attendance,  900. 
Method  of  Bureau  of  Labor  Statistics : 

Number  of  separations  =  300  —  (i  100  —  1000)  =  200. 
Labor  turnover  =  §g^  =  22.2  per  cent. 
Method  proposed : 

1000  4- 1 100 


2. 


Average  force  on  pay  roll 


=  1050.1 


Number  of  replacements  =  300  —  (i  100  —  1000)  —  10  =  190. 
Labor  turnover  =  ^^jYo'  or  18.1  per  cent. 
Percentage  of  absenteeism  =  j\%%  =  14.3  per  cent. 


A  Decreasing 


Example  B.  Computation  of  Labor  Turnover  with 

Labor  Force 

1.  Given  statistics : 

Number  on  pay  roll  at  beginning  of  month,  1000. 
Number  on  pay  roll  at  end  of  month,  900. 
Number  newly  hired,  25. 
Average  daily  attendance,  800. 

2.  Method  of  Bureau  of  Labor  Statistics : 

Number  of  separations  =  25  +  (1000  —  900)  =  1 25. 
Labor  turnover  =  ^5^,  or  15.6  per  cent. 


iThat  is,  the  arithmetic  average  of  the  number  employed  at  the  beginning 
and  end  of  the  month.  The  number  each  week  can  be  averaged  if  more  accurate 
methods  are  desired. 


THE  PROBLEM  OF  LABOR  TURNOVER     i5S 


1000  +  900  _ 


-  =  950. 


3.  Method  proposed : 

Average  number  on  pay  roll  = 

Number  of  replacements  =  25. 

Labor  turnover  =  g^.,%,  or  2.6  per  cent. 

QCO  —  800  o  4. 

Percentage  of  absenteeism  =  ^'  ^^^       '  or  1 5-8  per  cent. 

It  will  be  noticed  that  the  use  of  this  method  results  in  a  much 
lower  turnover  rate,  which  is  especially  true  in  the  case  of  a  decreasmg 

labor  force.  j  ,„  , 

The  labor  turnover  for  a  given  period  should  be  reduced  to  a 
yearly  basis  in  the  same  fashion  that  the  Public  Health  Service  re- 
duces mortality  and  morbidity  statistics  to  a  yearly  rate.  If  the 
given  period  is  a  month,  the  percentage  should  be  multiplied  by  12  ; 
ff  a  week  by  =2.  Care  should  be  taken  (i)  that  the  replacements 
listed  should  not  include  former  employees  newly  hired  for  their 
old  positions;  (2)  that  the  statistics  be  compiled  for  departments 
and  trades  as  well  as  for  the  plant  as  a  whole.  ' 

It  is  quite  clear  that  some  labor  turnover  is  inevitable.  Men 
who  die  or  fall  sick  or  are  injured  must  be  replaced.    Since  the  men 
and  women  in   industry  are  predominantly   in   those   age  groups 
where  mortality  is  lowest,  it  is  extremely  probable  that  *«  death  rate 
does  not  greatly  exceed  10  per  1000,  or  i  per  cent     Sydenstricker 
and  Warren  estimate  that  theAmerican  wa^e-earner  loses^on^.a.ver- 
age  abouUun£.daya^ear-h£Causeof  sickness  alone.^     On  a  basis  0 
^^T^J^Siiigdays  during  the  year,  this  would  be  an  average  loss  o 
;  per  cent  of  the  working  time.     But  a  corresponding  3  per  cent 
fabor  turnover  does  not  necessarily  follow,  because  illness  that  is 
only  of  short  duration  does  not  occasion  replacement.    Industrial 
accidents  furnish  another  small  source  of  the  labor  turnover    Non- 
fatal accidents  may  necessitate  a  replacement  of  from  :  per  cent  to 
2  per  cent.   However,  taken  all  together,  these  causes  would  not  be 
responsible  for  a  turnover  of  more  than  5  or  6  per  cent. 

IB    S    Warren   and  Edgar  Sydenstricker,  "Health  Insurance    its  Relation 

to  t^e  Lrneaith,"  Pubfic  ^^-'^^^'^^.'j-^^::^. 


1fi 


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jl 


156       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

III.  THE  AMOUNT  OF  THE  LABOR  TURNOVER 

No  complete  survey  of  the  amount  of  labor  turnover  in  plants 
throughout  the  country  is  as  yet  forthcoming.  The  Bureau  of  Labor 
Statistics  has  been  investigating  this  problem  for  over  two  years, 
but  the  results  of  their  research  have  not  yet  been  made  public! 
Several  studies  of  typical  plants  in  different  sections  of  the  country, 
however,  afford  a  bird's-eye  view  of  the  actual  situation. 

Mr.  W.  A.  Grieves,  of  the  Jeffrey  Manufacturing  Company,  in 
December,  1914,  made  the  first  detailed  analysis  of  the  extent  of 
the  labor  turnover.  Mr.  Grieves  obtained  the  employment  figures  of 
twenty  metal  plants  in  the  IVIiddle  West  and  found  that  to  maintain 
an  average  of  44,000  hands  during  the  year  they  were  compelled 
to  hire  a  total  of  69,000.  The  labor  turnover  for  these  plants  was 
consequently  157  per  cent  for  the  year.^ 

Mr.  Magnus  Alexander,  of  the  General  Electric  Companv,  pub- 
lished a  study  on  this  subject  in  191 5.  After  an  investigation  of  the 
employment  records  for  19 12  of  twelve  metal-manufacturing  plants 
in  six  states,  he  found  that  this  group,  which  employed  37,274  work- 
men at  the  beginning  and  43,971  at  the  end  of  the  year,' had  hired 
during  that  year  42,571  new  employees.-  Deducting  the  net  in- 
crease of  6697  in  the  working  force,  there  were  35,874  replacements 
during  that  year.  Using  the  number  employed  at  the  end  of  the 
year  as  a  base,  this  would  be  a  labor  turnover  of  82  per  cent.  Sup- 
posing that  the  increase  had  been  evenly  distributed  throughout  the 
year,  and  using  40,623  as  a  base,  the  turnover  for  these  plants  would 
be  88  per  cent. 

Mr.  Boyd  Fisher,  after  analyzing  the  employment  figures  for  the 
last  year  in  fifty-seven  Detroit  plants,  found  that  the  average  turn- 
over for  the  group  was  252  per  cent.^  The  Ford  Motor  Company 
from  October,  1912,  to  October,  1913,  hired  54,000  men  to  maintain 
an  average  working  force  of  13,000.    This  was  a  labor  turnover  of 

T^  !^'  4,;  ^'■'.^^^S'  The  Handling  of  Men  (published  by  the  Executives'  Club, 
Detroit  Chamber  of  Commerce),  p.  3. 

2 Magnus  W.  Alexander,  "Hiring  and  Firing,  the  Economic  Waste  and  How 
to  Avoid  It,    American  Industries,  August,  1Q15,  p.  18. 

3 Boyd  Fisher,  "How  to  Reduce  the  Labor  Turnover,"  Annals  of  the  Amer- 
tcan  Academy,  Vol.  LXXI,  p.  14.  '  .      ^^      '^  '»"»<^'^ 


THE  PROBLEM  OF  LABOR  TURNOVER 


157 


416  per  cent  for  the  year.^  The  figures  from  other  plants  are  almost 
equally  striking.  A  large  Philadelphia  concern  had  a  labor  turnover 
of  100  per  cent  in  191 1.-  The  turnover  of  the  Plimpton  Press  was 
186  per  cent  in  19 12.''  The  Pacific  Telephone  and  Telegraph  Com- 
pany, of  Portland,  Oregon,  hired  202  new  girls  in  three  months  to 
maintain  an  average  force  of  700.  If  this  is  typical  of  the  year,  the 
turnover  was  115  per  cent.  Mr.  Gregg  has  stated  that  the  turnover 
of  the  carding  department  of  a  certain  cotton  mill  was  over  500 
per  cent  for  one  year.*  Representatives  of  the  Goodrich  Tire  and 
Rubber  Company  have  declared  that  their  turnover  in  former  years 
was  nearly  200  per  cent  and  that  for  the  last  year  it  has  been 

even  higher !  ^ 

The  turnover  for  juvenile  labor  is  especialb^Jiigh.  The  Board  of 
Education  of  Rochester,  New  York,  found  that  boys  between  the 
ages  of  fourteen  and  sixteen  changed  their  jobs,  on  the  average,  every 
seventeen  weeks.''^  This  is  a  turnover  for  juvenile  labor  of  over 
300  per  cent.  The  employment  records  of  Swift  and  Company  of 
Chicago  show  that  the  average  term  of  employment  for  a  boy  in 
their  service  was  only  three  and  a  half  months.'  This  means  that 
nearly  three  boys  and  a  half  are  employed  every  year  for  each 
position  or,  to  be  accurate,  that  there  is  a  labor  turnover  of  342 
per  cent.  Figures  from  Indianapolis,  Indiana,  show  that  of  6710 
jobs  held  by  children  leaving  school  7  per  cent  were  for  less  than 
two  weeks ;  15  per  cent  for  less  than  a  month  ;  30  per  cent  for  less 
than  two  months;  and  48  per  cent,  or  practically  one  half,  for 
less  than  three  months.** 

1  Boyd  Fisher,  "  Methods  of  Reducing  the  Labor  Turnover,"  U.  S.  Bureau  of 
Labor  Statistics,  Bulletin  No.  227  (191 7). 

2 J.  H.   Willetts,  "Steady   Employment,"   supplement   to   the   Annals,  Vol. 

LXV,  p.  70. 

3  Jane  C.  Williams,  "The  Reduction  of  the  Turnover  of  the  Plimpton  Press," 

Annals,  Vol.  LXXI,  p.  80. 

4R.  C.  Gregg,  "A  Method  of  Handling  the  Problem  of  Labor  Turnover, 

Textile  World  Journal,  April  28,  1917. 

5 John  A.  Fitch,  "Making  the  Boss  Efficient,"  The  Survey,  Vol.  XXXVIII, 

p.  211.  ■Kj  \r 

6  Fifty-sixth  Annual  Report  of  the  Board  of  Education,  Rochester,  N.Y., 

p.  142. 

7  National  Association  of  Corporation  Schools,  April,  1916,  p.  13. 

8  Adapted  from   figures  given  in  Indianapolis  Vocational  Survey,  Bulletin 
No.  21,  Vol.  I,  p.  119. 


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158       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The.i3giires..inr  manufacturing  indicate,  therefore,  that  the  turn- 
QKer  for  this  branch  of  industry  is  extremely  high.  MrT^mest  M. 
Hopkins,  who  has  had  a  great  deal  of  experience  as  an  employment 
manager  for  several  large  industrial  concerns,  has  said  that  a  con- 
servative estimate  for  many  industries  would  be  100  per  cent.^ 
Mr.  Ethelbert  Stewart,  who  was  in  charge  of  the  field  work  for  the 
Bureau  of  Labor  Statistics,  has  stated  that  some  firms  have  as  high 
a  turnover  as  400  per  cent.^ 

The  turnover  in  many  branches  of  agricultural  and  construction 
work  is  even  greater.  Professor  Carleton  Parker,  in  a  most  inter- 
esting study  of  casual  labor  on  the  Pacific  coast,  cites  a  dried-fruit 
farm  in  California  that  had  a  monthly  turnover  of  176  per  cent ;  a 
construction  job  in  the  Sierras,  with  a  normal  force  of  950  men,  which 
had  a  monthly  turnover  of  158  per  cent;  and  a  ranch  with  a  nine 
weeks'  fruit  season  which  had  a  monthly  turnover  of  245  per  cent.-* 
After  a  careful  investigation  he  concluded  that  the  average  duration 
of  a  job  in  certain  kinds  of  work  was  as  follows  :* 

Days 
Lumber  camps i  ^.^o 

Construction  work i© 

Harvesting y 

Mining 60 

Canning 30 

Orchard  work 7-10 

IV.  THE  COST  OF  THE  LABOR  TURNOVER 

AJiigh  labor  turnover  is  not  always  an  economic^wa&te  to  the 
employer.  A  plant  with  many  rush  orders  paying  high  wages  may 
find  it  to  its  economic  interest  l(5~drtve  its  workmen  aQiicF  a  pace 
that  they  will  be  exhausted  atjhe  end  of  a  few  mouths.  The  old 
group  of  workmen  can  then  be  discharged  and  a  new  group  employed. 
Many  munition  factories  in  the  United  States  followed  such  a  policy 
during  the  years  1915  and  1916.  Though  this  is  of  course  poor 
economy  from  the  standpoint  of  social  efficiency,  and  has  been  so 

1  Proceedings,  Third  Annual  Convention,  National  Association  of  Corporation 
Schools,  p.  758. 

2  Bureau  of  Labor  Statistics,  Bulletin  No.  202,  p.  8. 

3 Carleton  H.  Parker,  "The  California  Casual  and  his  Revolt,"  Quarterly 
Journal  of  Economics,  Vol.  XXX  (1915),  p.  121.  *Ibid.  p.  122. 


ii 


THE  PROBLEM  OF  LABOR  TURNOVER     I59 

recognized  in  both  England  and  America  under  the  stress  of  war, 
yet  it  may  well  have  been  a  paying  policy  for  many  firms. 

As  a  rule,  however,  the  employer  suffers  a  very  real  economic 
loss  Trom  a  high  turnover.  Although  it  is  impossible  to  obtain 
exact  figures  on  the  cost  of  the  excessive  hiring  and  firing,  careful  esti- 
mates are  fortunately  available.  The  principal  items  that  enter 
into  the  cost  of  employing  new  men  are 

1.  The  clerical  cost  of  hiring  and  firing.  This  includes  the  time 
of  the  official  (generally  the  overleerTwEo  discharges  the  old  worker 
and  employs  the  new,  plus  the  time  spent  on  the  additional  pay  roll 

and  other  records. 

2.  The  cost  of  the  instruction  given  the  new  employees  by  the 
foremen^and^lHe  assi'stants. '  Even  if  "tli'e  workman  Is  experienced, 
^SHiiiiFabirtime  must  be  spent  in  explaining  the  details  peculiar 
to  that  particular  plant.  The  cost  of  training  a  worker  for  a  skilled 
or  semiskilled  position  is  much  larger  still. 

3.  Decreased  production  by  the^newjyx^cto:  .belore  coming  up  to 
full  working  capacity.  It  takes  time  to  "warm  up"  to  one's  work 
^Tid-T5a^'the  maximum  of  efficiency.  Rapid  shifting  of  men  per- 
petuates  this   period    of   novitiation    with    its   greatly    diminished 

productivity. 

4.  Breakage  and  damage  causecl  by  the  new  map.  This  includes 
(a)  STe  actual  "breakage  of  a  machine  or  tool ;  (b)  the  stoppage  of  a 
machine,  or  the  delay  of  work;  (c)  accidents  to  the  workers,  for 
which  the  employer  is  liable  under  workmen's  compensation  laws ;  O^ 
(d)  the  wasting  or  destruction  of  material  upon  which  the  new 
worker  is  employed. 

5.  The  cosLoLKJIi^-^^^^'^^^v  ^"^  eauipmejiLwhere  the  old  posi- 
tion  is  notjmmediatel^^ 

flFSsTpiTl^iirnaturally  varies  with  the  type  of  worker.   Alex- 
ander  classifies  the  employees  under  five  heads : 

A.  Highly  skilled  mechanics  who  have  spent  years  in  attaining 
their  present  proficiency. 

B.  Mechanics   of  lesser   skill  who  secured   their   training   in  a 

year  or  two. 

C.  Operatives   who,   without   previous    experience,    can    acquire 

a  fair  degree  of  efficiency  within  a  few  months. 

D.  Unskilled  laborers  needing  practically  no  training. 


4fl 


i 


1 60       TRADE  UNIONISM  AND  LABOR  PROBLEMS 
E.  The  clerical  force. 

His  careful  estimate  of  the  expense  per  man  for  the  various  groups 
is  as  follows :  ^ 

^ 54.S.00 

^ S^.So 

c 

73-50 

D i' 

o.  50 

E 

29.00 

This  is  of  course  only  an  estimate,  although  a  very  careful  one. 
Mr.  Grieves  estimated  that  tiie  per  capita  cost  averaged  at  least 
S40.-  Mr.  John  U.  Williams,  of  the  Fayette  R.  Plumb  Company  of 
Philadelphia,  a  tool-making  concern,  states  that  ''the  final  cost  per 
experienced  man  is  over  Sioo."^ 

Mr.  Alexander  estimated  that  the  annual  unnecessary  expense  for 
the  twelve  factories  that  he  covered  was  between  $830,000  and 
$1,000,000.  If  Mr.  Grieves's  estimate  of  an  average  cost  of  $40  is 
used,  the  total  yearly  loss  for  the  twenty  firms  which  he  investigated 
was  $1,760,000,  or  an  average  of  $88,000  per  firm.  The  yearly  cost 
to  the  Ford  Motor  Company  for  its  416  per  cent  turnover  was  over 
$2,000,000.  Since  these  are  figures  for  only  a  few  plants,  the  annual 
cost  for  the  country  as  a  whole  must  be  tremendous.  A  most 
conservative  estimate  would  be  between  one  and  two  hundred  millions. 

V.  CAUSES  AND  REMEDIES  OF  THE  LABOR  TURNOVER 

This  excessive  shifting  from  position  to  position  clearly  demon- 
strates that  something  is  wrong  with  industry.  In  diagnosing  its 
causes  we  are  at  the  same  time  enabled  to  suggest  certain  remedies 
that  may  lessen  it. 

Some  ni  theuilQre_2ronijnent_causea,jire 

^'  Poor  methods  of  employment  and  discharge.  Men  are  gen- 
erally hired  en  masse,  with  little  regardlolKeir' qualifications,  and 
fired  summarily  if  they  do  not  make  good  on  the  jobs  upon  which 
they  are  tried  out.     The  power  of  employment  and  discharge  is 

1  Alexander,  op.  cit.,  pp.  20-21. 
-W,  A.  Grieves,  op.  cit.,  p.  5. 

3 John  M.  Williams,  "An  Actual  Account  of  what  we  have  done  to  Reduce 
our  Labor  Turnover,"  Annals,  Vol.  LXXI,  p.  54. 


THE  PROBLEM  OF  LABOR  TURNOVER 


161 


generally  vested  in  the  foreman  of  each  department.   These  men  are 
rarely  skilled  in  the  tactful  handling  and  judging  of  men. 

2.  Poor  methods  of  promotion  within  thejactory.  Work  in  one 
position  rarely  leads  to  a  higher  position.  The  workman  in  any 
particular  plant  relies  therefore  upon  a  change  to  some  other  plant 
to  better  his  status. 

3.  The  seasonal  nature  of  many  industries.  The  turnover  is 
necessarily  large  ^vhere  the  volume  of  output  is  not  evenly  distrib- 
uted over  the  year.  After  the  "peak"  has  been  passed,  many 
workmen  must  be  laid  off.  If  the  peak  reoccurs  within  a  few  months, 
a  new  force  must  be  employed.  Positions  of  short  duration,  spelling 
a  high  turnover,  are  the  inevitable  concomitants  of  seasonal  industry. 

4.  Juvenile Jabor..  Children  rarely  stay  long  in  one  position. 
The  fourteen-  tTsixteen-year-old  child  is  restless  and  wants  to  move 
about.   A  regular,  settled  employment  rarely  satisfies  him. 

5.  The  monotony  of  modern  factory  labor.  This  is  rarely  men- 
tioned as  a  cause  of  labor  turnover,  but  on  a  priori  grounds  we  must 
infer  that  it  exercises  tremendous  influence.  Specialization  and 
routine  labor  have  rendered  industry  so  dull  that  it  is  no  wonder 
the  modern  artisan  frequently  throws  up  his  job  and  seeks  another 
plant  from  sheer  weariness. 

6.  Low  wages.  A  plant  that  pays  low  wages  cannot  hold  men 
long.  TEey'regard  the  job  as  a  makeshift  and  will  leave  it  as  soon 
as  they  can  find  another. 

Thus  some  of  the  causes  of  this  newly  discovered  phenomenon  are 
long-recognized  evils,  while  some  have  been  but  newly  brought  to 
light.    The  remedy  most  frequently  proposed  by  students  of  the  sit- 
uation is  the  installation  of  a  specialized  employment  department  to 
have  complete  charge  of  the  hiring,  handling,  and  firing  of  men. 
In  most  factories  the  task  of  employment  and  the  discharge  of  men 
is  confided  to  the  foremen  of  the  various  departments.   Hands  are 
both  hired  and  fired  in  a  hit-or-miss  fashion.    Many  firms  keep  no 
employment  records  at  all,  and  most  of  those  that  do  keep  such 
records  have  only  scanty  material.   They  seldom  ask  the  reasons  for 
the  workman's  leaving,  nor  do  they  measure  the  turnover  depart- 
ment by  department.    The  centralization  of  employment  and  dis- 
charge and  the  concentration  of  responsibility  would  permit  the  use 
of  scientific  methods. 


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162       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Such  a  department  could  lessen  the  turnover  in  the  following  ways  : 

1.  By  the  use  of  a  better  method  of  selecting  employees.  Ph)^- 
caljte3la_would  eliminate  a  considerable  number  that  are  now  em- 
ployed only  to  be  shortly  discharged.  Though  mental  tests  have  not 
developed  as  yet  so  far  as  to  make  it  possible  to  assign  men  to  the 
particular  jobs  for  which  they  are  best  adapted,  at  least  those 
mentally  incompetent  for  industry  could  be  eliminated.  The  various 
jobs  in  the  plant  could,  moreover,  be  analyzed  in  respect  to  the 
amount  of  skill  and  intelligence  required  of  the  operative.  The 
workers  could  then  be  divided  into  rough  groups  according  to  their 
previous  training  and  innate  mental  ability  and  assigned  to  the 
corresponding  grade  of  work.  A  centralized  personnel  department 
could  follow  up  and  verify  work  references  and  thereby  classify 
workers  on  the  basis  of  past  experience.   And  it  could  maintain  a 

..waiting  list,  so  that  when  new  men  were  needed  they  could  be  chosen 
largely  from  men  about  whom  something  was  known  instead  of,  as 
now,  being  picked  up  off  the  streets. 

2.  By  fl^-sj^atem  of  folbw-up  work  for  the  new  employees.  This 
would  include  taking  them  to  their  place  of  work  and  indicating  a 
friendly  interest  towards  them.  The  training  should  be  given  prefer- 
ably by  special  instructors  and  not  confided  to  the  foremen.  In 
many  cases  it  is  best  to  give  the  new  men  preliminary  training  be- 
fore they  are  actually  placed  in  any  department.  Moreover,  the 
working  conditions  should  be  closely  watched  by  the  personnel 
department  in  order  to  insure  proper  ventilation,  lighting,  the  pre- 
vention of  dust,  and  the  lessening  of  fire  and  accident  risks.  To 
keep  a  record  of  absences,  classified  by  individuals  and  by  causes, 
would  also  be  a  legitimate  task  for  such  a  department. 

3.  By  an  investigation  of  the  reasons  for  the  successes  and  fail- 
ures  of  individual  workmen.  The  method  commonly  employed  is  to 
discharge  a  workman  if  he  fails  to  make  good  on  a  particular  job. 
This  involves  a  great  waste.  A  workman  may  fail  on  a  specific  job 
and  yet  be  a  valuable  man  for  the  concern.  It  may  be  that  the 
antagonistic  attitude  of  the  foreman  or  the  men  is  such  that  he  can- 
not do  himself  justice.  It  may  be  that  he  is  ill-adapted  to  that  partic- 
ular position  but  would  be  perfectly  competent  in  a  position  in  some 
other  department.  The  worker  embodies  a  considerable  investment 
of  capital  by  the  employer  and  is  worthy  of  at  least  another  trial 


THE  PROBLEM  OF  LABOR  TURNOVER 


163 


before  he  is  discharged.    The  personnel  department  can  find  out  the 
reasons  for  his  lack  of  success  and  act  accordingly. 

Should  the  worker  succeed  in  a  given  position  he  should  be  com- 
mended and  assured  promotion.  A  welLdefined.  prQmPtJQn  policy 
would  indeed  save  many  a  plant  a  great  deal  of  dissatisfaction  and 
lessened  efficiency.  The  efficiency  of  the  plant  and  the  loyalty  of 
the  workers  may  be  further  heightened  by  the  institution  of  dis- 
cussion groups  at  which  plant  problems  can  be  explained  and  work- 
men's ideas  solicited.  This  will  also  serve  to  bring  to  light  hidden 
talent  which  could  be  utilized  in  executive  work. 

The  creation  of  such  a  personnel  department,  charged  with  these 
functions,  is  but  the  logical  extension  to  the  human  side  of  industry 
of  the  scientific  principles  that  have  hitherto  been  employed  on  the 
mechanical  side.    It  merely  strips  the  department  foreman  of  his 
employment  functions  and  enables  him  to  concentrate  his  attention 
upon  the  actual  production  of  goods.   With  this  splitting  of  the  task- 
greater  specialization  and  efficiency  can  result.   The  centralized  em- 
ployment department  has  been  tried  in  many  plants  and,  on  the 
whole,  has  been  very  successful.'    Some  illustrations  of  its  success 
are  (i)  the  reduction  by  the  Dennison  Manufacturing  Company  of 
its  turnover  from  68  per  cent  to  37  per  cent  a  year  ;  (2)  the  reduction 
of  the  turnover  by  the  Joseph  and  Feiss  Company  of  Cleveland,  Ohio, 
to  one  third  its  former  amount ;  ( 3 )  the  lowering  of  the  Plimpton  Press 
turnover  till  it  is  now  6nly  10  per  cent  a  year  ;  (4)  the  decrease  in  the 
Ford  turnover  from  416  per  cent  to  less  than  80  per  cent.    Other  fac- 
tors besides  that  of  the  creation  of  such  a  department  contribute  to  the 
marked  decrease  in  three  of  these  plants.  Forms  of  profit-sharing  were 
introduced  into  the  Dennison  and  Ford  companies,  while  the  Dennison 
and  Feiss  plants  also  succeeded  in  regularizing  their  output .^ 

1  There  are  probably  over  500  employment  managers  in  the  United  States 
as  a  whole.  The  following  cities  have  local  associations  of  employment  man- 
agers :  Boston,  Chicago,  Cleveland,  Detroit,  Newark,  New  York,  Philadelphia, 
Pittsburgh,  Rochester,  and  San  Francisco.  The  following  are  among  the  large 
concerns  to  have  special  emplovment  departments:  Sears,  Roebuck  &  Co.; 
Marshall  Field  &  Co.;  Armour  &  Co.;  Packard  Motor  Car  Co.;  Ford  Motor 
Co.;  Equitable  Life  Insurance  Co.;  R.  H.  Macy  &  Co.;  American  Tel.  &  Tel.; 
Curtis  Pub  Co.;  John  B.  Stetson  Co.;  Westinghouse  Electric  Co.;  Eastman 
Kodak  Co.;  Dennison  Mfg.  Co.;  Cheney  Bros.  See  J.  H.  Willetts,  "Develop- 
ment of  Employment  Managers'  Associations,"  U.  S.  Bureau  of  Labor  Statistics, 
Monthly  Review,  Vol.  V,  No.  3  (1917),  PP-  85-87.  ^  Gregg,  op.  at. 


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164       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Small  concerns  would  probably  not  find  it  profitable  to  create 
a  special  personnel  department.  Consequently  this  is  one  of  the 
advantages  of  large-scale  production.  Whether  there  is  a  greater 
turnover  in  the  larger  plants  which  will  offset  this  advantage  is  a 
question  that  cannot  be  answered  at  present. 

Profit-sharing  is  another  method  of  insuring  greater  permanence 
of  labor.  Mr.  Boris  Emmet,  who  investigated  profit-sharing  schemes 
for  the  Bureau  of  Labor  Statistics,  says,  "All  the  informants,  with- 
out exception,  were  also  of  the  opinion  that  the  establishment  of  the 
plans  has  a  tendency  to  reduce  the  percentage  turnover  of  their 
working  organization."  ^ 

In  so  far  as  the  labor  turnover  is  caused  by  the  seasonal  nature 
of  industry  the  creation  of  a  specialized  employment  department 
would  offer  no  remedy.  Once  the  cost  of  labor  turnover  is  recognized, 
the  employers  will  see  that  the  regularization  of  industry  and  the 
smoothing  of  the  peaks  of  production  will  be  economically  bene- 
ficial to  them.  The  efforts  of  the  Clothcraft  Shops  of  Cleveland 
and  the  Dennison  Manufacturing  Company  have  been  turned  espe- 
cially in  this  direction. 

The  large  turnover  of  children  between  fourteen  and  sixteen  is 
merely  another  proof  of  the  economic  and  social  wastefulness  of  this 
class  of  labor.  Industry  and  society  would  be  much  better  off  were 
the  age  of  entrance  into  industry  raised  generally  from  fourteen  to 
sixteen  years.  In  so  far  as  the  labor  turnover  is  due  to  the  monotony 
of  machine  labor,  few  remedies  within  the  plant  can  be  devised.  The 
men,  to  be  sure,  can  be  transferred  from  one  machine  to  another.- 
But  this  is  about  all.  The  balking  of  man's  innate  tendency  towards 
contrivance  seems  to  be  an  inevitable  consequence  of  the  machine 
era.  New  avenues  must  be  opened,  outside  of  industry,  for  its 
legitimate  expression. 

Whatever  may  be  the  final  steps  taken  to  solve  this  problem,  its 
recognition  signalizes  a  marked  advance  in  the  development  of 
human  engineering. 

Paul  H.  Douglas 

U.  S.  Emergency  Fleet  Corporation 

^"Profit-sharing  in  the  United  States,"  U.S.  Bureau   of  Labor  Statistics 
Bulletin  No.  208  (191 7). 

-Mr.  Dennison  does  this  in  his  factory. 


li 


II 


XIII 

PERSONAL  RELATIONSHIP  AS  A  BASIS  OF 
SCIENTIFIC  MANAGEMENT^ 

GIVEN  two  establishments  in  the  same  industry,  in  the  same  local- 
ity, build  for  them  the  same  buildings,  equip  them  with  the  same 
machinery,  and  establish  for  them  similar  methods  of  handling 
equipment  and  materials — yet,  in  the  course  of  a  short  time,  there 
will  be  a  difference  in  both  the  quantity  and  the  quality  of  their  out- 
put. This  difference  in  result  will  be  caused  by  the  difference  between 
the  two  in  the  quality  of  their  personnel.  For  this  reason  alone 
the  question  of  personnel  must  ultimately  be  considered  the  real 
problem  of  management. 

If  one  of  the  above  plants  were  headed  by  a  management  of 
the  ordinary  or  traditional  type  and  the  other  by  a  management 
which  fully  realized  the  importance  of  personnel  and  had  devel- 
oped an  active  philosophy  tending  toward  the  solution  pi  the  per- 
sonal problem,  the  difference  in  practical  results  would  be  so 
great  as  to  be  unbelievable  by  the  uninitiated.  In  fact,  this  differ- 
ence alone  would  often  spell  failure  in  the  one  case  and  success  in 
the  other. 

The  managers  of  both  plants  would  see  the  shortsightedness  of 
letting  buildings  and  other  equipment  run  down  for  lack  of  upkeep 
and  repair.  Both  would  see  the  value  of  and  put  into  practice  means 
for  running  the  machinery  at  the  most  efficient  speeds  and  bringing 
into  use  the  best  tools  and  the  best  method  of  handling  material. 
It  would  be  taken  for  granted  by  both  that  anything  that  goes  to  the 
improvement  and  upkeep  of  these  things  would  be  a  necessary  ex- 
penditure or  a  wise  investment.  The  ordinary  management,  how- 
ever, would  not  think  of  applying  the  same  laws  of  upkeep  and 
improvement  to  the  personal  equipment.  .  .  . 

^From  address  before  Society  to  Promote  the  Science  of  Management. 
Taylor  Society  Bulletin,  November,  1915. 

165 


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1 66      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Only  actual  comparison  of  the  mechanical  and  other  developments 
in  this  establishment  with  those  in  the  next  best  establishment  in  the 
men's  clothing  industry  would  suffice  to  prove  this  point.  The  in- 
dustry generally  is  not  in  a  very  advanced  state.  The  usual  type  of 
management  is  at  the  best  only  beginning  to  realize  the  existence  of 
the  personal  side.  As  a  result,  machinery  and  equipment  are  almost 
universally  limited  to  a  few  undeveloped  or  semideveloped  types, 
regardless  of  whether  or  not  they  are  most  suitable  for  the  purpose 
in  the  hands  of  the  individual  operator.  In  practically  all  these  fac- 
tories you  will  find  only  a  few  types  of  machines,  and  these  set  up 
and  equipped  as  they  come  from  the  manufacturers  and  running  at 
haphazard  speeds.  Shears  and  all  other  tools  are  any  which  the  em- 
ployee chooses  to  furnish  for  himself. 

In  the  Clothcraft  Shops,  working  from  the  personal  point  of  view, 
not  only  are  tools  developed  and  prescribed  with  regard  to  their  suit- 
ability for  the  purpose  of  individual  accomplishment,  but  all  tools 
are  furnished  and  maintained  by  the  management.  Fully  50  per 
cent  of  the  different  types  of  machines  in  use  at  the  Clothcraft  Shops 
are  not,  as  far  as  is  known,  used  in  any  other  establishment  in  the 
industry,  and  practically  every  machine  in  use  has  been  developed 
so  as  to  be  specially  adapted  for  its  particular  purpose  in  the  hands 
of  the  individual  who  uses  it.  In  like  manner  the  proper  handling 
of  materials  and  the  installation  of  other  methods  developed  under 
scientific  management  have  been  introduced  in  this  establishment  as 
necessary  steps  in  the  development  of  the  highest  efficiency  of  the 
individual.  .  .  . 

All  responsibilities  of  the  management  in  the  direction  of  personal 
service,  directed  toward  the  welfare  and  development  of  the  indi- 
vidual, are  part  of  the  function  of  employment.  For  the  purpose  of 
administering  this  function  the  Clothcraft  Shops  of  The  Joseph  and 
Feiss  Company  have  established  an  Employment  and  Service  De- 
partment. In  this  organization  this  department  is  considered  one  of 
the  most  important  adjuncts  to  the  management. 

While,  as  mentioned  above,  hiring  is  only  a  small  part  of  the 
function  of  employment,  nevertheless,  the  solution  of  the  problem 
of  selection  is  of  great  importance  in  its  bearing  on  the  whole 
future  development  of  the  worker.  All  applicants  for  positions  are. 
interviewed  by  one  of  the  heads  of  the  Employment  and  Service 


PERSONAL  RELATIONSHIP 


167 


Department  of  the  Clothcraft  Shops.  Certain  specific  information 
concerning  the  applicant  is  obtained  in  every  case  and  entered  on 
a  blank  for  the  purpose.    Information  deemed  essential  consists  of : 

Name  and  address. 

Date  of  application. 

Date  and  place  of  birth. 

Date  of  immigration,  if  foreign  bom. 

Parentage. 

Languages  spoken. 

Education. 

Whether  married  or  single. 

Number  in  family. 

Wage  contribution  to  family  support. 

Record  of  previous  employment. 

The  idea  should  be  to  keep  such  records  as  simple  as  possible- 
only  the  important  details  being  entered. 

Languages  spoken  may  be  important  in  many  organizations  for 
various  reasons.    In  this  establishment  English-speaking  applicants 
are  given  preference.    In  case  employment  should  be  given  to  an  ap- 
plicant who  does  not  understand  English,  the  applicant  must  agree 
to  attend  one  of  the  classes  in  English  which  are  held  at  the  factory. 
The  Board  of  Education  of  the  city  of  Cleveland  has  cooperated 
by  furnishing  teachers  and  textbooks  for  these  classes.   Where  appli- 
cants do  not  speak  the  English  language  it  has  often  been  found 
that  their  residence  in  the  country,  and,  consequently,  their  employ- 
ment, is  considered  merely  temporary  by  them.    In  the  case  of  those 
who  do  not  speak  the  English  language  it  has  been  found  very  diffi- 
cult to  impart  instructions  and  to  obtain  proper  standards  of  out- 
put and  quality.    Of  thirty-five  employees  (out  of  a  total  of  nearly 
800)  who  have  not  sufficient  knowledge  of  English  to  understand 
instructions  thoroughly  only  one  has  reached  efficiency  equal  to  that 
of  the  best  doing  the  same  kind  of  work.   Eight  of  this  number  have 
reached  efficiency  equal  to  less  than  the  average,  and  the  remaining 
twenty-six  are  the  least  efficient  at  their  respective  operations.    More- 
over, people  who  cannot  speak  the  same  language  cannot  under- 
stand each  other  thoroughly,  and  therefore  can  never  attain  that 
State  of  friendly  feeling  which  is  the  basis  of  cooperation  and  spirit. 


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1 68       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Thp  mRttpr  nfj^age, contribution  is  importRnf     Other  things  being 
equal,  preference  should  be  given  to  those  who  have  to  support 
themselves  or  whose  contribution  to  tlie  fanuly  income  is  a  necessity. 
The  custom  of  contributing  the  entire  earnings  to  the  family  income 
is  often  an  important  element  in  inefficiency,  especially  where  the 
contribution  is  in  whole  or  in  part  unnecessary.    Younger  women 
who  live  at  home  are  often  required  to  turn  over  the  entire  contents 
of  their  pay  envelopes  to  the  head  of  the  family,  even  where  such  a 
contribution  is  not  necessary.    By  depriving  the  worker  of  the  use 
of  his  earnings,  the  incentive  toward  efficiency  is  removed  and  ambi- 
tion destroyed.    Cases  of  this  kind  are  being  constantly  handled  by 
the  Employment  and  Service  Department.  A  home  visit  by  one  of  the 
staff  has  always  resulted  in  an  agreement  being  reached  with  the 
parents  by  which  a  stipulated  sum  was  paid  into  the  family  ex- 
chequer and  the  remainder  of  the  earnings  kept  by  the  employee  in 
question  and  deposited  in  the  Clothcraft  Penny   Bank.    Such  an 
arrangement  has  always  proved  beneficial  and  has  developed  an  in- 
crease of  efficiency  ranging  from  20  per  cent  upward.   A  case  in 
point  is  that  of  Tillie  B.,  who  had  been  the  subject  of  a  great  deal 
of  attention  over  a  long  period  of  time  for  the  purpose  of  increasing 
her  earnings,  which  averaged  13  cents  per  hour.   After  an  arrange- 
ment such  as  mentioned  above  had  been  made,  Tillie's  earnings  im- 
mediately jumped  and  soon  reached  22  cents  an  hour,  which  she 
held  until  she  left  the  organization  to  be  married. 

Information  as  to  past  employment  is  important  as  a  record  of 
experience  and  earnings.  The  number  of  positions  held  is  also  an 
indication  as  to  whether  or  not  the  applicant  is  a  floater.  For  pur- 
poses of  reference  this  information  is  of  little  or  no  value  and  is 
never  used  at  the  Clothcraft  Shops.  Wherever  possible,  however 
applicants  give  as  their  references  members  of  the  Clothcraft  organi- 
zation. This  tends  to  keep  alive  in  the  organization  an  active  interest 
m  the  kind  of  new  employees.  It  is,  moreover,  a  good  indication  of 
the  applicant's  character,  since  although  a  person  cannot  always  be 
judged  by  his  family,  he  can  generally  be  judged  bv  his  friends 

The  interviewing  of  applicants  is  important  and 'requires  consid- 
erable tact,  judgment,  and  experience.  Ample  space  should  be  left 
on  every  application  form  for  making  notes  as  to  the  individual'^ 
special  qualifications  as  well  as  any  other  circumstances  surrounding 


PERSONAL  RELATIONSHIP 


169 


the  case.  As  judgment  is  essential,  and  as  judgment  is  influenced 
by  immediate  impression,  in  this  establishment  no  one  is  employed 
on  the  date  of  application.  Postponement  of  selection  tends  to  bring 
all  applicants  in  their  proper  relationship  in  the  mind  of  one  who 
has  the  responsibility  of  their  selection.  This  method,  moreover, 
tends  to  reduce  the  number  of  floaters  who  otherwise  might  get  on 

the  pay  roll.  .      •.    \ 

Application  records  are  classified  as  to  sex,  age,  and  apparent  smt-  \ 
ability.  When  a  position  is  to  be  filled,  one  or  more  applicants  are 
sent  for.  A  definite  time  is  set  for  their  appearance,  and  self -addressed 
postal  cards  are  inclosed  to  be  mailed  in  case  appointments  cannot  be 
kept.  At  this  time  selection  is  made  for  immediate  employment,  and 
the  fitness  of  the  applicant  is  more  definitely  determined. 

As  a  rule,  in  industrial  establishments,  where  the  question  arises  at 
all,  only  fitness  for  the  work  is  consider^  There  are,  however,  two 
kindrSf^fitnesTtrr-bF-considered,  pro'vided  a  person  is  suited  for 
industry  at  all ;  one  is  fitness  for  the  position ;  the  other  is  fitness 
for  the  organization.  Of  these  the  latter  is  by  far  the  more  important. 

Fitness  for  the  organization  is  chiefly  a  question  of  character.  ^ 
Every  organization  has  a  distinct  character  of  its  own,  which  is  often 
recognized  as  being  a  tangible  business  asset.  It  is  essential,  there- 
fore, that  every  member  of  the  organization  have  a  character  suffi- 
ciently developed  or  capable  of  development  to  be  in  harmony  with 
the  character  of  the  organization.  This  is  the  basis  of  esprit  de  corps. 
No  matter  how  skilled  or  fitted  one  may  be  to  do  a  given  piece  of 
work,  if  he  is  out  of  harmony  with  the  spirit  or  character  of  the 
organization,  he  will  be  an  everlasting  detriment  to  himself  and  all 
others  in  the  organization  who  come  in  contact  with  him. 

The  interview  of  the  applicant  by  a  trained  head  of  the  Employ- 
ment and  Service  Department  is  the  basis  of  predetermining  as  far 
as  possible  both  the  fitness  for  a  position  and  for  the  organization. 
In  judging  fitness  for  a  position,  past  experience,  where  there  is  any, 
is  sometimes  a  guide.  At  the  best,  however,  it  is  a  guide  of  only 
doubtful  value.  Personal  choice  also  can  be  taken  in  some  instances 
as  a  guide.  This  predilection  furnishes  in  itself  a  valuable  incentive. 
Often,  however,  it  is  a  case  of  bringing  the  child  up  on  candy  because 
he  likes  it.  When  considered  at  all,  it  is  important  to  weigh  care- 
fully all  the  reasons  for  the  predilection. 


1; 


iMil 


f 


1 


170       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  applicant's  fitness  for  the  organization,  while  more  important, 
is  more  readily  predetermined  by  interview.  The  interview  at  the 
time  of  employment  is  very  thorough  and  designed  to  explain  to  the 
prospective  employee  the  character  of  the  organization  and  its  poli- 
cies, and  the  responsibilities  of  the  organization  to  the  employee  as 
well  as  the  responsibility  of  the  employee  to  the  organization. 

As  the  aim  of  the  Employment  and  Service  Department  is  to 
keep  every  position  in  the  organization  filled  with  fit  men  and  women, 
^^.ISH^^iis^-Q^  iitasical  and  mental  fitness  of  the  individual  is  of 
pdme  importa.nce.    For  the  physical  needs  at  the  Gothcraft  Shops 
a  complete  medical  department  is  maintained  as  part  of  the  Employ- 
ment and  Service  Department.   A  graduate  nurse  is  in  direct  charge 
of  this  work.    The  equipment  includes  a  dispensary,  separate  rest 
rooms,  a  waiting  room,  and  a  consultation  room  for  the  factory  physi- 
cians.   The  medical  staff  consists  of  a  physician,  an  oculist,  and  a 
dentist.    The  physician  is  at  the  factory  three  mornings  a  week,  the 
oculist  two  mornings,  and  the  dentist  one  morning.   All  medical 
work  done  at  the  factory  is  paid  for  by  the  company.    Outside  serv- 
ice of  the  factory  physician  is  furnished  to  employees  and  their 
families  at  special  rates,  except  in  instances  where  the  Employment 
and  Service  Department  recommends  treatment  at  the  company's 
expense.    In  order  to  facilitate  physical  examinations  required,  the 
time  of  taking  on  new  employees  is  being  regulated  so  as  to  coincide 
with  the  time  that  the  physician  spends  at  the  factory.    Physical 
examinations  of  all  members  of  the  organization  are  repeated  an- 
nually or  with  greater  frequency  if  there  is  cause. 

The  eye  examination  is  of  the  greatest  importance  in  considering 
applicants  for  certain  positions.  A  preliminary  examination  is  made 
by  the  nurse  in  order  to  discover  any  obvious  defects  of  vision.  Ar- 
rangements have  been  made  by  which,  in  case  the  oculist  later  pre- 
scribes glasses,  they  can  be  procured  from  a  first-class  optician  at 
half  the  regular  price.  One  of  the  greatest  obstacles  in  connection 
with  this  work  is  the  fact  that  many  people  who  are  in  need  of 
proper  glasses  have  had  glasses  supplied  to  them  by  optical  stores 
or  by  itinerant  vendors  without  the  advice  of  a  practicing  oculist. 
In  most  cases  the  trouble  has  only  been  aggravated.  The  benefits  of 
an  eye  examination  and  the  prescribing  of  proper  glasses  are  readily 
apparent.    In  one  case  a  young  woman  had  worn  the  same  glasses 


PERSONAL  RELATIONSHIP 


171 


for  a  number  of  years.  She  had  obtained  them  from  a  dealer  whose 
business  enterprise  included  the  sale  of  glasses  and  jewelry.  The 
young  woman  realized  thoroughly  that  her  eyesight  was  poor  and 
complained  constantly  of  eyestrain  and  headaches.  She  was  an 
employee  of  the  firm  for  a  number  of  years  and  had  always  been 
more  or  less  inefficient.  Examination  of  her  eyes  by  the  factory 
oculist  proved  not  only  that  her  eyesight  was  very  poor  but  that  the 
glasses  which  she  had  been  wearing  for  six  years  were  fitted  with 
nothing  but  plain  window  glass.  Fitting  her  with  proper  glasses  not 
only  entirely  eliminated  the  headaches,  but,  within  a  period  of  a 
few  weeks,  resulted  in  an  increase  in  efficiency  to  a  standard  equal 

to  the  best.  .  .  . 

Accidents  are  not  of  the  major  kind  in  the  clothing  mdustry, 
and  even  minor  accidents  have  been  practically  eliminated  at  the 
Clothcraft  Shops  by  a  thorough  systenw)f  safety  devices  and  in- 
struction.    There  are  naturally,  however,  a  number  of  cases  where 
fingers-nrc-pticked  in  handling  needles  or  where  other  minor  injuries 
are  incurred  either  away  from  or  at  work.    Ordinarily  these  things 
are  neglected  and  cause  a  great  deal  of  inconvenience  and  much  loss 
of  time  due  to  infections.    Instructions  are  given  that  no  one  should 
be  permitted  to  work  with  the  slightest  scratch  or  the  slightest  ache 
or  pain,  or  any  indication  whatever  of  illness,  without  consulting  the 
nurse.    This  has  not  only  cut  down  the  time  lost  from  infections  to 
almost  nil  but  has  also  made  it  possible  to  forestall  a  great  number 
of  incipient  cases  of  illness.    This  precautionary  measure,  together 
with  the  medical  work  in  general,  has  undoubtedly  been  the  means 
of  keeping  the  working  force  of  the  Clothcraft  Shops  absolutely 
free  from  all  epidemics  that  have  swept  through  the  community  in 

the  past  few  years.  . 

Only  one  who  has  gone  deeply  into  the  question  of  health  m  its 
relation  to  efficiency  can  realize  the  loss  occasioned  by  lack  of  knowl- 
edge and  attention  to  even  the  simplest  rules  of  hygiene.  A  great 
deal  of  work  is  constantly  required  to  educate  people  to  realize  the 
necessity  of  fresh  air,  proper  diet,  and  regular  hours,  lack  of  atten- 
tion to  one  or  all  of  which  is  often  the  cause  of  inefficiency.  What 
can  be  done  by  working  along  these  lines  is  well  illustrated  by  the 
following  cases.  At  the  time  medical  examinations  were  first  installed 
at  the  Clothcraft  Shops  five  young  women  were  selected,  all  having 


I 


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Mil 


liit^ 


172       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

been  on  the  same  operation  from  one  to  six  years.  These  five  had  a 
record  for  absence,  tardiness,  and  general  inefficiency  much  worse 
than  any  of  the  other  forty  or  fifty  on  the  same  operation.  It  was 
found  that  all  five  were  accustomed  to  sleeping  with  windows  closed 
at  night  and  took  no  outdoor  exercise  at  any  time.  All  neglected  the 
simple  rules  of  diet,  and  two  were  accustomed  to  hurry  away  from 
home  every  morning  without  breakfast.  One  was  found  to  be  in 
need  of  eyeglasses.  All  complained  of  not  feeling  fit  when  they 
came  to  work  in  the  morning  and  complained  constantly  of  head- 
aches and  a  general  debility,  which  naturally  resulted  in  much 
absence  from  work.  The  cases  were  interviewed  separately,  proper 
advice  was  given,  and  the  ultimate  results  of  irregularity  and  in- 
efficiency were  thoroughly  gone  into.  By  consistent  follow-up  the 
advice  was  soon  accepted  by  all,  with  the  result  that  tardiness  and 
absence  were  practically  eliminated  in  all  cases,  and  efficiency  was 
increased  from  20  to  50  per  cent. 

One  phase  of  this  work  is  worthy  of  special  mention.    No  one  who 
has  ever  been  in  actual  touch  with  the  men  and  women  of  an  in- 
dustrial organization  has  failed  to  run  across  the  case  of  the  man 
who  is  down  and  out  because  of  long  sickness  in  his  family.    Doctor's 
bills  and  bills  for  medicines  are  rapidly  getting  him  deeper  and 
deeper  in  debt,  or  he  may  be  brooding  over  what  he  thinks  to  be  the 
last  lingering  illness  of  one  of  his  family.    A  man  with  a  load  such 
as  this  can  seldom  hold  up  his  end  in  either  output  or  quaTRy.    In 
the>asrntmTbef  of  cases  an  investigation  will  show  that  his..troubles 
can  easily  be  alleviated.    He  is  often  the  prey  of  an  unscrupulous 
practitioner  or  some  fraudulent  fake  who  is  bleeding  the  family  for 
every  cent  that  it  can  scrape  together.    Very  often  the  family  is 
despairing  of  medical  assistance  and  is  found  to  be  squandering  a 
large  portion  of  its  income  on  fake  remedies  at  the  instigation  of  the 
ignorant  advice  of  neighbors  or  under  the  influence  of  the  advertis- 
ing carried  in  unscrupulous  newspapers.    The  prevalence  of  these 
conditions  is  of  such  amazing  extent  as  to  cry  for  public  atten- 
tion.   Unfortunately  medical  ethics  seems  too  unethical  to  deal  with 
the  situation.     By  reason  of  its  far-reaching  effect,  the  handling 
and  prevention  of  such  cases  must  be  considered  one  of  the  im^ 
portant  accomplishments  of  the  medical  service  of  the  Clothcraft 
Shops.  .  .  , 


PERSONAL  RELATIONSHIP 


173 


A  great  deal  has  been  said  and  written  about  psychological  tests 
for  thejmrpQse_of  selection,  but  the  little  that  lias  been  done  of 
p7actical  value  has  been  limited  almost  entirely  to  a  few  tests  for 
special  aptitudes  where  special  aptitudes  are  required.    For  the  pres- 
ent, at  least,  such  tests,  even  when  practically  developed,  can  be 
used  only  for  the  determination  of  individual  limitations.    At  the 
Clothcraft  Shops  investigations  and  experiments  have  been  carried 
on  for  this  purpose.    The  tests  that  are  being  developed  consist  of 
general-intelligence  tests,  including  a  test  for  ability  to  follow  in- 
structions and  a  series  of  tests  for  dexterity.    Professor  Walter  Dill 
Scott  of  Northwestern  University  has  been  retained  for  the  purpose 
of  assisting  in  the  development  of  these  tests.    Recently  a  series  of 
tests  were  given  under  his  direction  with  the  assistance  of  Professor 
Henry  A.  Seager  of  Columbia  University.    Twenty-one  subjects  were 
chosen  for  the  purpose  and  included  members  of  the  organization 
holding  executive  positions  and  operatives  of  different  degrees  of 
efficiency  in  various  kinds  of  work.    In  practically  every  case  the 
results  of  the  tests  checked  up  accurately  with  the  estimate  of  general 
intelligence  and  dexterity  based  on  records  and  personal  acquaintance 
over  a  long  period  of  time. 

The  object  of  these  tests  is  twofold.  In^the  fir^^t  place,  with  the 
best  of  care  errors  are  bound  to  occur  in  original  selection  and 
placemehl.  Pfupfe"are  often  placed  on  work  for  which  they  are  not 
amr  suited,  and  some  are  occasionally  selected  who  are  mentally 
unfit  for  the  industry.  This  under  no  circumstances  means  that  all 
the  mentally  deficient  are  unfit.  There  are,  of  course,  all  kinds  of 
mental  deficients,  and  there  are  a  great  many  different  kinds  of  work 
in  most  industrial  establishments  that  can  be  done  as  efficiently  by 
the  mentally  subnormal  as  by  the  normal.  The  human  make-up 
is  so  complex  that  many  instances  have  been  found  where  a  normal 
individual  was  incapable  of  reaching  the  same  efficiency  in  certain 
kinds  of  work  as  a  subnormal  had  reached. 

Several  cases  were  taken  at  the  Clothcraft  Shops  of  people  who 
were  apparently  deficient  mentally.  A  series  of  tests  was  made  by 
the  Binet  method  in  order  to  confirm  this  conviction  and  in  order  to 
get  an  approximate  rating  of  their  mental  capacity.  In  most  instances 
one  who  has  not  had  intimate  acquaintance  with  individual  cases  over 
a  long  period  of  time  would  not  suspect  any  mental  deficiency.    A 


m 


I:, 


174       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

case  in  point  is  that  of  a  girl  who  had  been  in  the  employ  of  the 
firm  for  about  four  years.    Being  employed  rather  young,  she  was 
put  on  an  operation  of  the  simplest  kind.   While  on  this  operation 
she  became  very  efficient.    The  result  was  that  she  was  advanced 
and  for  another  year  was  tried  on  various  operations  without  being 
able  to  make  good.    By  this  time  everybody  had  become  more  or 
less  disgusted  with  IVIary  at  home  and  at  the  factory,  and  Mary  quit 
to  find  other  work.    She  returned  in  a  few  months,  and  as  her  spirit 
was  good  it  was  decided  to  give  her  another  trial  at  machine  work. 
Mary  utterly  failed  to  progress  in  spite  of  her  apparent  best  efforts 
and  the  special  attention  given  her  for  the  purpose.    It  was  then 
decided  to  try  her  at  an  operation  where  she  was  required  to  follow 
certain  lines  of  the  garments,  trimming  off  surplus  goods  with  hand 
shears— an  operation  that  is  simple  from  the  point  of  view  of  the 
dexterity  and  intelligence  required.  Mary  immediately  began  to  make 
progress,  and  her  earnings  are  averaging  with  the  best.    This  is  a 
typical  case  showing  the  waste  of  time  and  effort  which  it  is  hoped 
will  be  minimized  with  the  assistance  of  tests.    It  is  the  aim  to  use 
the  tests  as  an  aid  in  selection,  to  avoid  placing  people  who  are 
either  normal  or  subnormal  on  kinds  of  work  for  which  they  are  very 
likely  to  prove  unfit. 

The  purpose  of  these  tests  in  the  second  place  is  somewhat  differ- 
ent,  but  Ills  ot  very  great  Impo"rlanc6  In  an  organization  such  as  that 
of  the  Clothcraft  Shops.  It  is  the  practice  of  this  organization  to  fill 
positions  of  clerical  or  executive  nature,  and  in  fact  all  better  posi- 
tions of  any  kind,  by  advancement.  By  this  method  a  considerable 
percentage  of  the  organization  is  moved  up  during  a  year's  time. 
At  the  best  a  large  number  of  mistakes  have  been  made  by  advancing 
individuals  to  positions  beyond  their  capacity.  This,  of  course,  in- 
volves eventually  a  reduction  in  position  or  loss  of  the  individual  to 
the  organization.  In  any  case  the  organization  has  suffered  by  a 
position  pooriy  filled,  and  the  individual  as  well  as  those  responsible 
for  his  training,  has  gone  through  a  period  of  discouragement  which 
often  leaves  a  permanent  effect.  It  is  hoped  by  means  of  these  tests 
to  minimize  these  errors.  .  . 

Whenever  possible  the  workers  should  be  trained  to  perform  more 
than  one  kind  of  work.  In  this  way  they  can  be  used  to  help  out 
in  cases  of  emergency,  some  of  which  occur  daily  in  every  large 


PERSONAL  RELATIONSHIP 


175 


establishment  because  of  absences  or  other  reasons.    In  the  Clothcraft 
Shops  all  those  willing  to  learn  other  work  are  given  opportunity  to 
do  so  and  are  paid  a  retainer  while  learning.    All  employees  who  are 
capable  of  helping  out  on  an  operation  are  carefully  listed,  and  a 
definite  hourly  retainer  is  paid  them  whenever  they  do  work  on  which 
they  are  not  able  to  earn  as  much  as  on  their  regular  operation.    At 
all  times  the  normal  working  force  should  be  maintained,  except 
only  under  such  conditions  as  are  forced  upon  the  industry  and 
beyond  its  control.    Where  there  is  a  temporary  lack  of  orders,  due 
to  industrial   depression,  seasonal   fluctuations,   and   the  like,   the 
number  of  employees  should  not  be  cut  down,  but  the  number 
of  hours   of   employment   should  be   reduced   equally    throughout 
the  whole  organization.     At  the  Clothcraft  Shops  this  policy  was 
strictly  adhered  to  during  the  recent  industrial  depression,  which 
reduced  its  normal  working  hours  by  approximately   15  per  cent 
for  a  period  of  six  months.    While  the  percentage  of  quitters  for  this 
period  was  noticeably  increased,  nevertheless  this  increase  was  dimin- 
utive as  compared  to  the  number  it  would  have  been  necessary  to 
lay  off  had  another  policy  been  followed.  We  believe,  moreover,  the 
duty  of  providing  steady  employment  under  all  possible  conditions 
is  a  moral  responsibility  to  the  community  at  large. 

The  seasonal  character  of  some  industries  is  a  well -recognized  ^ 
part  of  this  problem.  There  is  no  doubt  that  in  order  to  overcome 
this  obstacle  a  great  deal  of  public  education  is  necessary.  The  fact 
remains,  however,  that  the  problem  can  for  the  greater  part  be 
solved  by  the  industry  itself.  For  this  purpose  purchases  must  be 
standardized  and  the  purchasing  policy  itself  so  developed  that  a 
good  proportion  of  orders  can  be  anticipated. 

In  this  connection  one  of  the  most  important  things  is  the  sales  \ 
policy.  Many  businesses,  even  though  having  a  highly  developed 
manufacturing  organization,  have  not  a  sales  policy  or  sales  organi- 
zation worthy  of  the  name.  It  is  only  in  exceptional  instances  that 
the  sales  policy  and  the  manufacturing  policy  are  property  correlated. 
Ordinarily  the  sales  department  is  administered  with  entire  disregard 
of  its  most  important  function,  viz.,  to  market  a  product  that  will 
permanently  be  of  most  profit  to  the  entire  organization.  The  Joseph 
and  Feiss  Company,  in  order  to  meet  the  problem  of  furnishing  steady 
employment,  have  for  some  time  past  conducted  an  advertising 


Mi 


Ill' 


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i  j. 


176       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

campaign  concentrating  on  certain  staple  numbers.  I'he  volume  of 
sales  that  has  resulted  has  been  sufficient  under  normal  conditions  to 
provide  steady  employment  when  other  establishments  in  the  same 
industry  have  been  shut  down.  As  to  this  phase  of  the  problem, 
however,  the  surface  has,  as  yet,  only  been  scratched.  The  men  who 
hold  the  purse  strings  must  sooner  or  later  learn  that  the  correct 
point  of  view,  both  morally  and  for  the  purpose  of  permanent  return 
not  only  to  themselves  but  to  all  the  organization,  involves  the  reali- 
zation that  the  factory  does  not  exist  for  the  purpose  of  turning  out 
for  a  temporary  profit  whatever  it  is  easiest  to  sell,  but  that  the  sales 
force  is  part  of  the  manufacturing  organization  to  market  whatever 
it  can  most  steadily  and,  therefore,  most  profitably  produce. 

From  the  record  of  absentees  and  tardies  it  is  shown  that  during 
the  first  six  months  of  191 5  the  average  number  of  tardies  was  only 
two  and  one-half  persons  per  day.  This  is  equal  to  one  third  of  i 
per  cent  of  the  working  force.  For  purposes  of  accurate  follow-up, 
absences  are  classified  as  excusable  and  inexcusable.  The  excusable 
absences  averaged  a  little  over  seven  persons  per  day,  or  nine  tenths 
of  I  per  cent  of  the  working  force.  The  inexcusable  absences 
averaged  only  a  little  less  than  four  per  day,  or  five  tenths  of 
I  per  cent.  The  total  absentees  per  day  averaged  eleven,  or  only 
1.4  per  cent. 

In  regard  to  quitters  a  little  more  explanation  is  necessary.  Very 
few  people  realize  the  tremendous  cost  to  industry  from  this  cause. 
Various  estimates  of  this  cost  have  been  made.  These  estimates  vary 
from  $50  to  $200  per  person,  depending  on  the  nature  of  the  work 
and  character  of  employee  obtainable  and  the  percentage  of  old 
employees  who  are  rehired.  Taking  even  the  lowest  possible  esti- 
mate, it  would  seem  that  any  reasonable  outlay  of  both  money  and 
effort  for  the  purpose  of  reducing  this  industrial  and  social  waste 
would  be  justifiable.  At  the  Clothcraft  Shops,  in  recognition  of  the 
tremendous  loss  from  this  source  and  the  consequent  value  of  notice 
in  case  of  a  contemplated  severance  from  the  organization,  such 
notice  is  paid  for  at  the  rate  of  an  amount  equal  to  a  day's  pay  for 
every  week's  notice,  but  not  in  any  case  to  exceed  an  amount  greater 
than  four  days'  pay.  .  .  . 

Nothing  shows  more  cleariy  the  progress  which  has  been  made 
in  this  respect  at  the  Clothcraft  Shops  than  the  record  of  ^' labor 


PERSONAL  RELATIONSHIP  i?? 

turnover"  for  the  five  years  from  19 10  to  19 14  inclusive,  as  sho\vn 


in  Table 

I. 

Table  i. 

Labor  Turnover,  1910-1914 

Year 

Stand.  Pay  Roll 

New  Hands 

Per  Cent 

IQIO 

1044 

951 

887 

874 
865 

1570 
807 

663 

569 
291 

150-3 

lOI  I 

84.8 

f  01  2               

747 

1  C\J  1                  ....... 

65.1 

I9H 

33-5 

These  records  tell  their  own  story.  It  may  be  also  worthy  of  note 
that  over  one  third  of  the  members  of  the  Clothcraft  organization 
have  been  in  the  continuous  employ  of  the  company  for  a  period  of 
five  years  or  more.  It  is  practically  impossible  to  obtain  accurate 
figures  as  to  normal  labor  turnover.  In  the  few  instances  where 
figures  are  available,  progress  has  already  been  made.  In  the  case 
of  one  large  concern,  in  the  men's  clothing  industry,  the  number  of 
people  employed  for  1914  amounted  to  115  per  cent  of  the  pay  roll, 
which  is  undoubtedly  better  than  the  average  in  the  industry.  The 
following  relating  to  a  somewhat  similar  industry  is  from  the  report  of 
the  Federal  Industrial  Relations  Commission  (page  166): 

An  investigation  of  the  cloak  and  suit  industry  in  New  York 
showed  the  maximum  number  of  employees  in  sixteen  occupations 
during  any  week  of  the  year  to  be  1952.  Actually,  however, 
the  pay  rolls  showed  that  4000  people  were  employed  m  these 
occupations.  .  .  . 

The  open  road  to  talent  is  an  essential  to  every  successful  organi- 
zation. At  the  Clothcraft  Shops  the  road  is  not  only  open  but  every 
possible  aid  is  given  for  advancement.  Practically  all  positions  in 
the  organization,  including  clerical  and  executive  positions,  are  filled 
by  those  who  by  reason  of  sheer  personal  merit  have  come  up  from 

the  ranks. 

One  of  the  most  important  functions  of  the  Employment  and 
Service  Department  is  to  develop  organization  spirit  and  free  ex- 
pression of  personal  and  public  opinion.  It  forms  a  direct  channel 
of  expression  from  its  source  to  the  ear  of  the  management.  In  fact 
the  chief  purpose  of  a  scientifically  organized  department  is  nothing 


1: 


Ml 


;     ! 


J:: 


H 


q; 


\ 


178       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

more  than  the  development  of  that  intimate  personal  contact  so 
necessary  to  management.  At  the  Clothcraft  Shops  about  one  fifth 
of  the  total  number  of  employees  come  daily  in  contact  with  the 
Employment  and  Service  Department.  All  cases  where  direct  contact 
with  the  management  would  be  beneficial  are  immediately  referred  to 
it.  This  requires  constant  daily  contact  of  the  management  with  the 
department,  and  brings  it  into  intimate  relationship  with  a  great 
many  more  cases  than  would  be  possible  in  the  average  organization 
of  much  smaller  size.  Wherever  the  management  assumes  the  policy 
of  the  closed  door,  this  department  may  well  be  shut  down. 

Results  cannot  be  accomplished  in  the  spirit  of  charity,  but  must 
emanate  entirely  from  a  sense  of  justice.  It  must  be  understood  that 
work  along  the  lines  described  above  can  never  take  the  place  of 
wages.  Such  work  must  have  as  a  reason  for  its  existence  not  only 
increased  efficiency  but  the  increased  reward  to  which  increased 
efficiency  is  entitled.  The  progress  of  the  Clothcraft  Shops  in  respect 
to  wages  and  efficiency  from  June,  1910,  to  January,  191 5,  is  shown 
by  an  increase  in  production  of  42  per  cent ;  an  increase  in  the  aver- 
age individual  hourly  wages  of  45  per  cent,  weekly  wages  37  per 
cent ;  and  a  decrease  in  total  manufacturing  cost  of  about  10  per 
cent.  During  this  period  the  weekly  working  schedule  was  reduced 
from  fifty-four  to  forty-eight  hours. 

It  is  our  belief  that  results,  such  as  these,  are  obtainable  only 
when  scientific  management  is  scientifically  applied.  Scientific  man- 
agement will  live  if  for  no  other  reason  than  that  it  has  faced  the 
problem  squarely  and  recognizes  that  the  science  of  management  is 
the  science  of  handling  men. 

Richard  A.  Feiss 


XIV 

SCIENTIFIC  MANAGEMENT  AND  DICTATORSHIP 

OF  THE  PROLETARIAT  ' 

THANKS  to  the  peace  obtained,— in  spite  of  its  oppressiveness 
and  all  its  insecurity,  —  the  Russian  Soviet  Republic  is  en- 
abled for  a  certain  time  to  concentrate  its  efforts  on  the  most  im- 
portant and  most  difficult  side  of  the  socialist  revolution,  the  problem 
of  organization. 

This  problem  is  presented  clearly  and  precisely  to  the  masses  in 
the  fourth  section  of  the  resolution  adopted  at  the  extraordinary  con- 
gress of  the  Soviets  held  at  Moscow  on  March  16,  19 16,  the  section 
which  urges  self-discipline  of  the  workers  and  a  merciless  struggle 
against  chaos  and  disorganization.  .  .  . 

In  every  socialist  revolution — and  hence  also  in  the  socialist  revo- 
lution in  Russia  inaugurated  by  us  on  November  7,  1917,"— the 
main  task  of  the  proletariat  and  of  the  poorest  peasantry  led  by 
it  consists  in  the  positive  and  constructive  work  of  establishing 
an  extremely  complex  and  delicate  net  of  newly  organized  relation- 
ships covering  the  systematic  production  and  distribution  of  prod- 
ucts which  are  necessary  for  the  existence  of  tens  of  millions  of 
people.    The  successful  realization  of  such  a  revolution  depends  on 

1  Extracts  from  address  by  Nikolai  Lenin,  Russian  Communist  Premier,  in 
June,  191Q,  forecasting  the  decrees  of  the  Bolshevik  government  issued  the 
following  February.  As  a  result  of  the  confiscation  of  factories  without  compen- 
sation to  the  owners,  resulting  in  destruction  of  credit  and  the  breakdown  of 
discipline,  Lenin  announced  in  this  speech  the  resort  to  compulsory  labor  in  fac- 
tories, the  dictatorship  of  industry  by  the  leaders  of  the  communist  army,  a 
proposed  introduction  of  scientific  management,  and  the  desperate  predicament 
that  followed  the  expulsion  of  business  management  and  the  attempt  of  the 
Soviets  to  operate  the  factories.  (See  Introduction,  p.  x.)  Translated  for 
the  Rand  School  of  Social  Science. 

2  November  7,  191 7,  is  the  date  of  the  successful  Bolshevik  coup  d'etat. 
The  Kcrcnsky  coalition  government  was  forced  to  abdicate  on  that  day,  and 
the  Soviet  government,  with  the  Bolshevik  leaders,  Nikolai  Lenin  and  Leon 
Trotsky,  at  the  helm,  was  instituted  in  its  place. 

179 


in 


''^' 


If  If  rirar 


1 80      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  original  historical  creative  work  of  the  majority  of  the  population, 
and  first  of  all  of  the  majority  of  the  toilers.  The  victory  of  the 
socialist  revolution  will  not  be  assured  unless  the  proletariat  and  the 
poorest  peasantry  manifest  sufficient  consciousness,  idealism,  self- 
sacrifice,  and  persistence.  With  the  creation  of  a  new  type  of  state, 
—  the  Soviet,— offering  to  the  oppressed  toiling  masses  the  oppor- 
tunity to  participate  actively  in  the  free  construction  of  a  new 
society,  we  have  solved  only  a  small  part  of  the  difficult  task.  The 
main  difficulty  is  in  the  economic  domain  :  to  raise  the  productivity  of 
labor,  to  establish  strict  and  uniform  state  accounting  and  control  of 
production  and  distribution,  and  actually  to  socialize  production.  .  .  . 
We  are  now  confronted  by  the  third  problem,  which  is  the  most 
urgent  and  which  characterizes  the  present  period  —  the  industrial 
organization  of  Russia.  We  had  to  deal  with  it  and  have  been 
solving  it  ever  since  November  7,  191 7.  But  heretofore,  as  long  as 
the  resistance  of  the  exploiters  manifested  itself  in  open  civil  war- 
fare, the  problem  of  management  could  not  become  the  principal, 
the  central,  problem. 

At  present  it  has  become  the  central  problem.  We,  the  Bolshevik 
party,  have  convinced  Russia.  We  have  won  Russia  from  the  rich 
for  the  poor,  from  the  exploiters  for  the  toilers.  And  now  it  is  our 
task  to  manage  Russia.  The  special  difficulty  of  the  present  period 
consists  in  understanding  the  peculiarities  of  the  transition  from  the 
problem  of  convincing  the  people  and  suppressing  the  exploiters  by 
force  to  the  problem  of  management.  .  .  . 

"Keep  accurate  and  conscientious  accounts;  conduct  business 
economically;  do  not  loaf;  do  not  steal;  maintain  strict  disci- 
pline at  work."  These  slogans,  which  were  justly  ridiculed  by  revo- 
lutionary proletarians  when  they  were  used  by  the  bourgeoisie  to 
cover  its  domination  as  a  class  of  exploiters,  have  now,  after  the 
overthrow  of  the  bourgeoisie,  become  our  urgent  and  principal  slo- 
gans. On  the  one  hand,  the  practical  realization  of  these  slogans  by 
the  toiling  masses  is  the  sole  condition  for  the  salvation  of  the 
country,  .  .  .  and,  on  the  other  hand,  the  practical  realization  of 
these  slogans  by  the  Soviet  power,  with  its  methods,  and  on  the 
basis  of  its  laws,  is  necessary  and  sufficient  for  the  final  victory  of  so- 
cialism. This,  however,  is  not  comprehended  by  those  who  contemp- 
tuously refuse  to  urge  such  "  common  "  and  "  trivial "  slogans.    In  our 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        181 

agricultural  country,  which  only  a  year  ago  overthrew  czarism  and  less 
Zn  half  a  year  ago  freed  itself  from  the  ^e-skys  there  r^^^^ 
naturally,  a  good  deal  of  unconscious  anarchism,  which  is  increased 
by  the  b  stiality  and  barbarity  accompanying  every  prolonged  and 
reactionary  war' and  a  good  deal  of  despair  and  a^-less  anger  ha 
accumulated.   H  we  should  add  to  this  the  t™ab\pol.^^^^^^^^^ 
servants  of  the  bourgeoisie- the  Mensheviks,  the  ^^^f'^^^'^^^ 
of  the  Right,  etc.-it  will  become  clear  that  energetic  and  persistent 
efforts  must  be  exerted  by  the  best  and  most  conscious  workers  and 
pe  ants  to  effect  a  complete  change  in  the  mood  oj.  the  masses  and 
to  turn  them  to  a  regular,  uninterrupted,  and  ^--P^^^f  ^  ^J^J' 
Onlv  such  a  change  accomplished  by  the  masses  of  proletarians 
S  near  proletarians  can  complete  the  victory  over  the  bourgeoisie 
and  especially   over   the   more   persistent   and   numerous   peasant 

'TdtS;;  'importance  is  the  organization  of  strict  and  uniform 
accounting  and  control  of  production  and  distribution.  But  we 
have  not  ^et  effected  accounting  and  control  in  those  enterprises  and 
in  those  branches  and  departments  of  economic  effort  which  we  have 
taken  away  from  the  bourgeoisie.  Without  this  there  can  be  no 
question  of  the  second  condition,  just  as  essential  to  the  establish- 
Tnt  of  socialism;  that  is,  the  increase  of  the  productivity  of  labor 

on  a  national  scale.  ...  •  »•       „f  tv,„  <>■, 

Heretofore  measures  for  the  immediate  expropriation  of  the  ex- 
propriators were  preeminent.   At  present  preeminence  """^t  ^e  gwen 
to  L  organization  of  accounting  and  control  m    h°se  enterpns^ 
in  which  the  capitalists  have  already  been  expropnated    W  re  we  to 
attempt  now  to  continue  the  expropriation  of  capital  at  the  same 
r^e  as  heretofore,  we  would  surely  be  defeated.   It  is  clear  to  every 
hnking  person  tLat  our  work  of  organizing  proletarian  accounting 
and    ontrol  has  not  kept  pace  with  the  work  of  the  direct^^ro- 
nriation  of  the  expropriators.    If  we  now  turn  al    our  efforts  to 
^    aSng  accoun'ng'and  control    we  shall  be  able  to  so  ve    h^s 
problem ;  we  shall  overcome  our  shortcomings  and  win  our    cam 

Te\rte?Su"ntiy  "reproached  by  the  servants  of  the 
bourgeois  for  conducting  a  "Red  Guard"  attack  on  capitalism.  An 
absurd  reproach,  worthy  indeed  of  servants  of  the  money  pouch  I 


1! 


tl: 


I 


III 


w. 


182       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  "  Red  Guard  "  attack  on  capitalism  was  at  that  time  absolutely 
dictated  by  the  circumstances.  First,  capitalists  were  offering  military 
resistance  through  Kerensky  and  Kransnov,  Savinkov  and  Goltz 
(Gegechkori  is  even  now  offering  such  resistance),  Dutov  and  Boga- 
jevsky/  Military  resistance  can  be  crushed  only  by  military  means, 
and  the  "Red  Guards"  were  contributing  to  the  noblest  and  greatest 
cause  in  history,  the  cause  of  emancipation  of  the  exploited  toilers 
from  the  oppression  of  the  exploiters. 

Secondly,  we  could  not  then  give  preeminence  to  the  method  of 
management  instead  of  the  methods  of  suppression,  because  the  art  of 
management  is  not  inherent  in  people  but  is  gained  through  experi- 
ence. At  that  time  we  did  not  have  this  experience.  We  have  it  now ! 
Thirdly,  then  we  could  not  have  at  our  disposal  specialists  in 
different  branches  of  science,  for  they  were  either  fighting  in  the 
ranks  of  the  Bogajevskys  or  were  still  in  a  position  to  offer  systematic 
and  persistent  passive  resistance  through  sabotage. 

Does  this  mean  that  the  ''Red  Guard"  attack  on  capital  is  the 
right  method  always  in  all  circumstances,  and  that  we  have  no  other 
methods  of  combating  capitalism  ?  To  think  so  would  be  too  naive. 
We  have  won  with  light  cavalry,  but  we  also  have  heavy  artillery 
at  our  disposal.  We  have  been  winning  by  methods  of  suppression  ; 
we  will  be  able  to  win  also  by  methods  of  management.  We 
should  be  able  to  change  the  methods  of  fighting  with  the  change 
of  circumstances.  We  do  not  for  a  moment  reject  the  "Red  Guard" 
suppression  of  the  Savinkovs  and  Gegechkoris  as  well  as  of  any 
other  bourgeois  counter-revolutionists ;  but  we  will  not  be  so  stupid 
as  to  give  preeminence  to  the  "  Red  Guard  "  methods. 

At  present,  when  the  epoch  of  "  Red  Guard "  attacks  is  in  the 
main  completed  (and  completed  victoriously),  it  is  becoming  urgent 
for  the  proletarian  state  authority  to  make  use  of  the  bourgeois  spe- 
cialists for  the  purpose  of  replowing  the  soil  so  that  no  bourgeoisie 
can  grow  on  it. 

This  is  a  peculiar  stage  of  development,  and  in  order  definitely 
to  defeat  capitalism  we  should  be  able  to  adapt  the  forms  of  our 
struggle  to  the  peculiar  conditions  of  such  a  period. 

^  1  Persons  representing  bourgeois  counter-revolutionary  elements,  and  social- 
ist groups  actively  opposing  the  Bolsheviks  and  direcUy  or  indirectly  aiding  the 
counter-revolutionists. 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        183 

Without  the  direction  of  specialists  in  different  branches  of  science, 
such  as  technical  men,  the  transformation  toward  socialism  is  im- 
possible, for  socialism  demands  a  conscious  mass  movement  toward 
a  comparatively  higher  productivity  of  labor  on  the  basis  which  has 
been  attained  by  capitalism.    Socialism  must  accomplish  this  move- 
ment forward  in  its  own  way,  by  its  own  methods  ;  to  make  it  more 
definite— by   Soviet   methods.    But   the  specialists   are  inevitably 
bourgeois,  on  account  of  the  whole  environment  of  social  life  which 
made  them  specialists.    If  our  proletariat,  having  obtained  power, 
had  rapidly  solved  the  problem  of  accounting,  control,  and  orgam- 
zation  on  a  national  scale  (this  was  impossible  on  account  of  the 
war  and  the  backwardness  of  Russia),  then  having  crushed  the 
sabotage  of  the  capitalists,  we  would  have  obtained,  through  uniform 
accounting  and  control,  the  complete  submission  of  the  bourgeois 
specialists.   In  view  of  the  considerable  delay  in  establishing  ac- 
counting and  control,  although  we  have  succeeded  in  defeating  sabo- 
tage  we  have  not  yet  created  an  environment  which  would  put  at 
our  disposal  the  bourgeois  specialists.   Many  saboteurs  are  coming 
into  our  service,  but  the  best  organizers  and  the  biggest  specialists 
can  be  used  by  the  state  either  in  the  old  bourgeois  way  (that  is, 
for  a  higher  salar>0   or  in  the  new  proletarian  way   (that  is,  by 
creating  such  an  environment  of  uniform  accounting  and  control 
as  would  inevitably  and  naturally  attract  and  gain  the  submission 
of  specialists).   We  are  forced  now  to  make  use  of  the  old  bour- 
geois method  and  to  agree  to  a  very  high  remuneration  for  the  serv- 
ices of  the  biggest  of  the  bourgeois  specialists.   All  those  who  are 
acquainted  with  the  facts  understand  this,  but  not  all  give  sufficient 
thought  to  the  significance  of  such  a  measure  on  the  part  of  the 
proletarian  state.    It  is  clear  that  such  a  measure  is  a  compromise, 
that  it  is  a  defection  from  the  principles  of  the  Paris  Commune  and 
of  any  proletarian  rule,  which  demand  the  reduction  of  salaries  to 
the  standard  of  remuneration  of  the  average  workers— principles 
which  demand  that  "  career  hunting  "  be  fought  by  deed,  not  by  words. 
Furthermore,  it  is  clear  that  such  a  measure  is  not  merely  a  halt, 
in  a  certain  part  and  to  a  certain  degree,  of  the  offensive  against  capi- 
talism (for  capitalism  is  not  a  quantity  of  money  but  a  definite 
social  relationship)  but  also  a  step  backward  by  our  socialist  Soviet 
state,  which  has  from  the  very  beginning  proclaimed  and  carried  on 


I-' 


I 


I  iff  Iff 

'  !  Ii  mHBf 


184       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

a  policy  of  reducing  high  salaries  to  the  standard  of  wages  of  the 
average  worker. 

Of  course  the  lackeys  of  the  bourgeoisie,  particularly  of  the  petty 
kind,  like  the  Mensheviks  and  the  Social-Revolutionists  of  the 
Right,  will  sneer  at  our  admission  that  we  are  taking  a  step  back- 
ward. But  we  should  pay  no  attention  to  sneers.  We  must  study 
the  peculiarities  of  the  highly  difficult  and  new  road  to  socialism 
without  concealing  our  mistakes  and  weaknesses.  We  must  try  to 
overcome  our  deficiencies  in  time.  To  conceal  from  the  masses  that 
attracting  bourgeois  specialists  by  extremely  high  salaries  is  a 
defection  from  the  principles  of  the  Commune  would  mean  that  we 
had  lowered  ourselves  to  the  level  of  bourgeois  politicians  who  rule 
by  practicing  deception.  To  explain  openly  how  and  why  we  have 
taken  a  step  backward,  and  then  to  discuss  publicly  ways  and  means 
to  overcome  our  deficiencies,  is  to  educate  the  masses  and  to  learn 
from  experience — to  learn  together  with  them  how  to  build  socialism. 
There  has  hardly  been  a  single  military  campaign  in  history  in  which 
the  victor  has  not  made  mistakes,  suffered  partial  defeats,  and  tem- 
porarily retreated  at  some  time.  And  the  "campaign"  against  cap- 
italism which  we  have  undertaken  is  a  million  times  more  difficult 
than  the  most  difficult  military  campaign,  and  it  would  be  foolish 
and  disgraceful  to  become  dejected  on  account  of  a  temporary  and 
partial  retreat. 

Let  us  take  up  the  question  from  the  practical  side.  Let  us  as- 
sume that  the  Russian  Soviet  Republic  must  have  a  thousand  first- 
class  scientists  and  specialists,  of  recognized  skill  and  with  practical 
experience  in  different  departments  of  science,  to  direct  the  work  of 
the  people  in  order  to  accomplish  most  quickly  the  economic  reha- 
bilitation of  the  country.  Let  us  assume  that  these  great  "stars" 
must  be  paid  25,000  rubles  each  per  annum.  Let  us  assume  that 
this  sum  just  be  doubled  (supposing  premiums  to  be  granted  for 
particularly  successful  and  rapid  accomplishment  of  the  most  im- 
portant tasks  of  organization  and  technic)  or  even  made  four  times 
as  large  (supposing  that  we  must  get  several  hundred  better-paid 
foreign  specialists).  Well,  then,  can  this  expenditure  of  50,000,000 
or  100,000,000  rubles  a  year  for  the  reorganization  of  the  work  of 
the  people  along  the  lines  of  the  latest  scientific  developments  be 
considered  excessive  or  unbearable   for  the   Soviet   Republic?    Of 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        185 

course  not.   The  vast   majority   of   the   enlightened  workers   and 
peasants  will  approve  such  an  expenditure,  knowing  from  practical 
life  that  our  backwardness  compels  us  to  lose  billions,  and  that  we 
have  not  yet  attained  such  a  high  degree  of  organization,  accountmg, 
and  control  as  would  cause  the  universal  and  voluntary  partici- 
pation of  these  -stars"  of  the  bourgeois  intelligentzia^  in  our  work. 
Of  course  there  is  another  side  to  this  question.   The  corrupting 
influence  of  high  salaries  is  beyond  dispute-both  on  the  Soviets 
(the  more  so  since  the  swiftness  of  the  revolution  made  it  possible 
for  a  certain  number  of  adventurers  and  thieves  to  join  the  Soviets, 
who,  together  with  the  incapable  and  dishonest  among  certain  com- 
missaries, would  not  object  to  becoming  "star  grafters'  )  and  on  the 
mass  of  workers.    But  all  thinking  and  honest  workers  and  peasants 
will  agree  with  us  and  will  admit  that  we  are  unable  to  get  rid  at 
once  of  the  evil  heritage  of  capitalism ;   that  the  Soviet  Republic 
can  be  freed  from  a  tribute  of  50,000,000  or  100,000,000  rubles 
(a  tribute  for  our  own  backwardness  in  the  organization  of  account- 
ing and  control  from  the  bottom  up)  only  by  organization,  by  in- 
creasing discipline  among  ourselves,  by  getting  rid  of  all  those  who 
<^keep  the  traditions  of  capitalism,"  that  is,  the  loafers,  parasites, 
and  grafters    If  the  enlightened  and  advanced  workers  and  peasants 
succeed,  with  the  help  of  the  Soviet  institutions,  in  orgamzing  and 
disciplining  themselves  and  in  creating  a  powerful  labor  discipline  in 
one  vear,  then  we  will  in  one  year  do  away  with  this     tribute 
(which  may  be  reduced  even  earlier),  depending  on  the  measure  of 
success  attained  in  creating  labor  discipline  and  organization  among 
the  workers  and  peasants.    The  sooner  we  ourselves,  workers  and 
peasants,  learn  better  labor  discipline  and  a  higher  technic  of  toil, 
making  use  of  the  bourgeois  specialists  for  this  purpose,  the  sooner 
we  will  get  rid  of  the  need  of  paying  tribute  to  these  specialists.      ^ 

Our  work  of  organization,  under  the  direction  of  the  proletariat, 
of  state  accounting  and  control  of  production  and  distribution  is 
considerably  behind  our  work  of  direct  expropriation  of  the  ex- 
propriators. We  understand  this  is  fundamentally  necessary  for 
understanding  the  peculiarities  of  the  present  period  and  of  the 
problems  dictated  by  these  to  the  Soviets.  The  center  of  gravity 
of  the  struggle  with  the  bourgeoisie  is  shifted  to  the  organization  of 
1  Middle-class  intellectuals  form  a  separate  entity  in  Russian  society. 


I;  ■' 


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1 86       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

accounting  and  control.  This  must  be  taken  into  account  in  order  to 
determine  correctly  the  urgent  economic  and  financial  problems  con- 
cerning the  nationalization  of  banks,  monopolization  of  foreign  trade 
state  control  of  currency,  the  introduction  of  a  satisfactory  wealth 
and  income  tax  from  the  proletarian  standpoint,  and  the  introduction 
of  obligatory  labor  service. 

We  are  extremely  backward  in  regard  to  socialist  reforms  in  these 
fields  (and  they  are  very  important  fields),  and  we  are  backward  for 
no  other  reason  than  this— that  accounting  and  control,  in  general, 
are  not  sufficiently  organized.  Of  course  this  problem  is  one  of  the 
most  difficult,  and  with  the  economic  disorganization  produced  by 
the  war  its  solution  must  take  a  long  time,  and  it  should  not  be 
overlooked  that  just  here  the  bourgeoisie  (and  especially  the  numer- 
ous petty  and  peasant  bourgeoisie)  give  us  a  good  deal  of  trouble, 
disturbing  the  establishment  of  control— disturbing,  for  instance' 
the  grain  monopoly,  gaining  opportunities  for  speculation  and  specu- 
lative trade.  What  we  have  already  decreed  is  yet  far  from  adequate 
realization,  and  the  main  problem  of  today  consists  precisely  in  con- 
centrating all  efforts  upon  the  actual,  practical  realization  of  the 
reforms  which  have  already  become  the  law,  but  have  not  yet  become 
a  reality. 

In  order  to  continue  further  the  nationalization  of  the  banks  and 
to  move  steadily  toward  the  transformation  of  the  banks  into  cen- 
ters of  social  bookkeeping  under  socialism,  we  must  first  of  all 
be  successful  in  increasing  the  number  of  branches  of  the  People's 
Bank,  in  attracting  deposits,  in  making  it  easier  for  the  public  to 
deposit  and  withdraw  money,  in  removing  the  possibility  of  panics,  in 
discovering  and  executing  the  grafters  and  crooks,  etc.  We  must  first 
actually  accomplish  the  simplest  tasks,  organize  well  what  is  already 
in  our  possession— and  only  then  prepare  for  the  more  complex. 

We  must  improve  and  regulate  the  state  monopolies  in  grain, 
leather,  etc.,  which  we  have  already  established,  and  thereby  pre- 
pare for  the  state  monopolization  of  the  foreign  trade;  without 
such  a  monopoly  we  shall  not  be  able  to  "get  rid  of"  foreign  capital 
except  by  the  payment  of  a  "tribute."  WTiatever  possibility  of 
socialist  construction  exists  depends  on  whether  we  shall  be  able  to 
protect  our  internal  economic  independence  during  the  transition 
period  by  paying  some  "tribute"  to  foreign  capital. 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        187 

We  are  also  extremely  backward  in  the  collection  of  taxes  in  general 
and  of  wealth  and  income  taxes  in  particular.  The  levying  of  contri- 
butions on  the  bourgeoisie— a  measure  which  in  principle  is  undoubt- 
edly acceptable  and  deserving  of  proletarian  approval— fehows  that  we 
are  in  this  respect  still  nearer  to  the  methods  of  conquest  [of  Russia] 
from  the  rich  for  the  poor  than  to  the  methods  of  management. 
But  to  become  stronger  and  to  make  our  position  firm  we  must 
adopt  the  last-named  methods ;  we  must  substitute  for  the  contri- 
butions exacted  from  the  bourgeoisie  steadily  and  regulariy  collected 
wealth  and  income  taxes,  which  will  give  more  to  the  proletarian 
state  and  which  requires*  of  us  greater  organization  and  better- 
regulated  accounting  and  control. 

The  delay  in  introducing  obligatory  labor  service  is  another  proof 
that  the  most  urgent  problem  is  precisely  the  preparatory  organi- 
zation work  which,  on  the  one  hand,  should  definitely  secure  our  gains 
and  which,  on  the  other  hand,  is  necessary  to  prepare  the  cam- 
paign to  "surround  capital"  and  to  "compel  its  surrender."  The 
introduction  of  obligatory  labor  service  should  be  started  imme- 
diately, but  it  should  be  introduced  gradually  and  with  great  caution, 
testing' every  step  by  practical  experience  and,  of  course,  introducing 
first  of  all  obligatory  labor  service  for  the  rich.  The  introduction  of 
a  labor  record  book  and  a  consumption-budget  record  book  for  every 
bourgeois,  including  the  village  bourgeois,  would  be  a  long  step  for- 
ward toward  a  complete  "siege"  of  the  enemy  and  toward  the 
creation  of  a  really  universal  accounting  and  control  over  production 

and  distribution. 

The  state,  an  organ  of  oppression  and  robbery  of  the  people,  left 
us  as  a  heritage  on  the  part  of  the  people  a  great  hatred  for  and  dis- 
trust of  everything  connected  with  the  state.  To  overcome  this  is  a 
very  difficult  task,  which  only  the  Soviets  can  master,  but  which 
requires  even  from  them  considerable  time  and  tremendous  persever- 
ance. This  "heritage"  has  a  particulariy  painful  effect  on  the  ques- 
tion of  accounting  and  control— the  fundamental  question  for  a 
socialist  revolution  after  the  overthrow  of  the  bourgeoisie.  It  will 
inevitably  take  some  time  before  the  masses  begin  to  feel  themselves 
free  after  the  overthrow  of  the  landowners  and  the  bourgeoisie  and  be- 
fore they  comprehend— not  from  books,  but  from  their  own  expe- 
rience through  the  Soviets— that  without  thorough  state  accounting 


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1 88       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

and  control  of  production  and  distribution  the  authority  of  the  toilers, 
and  their  freedom,  cannot  last,  and  a  return  to  the  yoke  of  capitalism 
is  inevitable.  .  .  . 

^  We  have  introduced  labor  control  as  a  law,  but  it  is  barely  be- 
ginning to  be  realized  or  even  to  penetrate  the  consciousness  of  the 
proletarian  masses.    That  unaccountability  in  production  and  dis- 
tribution is  fatal  for  the  first  steps  toward  socialism,  that  it  means 
corruption,  that  carelessness  in  accounting  and  control  is  a  direct 
assistance  to  the  German  and  Russian  Kornilovs,  who  can  overthrow 
the  authority  of  the  toilers  only  in  case  we  do  not  solve  the  problem 
of  accounting  and  control  and  who  with  the  aid  of  the  peasant  bour- 
geoisie, the  cadets,  the  Mensheviks,  and  the  Socialist-Revolutionists 
of  the  Right  are  watching  us,  waiting  for  their  opportunity— this  is 
not  adequately  emphasized  in  our  agitation  and  is  not  given  suffi- 
cient  thought   and   is  not   sufficiently   discussed   by   the  advanced 
workers  and  peasants.    And  as  long  as  labor  control  has  not  be- 
come a  fact,  as  long  as  the  advanced  workers  have  not  carried 
out  a  successful  and  merciless  campaign  against  those  who  violate 
this  control  or  who  are  careless  with  regard  to  control,  we  cannot 
move  from  the  first  step   [from  labor  control]    to  the  second  step 
toward  socialism;   that  is,  to  the  regulation  of  production  by  the 
workers. 

A  socialist  state  can  come  into  existence  only  as  a  net  of  pro- 
duction and  consumption  communes,  which  keep  conscientious  ac- 
counts of  their  production  and  consumption,  and  economize  labor,  at 
the  same  time  steadily  increasing  its  productivity,  thus  making  it 
possible  to  lower  the  workday  to  seven,  six,  or  even  less  hours. 

To  increase  the  productivity  of  labor  we  must  first  of  all  secure 
the  material  basis  of  a  large  industry:  the  development  of  the 
production  of  fuel,  iron,  machinery,  and  of  the  chemical  industry. 
The  Russian  Soviet  Republic  is  in  such  an  advantageous  position 
that  it  possesses,  even  after  the  Brest-Litovsk  peace,  colossal  stores 
of  ore  [on  the  Ural];  of  fuel  in  western  Siberia  [hard  coal],  in 
Caucasia  and  in  the  southeast  [petroleum],  in  Central  Russia  [turf] ; 
vast  resources  of  lumber,  water  power,  and  raw  material  for  the 
chemical  industry  [karabugaz];  and  so  on.  The  exploitation  of 
these  natural  resources  by  the  latest  technical  methods  will  furnish 
a  basis  for  an  unprecedented  development  of  production. 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        189 
Higher  productivity  of  labor  depends,  first,  on  f  improvement 
of  the  educational  and  cultural  state  of  the  masses  of  the  population 
Ths  improvement  is  now  taking  place  with  unusual  swiftness,  but 
is  not  perceived  by  those  who  are  blinded  by  the  bourgeois  rou  me 
and  are  unable  to  comprehend  what  a  longing  for  light  and  initiative 
is  now  pervading  the  masses  of  the  people,  thanks  to  the  Soviet  or- 
l^lLs.    Secondly,  economic   improvement  depends   on   higher 
Sine  of  the  toilers,  on  higher  skill,  efficiency,  and  intensity  of 
labor,  and  its  better  organization.  ...  w    •  f    i.ac 

The  most  conscious  vanguard   of   the   Russian  P-^^^ariatJias 
already  turned  to  the  problem  of  increasing  labor  discipline.    For  n- 
stlnce'  the  central  committee  of  the  Metallurgical  Umon  and  the 
Central  Council  of  the  Trade  Unions  have  begun  work  on  respective 
measures  and  drafts  of  decrees.   This  work  should  be  supported  and 
Advanced  by  all  means.   We  should  immediately  introduce  piece- 
work and  ti  it  out  in  practice.   We  should  try  out  every  scientific 
Ind  progresle  suggestion  of  the  Taylor  system;  we  should  com- 
pare ^he  earnings  with  the  general  total  of  production  or  the  exploi- 
tation  results  of  railroad  and  water  transportation  and  so  on 

The  Russian  is  a  poor  worker  in  comparison  with  the  workers  0 
the  advanced  nations,  and  this  could  not  be  otherwise  under  the 
Sme  of   he  Czar  and  other  remnants  of  feudalism.   To  learn  how 
;Crk_this  problem  the  Soviet  authority  should  present  to  the 
people  in  all  its  comprehensiveness.   The  last  word  of  capitalism  m 
th"    esp^^^    the  Taylor  system,-as  well  as  all  progressive  measures 
ofcSism,-combines  the  refined  cruelty  of  bourgeois  exploita- 
to  and  a  number  of  most  valuable  scientific  attainments  in  the 
analyst  of  mechanical  motions  during  work,  in  dismissing  super- 
Tous  Ld  useless  motions,  in  determining  the  ^^  co^ct^^^^^^^^^^^ 
of  the  work,  the  best  systems  of  accounting  and  ^^f\'\'-J^' 
Soviet  Republic  must  adopt  valuable  scientific  and  technical  ad- 
V  nes  in  this  field.    The  possibility  of  socialism  will  be  determined 
bv  our  su  cess  in  combining  the  Soviet  rule  and  the  Soviet  organi- 
by  our  succebb  &  orogressive  measures  of  capi- 

zation  of  management  with  the  latest  P^ogresb^  teaching  of 

talism    We  must  introduce  in  Russia  the  study  and  the    caching  ot 
h    Tav^sy  and  its  systematic  trial  and  adaptation^  While 

worklg  to   ncrease  the  productivity  of  labor,  we  must  at  the  same 
Ze  take  into  account  the  peculiarities  of  the  transition  period  from 


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190  TRADE  UNIONISM  AND  LABOR  PROBLEMS 
capitalism  to  socialism,  which  require,  on  the  one  hand,  that  we  lav 
the  foundation  for  the  socialist  organization  of  emulation,  and  on 
the  other  hand  require  the  use  of  compulsion,  so  that  the  slogan 
of  the  dictatorship  of  the  proletariat  should  not  be  weakened  by  the 
practice  of  a  too  mild  proletarian  government 

Among  the  absurd  falsehoods  which  the  bourgeois  likes  to  spread 
about  socialism  is  the  one  that  socialists  deny  the  value  of  emulation 
In  reality  only  socialism,  destroying  classes  and,  hence,  the  en- 
slavement of  the  masses,  for  the  first  time  opens  up  opportunities 
for  emulatwn  on  a  mass  scale.  And  only  the  Soviet  organization 
passing  from  the  formal  democracy  of  a  bourgeois  republic  to  the 
actual  participation  in  management  of  the  toiling  masses,  for  the  first 
time  puts  emulation  on  a  broad  basis.  This  is  much  easier  to  accom- 
P  ish  on  the  political  than  on  the  economic  field,  but  for  the  success 
of  socialism  the  latter  is  the  more  important. 

Let  us  take  publicity  as  a  means  for  stimulating  emulation 
And  we  have  hardly  begun   the  immense  and  difficult,  but  also 
promising  and  important,  work  of  stimulating  emulation  between 
he  communes,  of  introducing  reports  and  publicity  in  the  process  of 
the  production  of  bread,  clothing,  etc.,  and  of  transforming  the  dry 
dead  bureaucratic  reports  into  live  examples-either  repulsive  or  at- 
tractive.   Under  the  capitalistic  system  of  production  the  significance 
of  an  individual  example,  say  of  some  group  of  producers,  was  inevi- 
tabty  extremely  limited,  and  it  was  only  a  petty  bourgeois  illusion 
to  dream  that  capitalism  could  be  "reformed"  by  the  influence  of 
models  of  virtuous  establishments.    After  the  political  power  has 
passed  into  the  hands  of  the  proletariat  and  after  the  expropriation 
of  the  expropriators  has  been  accomplished,  the  situation  is  radi- 
cally changed,  and -as  has  been  many  times  pointed  out  by  the 
most  eminent  socialists- the  force  of  an  example  can  for  the  firs 
time  exert  a  mass  effect.    Model  communes  should  and  will  serve 
the  purpose  of  training,   teaching,  and  stimulating  the  backward 
comrnunes.    The  press  should  serve  as  a  weapon  of  socialist  con- 
struction,  giving  publicity  in  all  details  to  the  successes  of  the  model 
communes,  studying  the  principles  of  their  success,  their  methods 
of  economy,  and,  on  the  other  hand,  <' blacklisting"  those  communes 
^hich  persist  in  keeping  the  "traditions  of  capitalism,"   that  is 
anarchy,  loafing,  disorder,  and  speculation.  Statistics  under  capitalism' 


1 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        191 

were  exclusively  in  the  hands  of  government  employees  or  narrow 
specialists ;  we  must  bring  them  to  the  masses,  we  must  popularize 
them  so  that  the  toilers  gradually  learn  to  understand  and  to  see 
for  themselves  what  work  and  how  much  work  is  needed  and  how 
much  rest  they  can  have.  In  this  way  a  comparison  between  the 
results  of  the  enterprise  of  different  communes  will  become  a  sub- 
ject of  general  interest  and  study ;  the  foremost  communes  will  be 
immediately  rewarded  (by  reducing  the  workday  for  a  certain  period, 
by  raising  the  wages,  offering  them  a  greater  quantity  of  cultural  or 
historical  advantages  and  treasures,  etc.).  •  .  . 

No  profound  and  powerful  popular  movement  in  history  ever 
escaped  paying  a  price  to  the  scum;  the  inexperienced  innovators 
have  been  preyed  upon  by  adventurers  and  crooks,  boasters  and 
shouters;    there  have   been   stupid   confusion,   unnecessary   bustle. 
Individual  "leaders"  would  undertake  twenty  tasks  at  once,  com- 
pleting none  of  them.    Let  the  poodles  of  bourgeois  society,  from 
Bielorussoff  to  Martov,  yelp  and  bark  on  account  of  every  addi- 
tional splinter  going  to  waste  while  the  big  old  forest  is  cut  down. 
Let  them  bark.    That  is  what  poodles  are  there  for.   We  will  go 
ahead,  trying  very  cautiously  and  patiently  to  test  and  discover  real 
organizers,  people  with  sober  minds  and  practical  sense,  who  com- 
bine loyalty  to  socialism  with  the  ability  to  organize  quietly  (and 
in  spite  of  confusion  and  noise)  efficient  and  harmonious  joint  work  of 
a  large  number  of  people  under  the  Soviet  organization.    Only  such 
persons  should,  after  many  trials,  advancing  them  from  the  simplest 
to  the  most  difficult  tasks,  be  promoted  to  responsible  posts  to  direct 
the  work  of  the  people,  to  direct  the  management.   We  have  not  yet 
learned  this.   We  will  learn  this. 

The  resolution  of  the  last  (Moscow)  congress  of  the  Soviets  advo- 
cates, as  the  most  important  problem  at  present,  the  creation  of 
"efficient  organization"  and  higher  discipline.  Such  resolutions  are 
now  readily  supported  by  everybody.  But  that  their ,  realization 
requires  compulsion,  and  compulsion  in  the  form  of  a  dictatorship, 
is  ordinarily  not  comprehended.  And  yet  it  would  be  the  greatest 
stupidity  and  the  most  absurd  opportunism  to  suppose  that  the 
transition  from  capitalism  to  socialism  is  possible  without  compulsioD 
and  dictatorship.  The  Marxian  theory  has  long  ago  criticized  beyond 
misunderstanding   this  petty  bourgeois-democratic   and  anarchistic 


I:i 


192       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

nonsense.  And  Russia  of  191 7-19 1 8  confirms  in  this  respect  the 
Marxian  theory  so  clearly,  palpably,  and  convincingly  that  only  those 
who  are  hopelessly  stupid  or  who  have  firmly  determined  to  ignore  the 
truth  can  still  err  in  this  respect.  Either  a  Kornilov  dictatorship 
(if  Kornilov  be  taken  as  the  Russian  type  of  a  bourgeois  Cavaignac) 
or  a  dictatorship  of  the  proletariat — no  other  alternative  is  pos- 
sible for  a  country  which  is  passing  through  an  unusually  swift 
development,  with  unusually  difficult  transitions,  and  which  suffers 
from  desperate  disorganization  created  by  the  most  horrible  war. 
All  middle  courses  are  advanced  (in  order  to  deceive  the  people) 
by  the  bourgeois,  who  are  not  in  a  position  to  tell  the  truth  and 
admit  openly  that  they  need  a  Kornilov,  or  (through  stupidity)  by 
the  petty-bourgeois  democrats, — the  Tchernovs,  Zeretellis,  and  Mar- 
tovs, — prattling  of  a  united  democracy,  of  the  dictatorship  of  democ- 
racy, of  a  single  democratic  front,  and  similar  nonsense.  Those  who 
have  not  learned  even  from  the  course  of  the  Russian  revolution  of 
1917-1918  that  middle  courses  are  impossible  must  be  given  up  as 
hopeless. 

On  the  other  hand,  it  is  not  hard  to  see  that  during  any  transition 
from  capitalism  to  socialism  a  dictatorship  is  necessary  for  two  main 
reasons.  In  the  first  place,  it  is  impossible  to  conquer  and  destroy 
capitalism  without  the  merciless  suppression  of  the  resistance  of  the 
exploiters,  who  cannot  be  at  once  deprived  of  their  wealth,  of  their 
advantages  in  organization  and  knowledge,  and  who  will,  therefore, 
during  quite  a  long  period  inevitably  attempt  to  overthrow  the 
hateful  (to  them)  authority  of  the  poor.  Secondly,  every  great  revo- 
lution, and  especially  a  socialist  revolution,  even  if  there  were  no 
external  war,  is  inconceivable  without  an  internal  war,  with  thou- 
sands and  millions  of  cases  of  wavering  and  of  desertion  from  one 
side  to  the  other  and  with  a  state  of  the  greatest  uncertainty, 
instability,  and  chaos.  .  .  . 

This  historical  experience  of  all  revolutions,  the  universal  his- 
torical, economic,  and  political  lesson,  was  summed  up  by  Marx  in 
his  brief,  sharp,  exact,  and  vivid  formula:  the  dictatorship  of 
the  proletariat.  And  that  the  Russian  revolution  has  correctly  ap- 
proached this  universal  historical  problem  has  been  proved  by  the 
victorious  march  of  the  Soviet  organization  among  all  the  peoples 
and  tongues  of  Russia.    For  the  Soviet  rule  is  nothing  else  than  the 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        I93 

organized  form  of  the  dictatorship  of  the  proletariat— the  dictator- 
ship of  the  advanced  class  awakening  to  a  new  democracy  and  to  inde- 
pendent participation  in  the  administration  of  the  state,  tens  and 
tens  of  millions  of  exploited  toilers  who  through  their  experience  are 
discovering  that  the  disciplined  and  class-conscious  vanguard  of  the 
proletariat  is  their  most  reliable  leader. 

But  "dictatorship"  is  a  great  word.    And  great  words  must  not 
be  used  in  vain.    A  dictatorship  is  an  iron  rule,  with  revolutionary 
daring  and  swift  and  merciless  in  the  suppression  of  the  exploiters  as 
well  as  of  the  thugs  [hooligans].    And  our  rule  is  too  mild,  quite 
frequently  resembling  putty  rather  than  iron.   We  must  not  for  a 
moment  forget  that  the  bourgeois  and  petty-bourgeois  environment 
is  offering  resistance  to  the  Soviet  rule  in  two  ways:  on  the  one 
hand,   by   external   pressure— by   the   methods  of   the   Savinkovs, 
Goltzes,  Gegechkoris,  and  Kornilovs,  by  conspiracies  and  insurrec- 
tions, with  their  ugly  ''ideologic"  reflection,  by  torrents  of  falsehood 
and  calumnv  in  the  press  of  the  Cadets,  Social-Revolutionists  of  the 
Right,  and  Mensheviks ;  on  the  other  hand,  this  environment  exerts 
internal  pressure,  taking  advantage  of  every  element  of  decay,  of 
every  weakness,  to  bribe,  to  increase  the  lack  of  discipline,  dissolute- 
ness, chaos.    The  nearer  we  get  to  the  complete  military  suppression 
of  the  bourgeoisie,  the  more  dangerous  become  for  us  the  petty 
bourgeois  anarchic  inclinations.    And  these  inclinations  cannot  be 
combated  simply  by  propaganda  and  agitation,  by  the  organization  of 
emulation,  by  the  selection  of  organizers ;  they  must  also  be  com- 
bated by  compulsion. 

To  the  extent  to  which  the  principal  problem  of  the  Soviet  rule 
changes  from  military  suppression  to  administration,  suppression  and 
compulsion  will,  as  a  rule,  be  manifested  in  trials  and  not  in  shoot- 
ing on  the  spot.  And  in  this  respect  the  revolutionary  masses  have 
taken,  after  November  7,  191 7,  the  right  road  and  have  proved  the 
vitality  of  the  revolution,  when  they  started  to  organize  their  own 
workmen's  and  peasants'  tribunals  before  any  decrees  were  issued 
dismissing  the  bourgeois-democratic  judicial  apparatus.  But  our  revo- 
lutionary" and  popular  tribunals  are  excessively  and  incredibly  weak. 
It  is  apparent  that  the  popular  view  of  courts— which  was  inher- 
ited from  the  regime  of  the  landowners  and  the  bourgeoisie— as  not 
belonging  to  the  workers,  has  not  yet  been  completely  destroyed. 


l^: 


A:i 


i^' 


194      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

It  is  not  sufficiently  appreciated  that  the  courts  serve  to  attract 
all  the  poor  to  administration  (for  judicial  activity  is  one  of  the 
functions  of  state  administration) ;  that  the  court  is  an  organ 
of  the  rule  of  the  proletariat  and  of  the  poorest  peasantry  ;  that 
the  court  is  a  means  of  training  in  discipline.  There  is  a  lack 
of  appreciation  of  the  simple  and  obvious  fact  that  if  the  chief 
misfortunes  of  Russia  are  famine  and  unemployment,  these  misfor- 
tunes cannot  be  overcome  by  any  outbursts  of  enthusiasm,  but  only 
by  thorough  and  universal  organization  and  discipline,  in  order  to 
increase  the  production  of  bread  for  men  and  fuel  for  industry,  to 
transport  these  in  time,  and  to  distribute  them  in  the  right  way  ;  that, 
therefore,  responsibility  for  the  pangs  of  famine  and  unemployment 
falls  on  everyone  who  violates  the  labor  discipline  in  any  enter- 
prise and  in  any  business  ;  that  those  who  are  responsible  should 
be  discovered,  tried,  and  punished  without  mercy.  The  petty  bour- 
geois environment,  which  we  will  have  to  combat  persistently  now, 
shows  particularly  in  the  lack  of  comprehension  of  the  economic 
and  political  connection  between  famine  and  unemployment  and 
the  prevailing  dissoluteness  in  organization  and  discipline — in  the 
firm  hold  of  the  view  of  the  small  proprietor  that  "nothing  matters 
if  only  I  gain  as  much  as  possible." 

This  struggle  of  the  petty-bourgeois  environment  against  proleta- 
rian organizations  is  displayed  with  particular  force  in  the  railway 
industry,  which  embodies,  probably,  most  clearly  the  economic  ties 
created  by  large  capitalism.  The  "office"  element  furnishes  sabo- 
teurs and  grafters  in  large  numbers;  the  proletarian  element,  its 
best  part,  is  fighting  for  discipline.  But  between  these  two  elements 
there  are,  of  course,  many  who  waver,  who  are  "weak,"  who  are 
unable  to  resist  the  "temptation"  of  speculation,  bribery,  and  per- 
sonal advantage,  at  the  expense  of  the  industry,  the  uninterrupted 
work  of  which  is  necessary  to  overcome  famine  and  unemployment. 

A  characteristic  struggle  occurred  on  this  basis  in  connection  with 
the  last  decree  on  railway  management,  the  decree  which  granted 
dictatorial  (or  "unlimited")  power  to  individual  directors.  The 
conscious  (and  mostly,  probably,  unconscious)  representatives  of 
petty-bourgeois  dissoluteness  contended  that  the  granting  of  "un- 
limited" (that  is,  dictatorial)  power  to  individuals  was  a  defection 
from  the  principle  of  board  administration,  from  the  democratic  and 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        i9<, 

other  principles  of  the  Soviet  rule.  Some  of  the  Social- Revolu- 
tionists of  the  Left  carried  on  a  plainly  demagogic  agitation  against 
the  decree  on  dictatorship,  appealing  to  the  evil  instincts  and  to  the 
petty-bourgeois  desire  for  personal  gain.  The  questions  thus  pre- 
sented are  of  really  great  significance :  first,  the  question  of  principle. 
Is,  in  general,  the  appointment  of  individuals  endowed  with  unlimited 
power,  the  appointment  of  dictators,  in  accord  with  the  fundamental 
principles  of  the  Soviet  rule?  secondly.  In  what  relation  is  this 
case— this  precedent,  if  you  wish— to  the  special  problems  of  the 
Soviet  rule  during  the  present  concrete  period  ?  Both  questions  de- 
serve serious  consideration. 

That  the  dictatorship  of  individuals  has  very  frequently  in  the 
history  of  revolutionary  movements  served  as  an  expression  and 
means  of  realization  of  the  dictatorship  of  the  revolutionary  classes 
is  confirmed  by  the  undisputed  experience  of  history.    The  dictator- 
ship of  individuals  has  undoubtedly  been  compatible  with  bourgeois- 
democratic  principles,  but  this  point  is  always  treated  adroitly  by 
the  bourgeois  critics  of  the  Soviet  rule  and  by  their  petty-bourgeois 
aides.   On  the  one  hand,  they  declare  the  Soviet  rule  simply  some- 
thing absurd  and  anarchically  wild,  carefully  avoiding  all  our  histori- 
cal  comparisons  and  theoretical  proofs  that  the  Soviets  are  a  higher 
form  of  democracy  — nay,  more,  the  beginning  of  a  socialist  form 
of  democracy.   On  the  other  hand,  they  demand  of  us  a  higher 
democracy  than  the  bourgeois,  and  argue,  "Individual  dictatorship 
is  absolutely  incompatible  with  your  Bolshevist  [that  is,  socialist, 
not  bourgeois]    democratic  principles,  with  the  Soviet  democratic 

principles." 

Extremely  poor  arguments,  these.  If  we  are  not  anarchists,  we 
must  admit  the  necessity  of  a  state  (that  is,  of  compulsion)  for  the 
transition  from  capitalism  to  socialism.  The  form  of  compulsion  is 
determined  by  the  degree  of  development  of  the  particular  revolu- 
tionary class,  then  by  such  special  circumstances  as,  for  instance, 
the  heritage  of  a  long  and  reactionary  war,  and  then  by  the  forms 
of  resistance  of  the  bourgeoisie  and  the  petty  bourgeoisie.  There 
is,  therefore,  absolutely  no  contradiction  in  principle  between  the 
Soviet  (socialist)  democracy  and  the  use  of  dictatorial  power  of  in- 
dividuals. The  distinction  between  a  proletarian  and  a  bourgeois 
dictatorship  consists  in  this :  that  the  first  directs  its  attacks  against 


lij 


^'. 


196      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  exploiting  minority  in  the  interests  of  the  exploited  majority ; 
and,  further,  in  this:  that  the  first  is  accomplished  (through  in- 
dividuals) not  only  by  the  masses  of  the  exploited  toilers  but  also  by 
organizations  which  are  so  constructed  that  they  arouse  these  masses 
to  creative  work  of  historic  significance.  The  Soviets  belong  to  this 
kind  of  organization. 

With  respect  to  the  second  question  on  the  significance  of  indi- 
vidual dictatorial  power  from  the  standpoint  of  the  specific  prob- 
lems of  the  present  period,  we  must  say  that  every  large  machine 
industry — which  is  the  material  productive  source  and  basis  of 
socialism — requires  an  absolute  and  strict  unity  of  the  will  which 
directs  the  joint  work  of  hundreds,  thousands,  and  tens  of  thousands 
of  people.  This  necessity  is  obvious  from  the  technical  economic 
and  historical  standpoint  and  has  always  been  recognized  as  its 
prerequisite  by  all  those  who  have  given  any  thought  to  socialism. 
But  how  can  we  secure  a  strict  unity  of  will  ?  By  subjecting  the  will 
of  thousands  to  the  will  of  one. 

This  subjection,  if  the  participants  in  the  common  work  are 
ideally  conscious  and  disciplined,  may  resemble  the  mild  leading  of 
an  orchestra  conductor ;  it  may  also  take  the  acute  form  of  a  dic- 
tatorship, if  there  is  no  ideal  discipline  and  consciousness.  At  any 
rate,  complete  submission  to  a  single  will  for  the  success  of  the  proc- 
esses of  work  organized  on  the  type  of  large  machine  industry  is 
absolutely  necessary.  This  is  doubly  true  of  the  railways.  And 
just  this  transition  from  one  political  problem  to  another  which  in 
appearance  has  no  resemblance  to  the  first  constitutes  the  peculiarity 
of  the  present  period.  The  revolution  has  just  broken  the  oldest, 
the  strongest,  and  the  heaviest  chains  to  which  the  masses  were 
compelled  to  submit.  So  it  was  yesterday.  And  today  the  same 
revolution  —  and  indeed  in  the  interest  of  socialism — demands  the 
absolute  submission  of  the  masses  to  the  single  will  of  those  who 
direct  the  labor  process.  .  .  . 

We  have  successfully  solved  the  first  problem  of  the  revolution. 
We  saw  how  the  toiling  masses  formed  in  themselves  the  fundamental 
condition  of  a  successful  solution — united  efforts  against  the  ex- 
ploiters to  overthrow  them.    Such  stages  as  October,   1905,^   and 

1  October,  1905,  saw  the  beginning  of  the  first  Russian  Revolution.  It  was 
during  that  month  that  the  general  strike  was  declared  and  the  open  struggle 


PROLETARIAN  SCIENTIFIC  MANAGEMENT        197 

March  and  November,  1917,  are  of  universal  historical  significance. 
We  have  successfully  solved  the  second  problem  of  the  revolution 
—to  awaken  and  arouse  the  downtrodden  social  classes  which  were 
oppressed  by  the  exploiters  and  which  only  after  November  7,  191 7, 
have  obtained  the  freedom  to  overthrow  them  and  to  begin  to  take 
stock  and  to  regulate  their  lives  in  their  own  way.  The  "meeting- 
holding"  of  the  most  oppressed  and  downtrodden,  of  the  least- 
trained  toiling  masses,  their  joining  the  Bolsheviks,  their  creating 
Soviet  organizations  everywhere,— this  is  the  second  great  stage  of 
the  revolution. 

We  are  now  in  the  third  stage.  Our  gains,  our  decrees,  our  laws, 
our  plans,  must  be  secured  by  the  solid  forms  of  everyday  labor 
discipline.  This  is  the  most  difficult,  but  also  the  most  promising, 
problem,  for  only  its  solution  will  give  us  socialism.  We  must  learn 
to  combine  the  stormy,  energetic  breaking  of  all  restraint  on  the  part 
of  the  toiling  masses  with  iron  discipline  during  work,  with  absolute 
submission  to  the  will  of  one  person,  the  Soviet  director,  during  work. 

We  have  not  yet  learned  this,  but  we  will  learn  it. 

The  restoration  of  bourgeois  exploitation  threatened  us  yesterday 
through  the  Kornilovs,  Goltzes,  Dutovs,  Gegechkoris,  Bogajevskys. 
We  defeated  them.  This  restoration,  the  very  same  restoration, 
threatens  us  today  in  a  different  form,  through  the  environment  of 
petty-bourgeois  dissoluteness  and  anarchism,  in  the  form  of  ordinary, 
small,  but  numerous  attacks  and  aggressions  of  this  environment 
against  proletarian  discipline.  This  environment  of  petty-bourgeois 
anarchy  we  must  and  we  will  conquer. 

The  socialist  character  of  the  Soviet  democracy — that  is,  of 
proletarian  democracy  in  its  concrete  particular  application — con- 
sists first  in  this :  that  the  electorate  comprises  the  toiling  and  ex- 
ploited masses ;  that  the  bourgeoisie  is  excluded.  Secondly,  in  this : 
that  all  bureaucratic  formalities  and  limitations  of  elections  are  done 
away  with ;  that  the  masses  themselves  determine  the  order  and 
the  time  of  elections  and  with  complete  freedom  of  recall  of  elected 
officials.  Thirdly,  that  the  best  possible  mass  organization  of  the 
vanguard  of  the  toilers — of  the  industrial  proletariat — is  formed, 

between  the  revolutionary  forces  and  the  autocracy  ensued.  The  Czar's 
government  was  forced  to  grant  a  constitution  (October  30)  and  establish  a 
parliamentary  form  of  government  (Duma). 


if: 


M'^ 


198       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

enabling  them  to  direct  the  exploited  masses,  to  attract  them  to  ac- 
tive participation  in  political  life,  to  train  them  politically  through 
their  own  experience ;  that  in  this  way  a  beginning  has  been  made 
for  the  first  time  actually  to  get  the  whole  population  to  learn  how 
to  manage  and  to  begin  managing.  .  .  . 

This  proximity  of  the  Soviets  to  the  toiling  people  creates  special 
forms  of  recall  and  other  methods  of  control  by  the  masses  which 
should  now  be  developed  with  special  diligence.  For  instance,  the 
councils  of  popular  education  deserve  the  fullest  sympathy  and  sup- 
port as  periodical  conferences  of  the  Soviet  electors  and  their  dele- 
gates to  discuss  and  to  control  the  activity  of  the  Soviet  authorities 
of  the  particular  region.  Nothing  could  be  more  foolish  than  turning 
the  Soviets  into  something  settled  and  self-sufficient.  The  more 
firmly  we  now  have  to  advocate  a  merciless  and  firm  rule  and  dicta- 
torship of  individuals  for  definite  processes  of  work  during  certain 
periods  of  purely  executive  functions,  the  more  diverse  should  be  the 
forms  and  means  of  mass  control  in  order  to  paralyze  every  possi- 
bility of  distorting  the  Soviet  rule,  in  order  repeatedly  and  tire- 
lessly to  remove  the  wild  grass  of  bureaucratism.  .  .  . 

Try  to  compare  w^ith  the  ordinary^  popular  idea  of  a  "  revolution- 
ist" the  slogans  which  are  dictated  by  the  peculiarities  of  the  present 
situation :  to  be  cautious,  to  retreat,  to  wait,  to  build  slowly,  to  be 
mercilessly  rigorous,  to  discipline  sternly,  to  attack  dissoluteness. 
Is  it  surprising  that  some  "revolutionists,"  hearing  this,  become  full 
of  noble  indignation  and  begin  to  "attack"  us  for  forgetting  the 
traditions  of  the  November  revolution,  for  compromising  with  bour- 
geois specialists,  for  compromises  with  the  bourgeoisie,  for  petty- 
bourgeois  tendencies,  for  reformism,  etc.  etc.?  .  .  . 


Nikolai  Lenin 


Premier,  Russian  Soviet  Republic 


XV 
PREMIUM  AND  BONUS  SYSTEMS  OF  PAYMENT^ 

IT  IS  very  difficult  to  distinguish  between  the  premium  and  the 
bonus  systems  of  remuneration,  for  the  two  names  are  used  almost 
indiscriminately.  The  term  ''bonus"  is,  however,  more  frequently 
applied  at  the  present  time  to  any  contingent  payment,  and  any 
plan  under  which  such  payments  are  offered  is  likely  to  be  called 
a  "bonus"  plan  or  system. 

The  first  examples  of  such  plans  were,  however,  known  as  pre- 
mium plans.  Under  them  the  extra  payment  or  premium  was 
generally  a  fixed  proportion,  usually  a  half,  and  almost  never  more 
than  a  half,  of  what  the  workers'  regular  wages  would  be  for  the 
number  of  hours  or  minutes  by  which  he  reduced  the  time  formerly 
taken  on  an  average  to  turn  out  a  given  amount  of  work.  The 
essentials  of  the  system  were  set  forth  by  Mr.  F.  A.  Halsey,^  with 
whose  name  the  premium  system  is  most  closely  associated,  in  a 
paper  read  before  the  American  Society  of  Mechanical  Engineers  in 
1891.^ 

The  essential  principle  is  ...  as  follows :  the  time  required  to 
do  a  given  piece  of  work  is  determined  from  previous  experience,  and 
the  workman,  in  addition  to  his  usual  daily  wages,  is  offered  a 
premium  for  every  hour  bv  which  he  reduces  that  time  on  future 
work,  the  amount  of  the  premium  being  less  than  his  rate  of  wages. 
]VIaking  the  hourly  premiums  less  than  the  hourly  wages  is  the 

1  From  Appendix  B,  "  The  Standard  Rate  in  American  Trade  Unions,"  Johns 
Hopkins  University  Studies  in  Historical  and  Political  Science,  Series  XXX, 
No.  2  (1912),  pp.  23S-241.  r    .1.      «  • 

2  Systems  of  payment  involving  the  essential  features  of  the  premium 
plan,"  that  is,  extra  payments  for  time  saved  at  rates  below  the  regular  rate 
for  that  time,  had  been  occasionally  used  in  the  metal  trades  before  Mr.  Hal- 
sey's  plan  was  proposed.  Some  of  these  were  referred  to  as  '"bonus"  plans. 
(Transactions  of  the  American  Society  of  Mechanical  Engineers,  Vol.  VIII, 
p.  469;  Vol.  X,  p.  622;  Vol.  XII,  p.  767)  ^  .    c.  ^• 

^Ibid.  Vol.  XII,  pp.  7S5  et  seq.  Paper,  without  discussion,  Economic  Studies, 
American  Economic  Association,  Vol.  I,  No.  2   (1896). 

199 


U'-r' 


200       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

foundation  stone  on  which  rest  all  the  merits  of  the  system,  since 
by  it  if  an  hour  is  saved  on  a  given  product  the  cost  of  the  work  is 
less  and  the  earnings  of  the  workman  are  greater  than  if  the  hour  is 
not  saved,  the  workman  being  in  effect  paid  for  saving  time. 

Assume  a  case  in  detail:  Under  the  old  plan  a  piece  of  work  re- 
quires ten  hours  for  its  production,  and  the  wage  paid  is  30  cents 
per  hour.  Under  the  new  plan  a  premium  of  10  cents  is  offered  the 
workman  for  each  hour  which  he  saves  over  the  ten  previously  re- 
quired. If  the  time  be  reduced  successively  to  five  hours,  the  results 
will  be  as  follows : 


PREMIUM  AND  BONUS  SYSTEMS 


201 


Time  Consumed 

{Hm*rs) 

Wages  per 
Piece 

Premium 

Total  Cost 

OF  WOKK- 

CoL.  2  +  Coi..  3 

Workman's  Earn- 
ings HER  Hour 
Col.  4-4- Col.  i 

10 

$3-oo 

$0.00 

$3.00 

$0.30 

9 

2.70 

O.IO 

2.80 

0.3 1 1 

8 

2.40 

0.20 

2.60 

0325 

7 
6 

2.10 

1.80 

0.30 
0.40 

2.40 
2.20 

0-343 
0.366 

5 

1.50 

0.50 

2.00 

0.40 

The  amount  of  the  premium,  according  to  Mr.  Halsey,  should  vary 
with  the  degree  to  which  the  extra  output  requires  an  increased 
exertion  on  the  part  of  the  worker.    In  1895  be  said: 

The  only  system  which  will  endure  is  the  one  which  pays  the 
least  possible  per  piece  of  product.  The  purpose  of  these  systems  is 
not,  prmiarily,  to  pay  higher  wages  but  to  produce  cheap  work,  the 
adjustment  sought  being  one  which  shall  give  the  workman  an  in- 
creased wage  per  day  in  return  for  the  decreased  cost  per  piece  of 
product.^ 

The  more  recently  advocated  systems,  to  which  the  term  "bonus" 
has  usually  been  applied,  seem  to  have  as  their  essential  aim  the 
reaching  of  a  specific  output  considerably  higher  than  the  previous 
average.  Mr.  F.  W.  Taylor  described  a  system  of  remuneration  be- 
fore the  American  Society  of  Mechanical  Engineers  in  1895,  which 
he  called  a  "differential  rate  system  of  piecework,"  in  which  the 
central  aim  was  to  secure  "  the  largest  amount  of  work  of  a  certain 
kind  that  can  be  done  in  a  day."  A  rising  rate  per  piece  as  the 
output  increased  toward  the  maximum  was  the  stimulus  offered  the 

1  Transactions,  Vol.  XVI,  p.  885. 


worker  in  the  scheme  of  payment.^  Mr.  Taylor  insisted  then  and 
later  that  the  central  point  in  his  system  was  the  ascertainment 
through  a  determination  of  "  unit  times,"  that  is,  the  shortest  time 
in  which  each  separate  operation  can  be  performed,  of  the  maximum 
output  which  can  be  expected  in  a  given  time  from  good  workmen 
working  at  the  highest  rate  of  speed  which  can  be  regularly  main- 
tained. His  differential  rate  system  of  payment  was  intended  as  an 
inducement  to  the  men  to  maintain  that  rate  of  output  after  it  had 

been  ascertained. ^ 

In  1895,  in  reply  to  a  criticism  that  the  rise  in  the  rate  as  the  out- 
put approaches  the  maximum  results  in  a  higher  labor  cost  per  piece 
for  the  enlarged  output  than  would  be  the  case  under  an  ordinary 
piece  system,  Mr.  Taylor  said  : 

On  the  contrary,  with  the  differential  rate  the  price  will,  in  nine 
cases  out  of  ten,  be  much  lower  than  would  be  paid  per  piece  either 
under  an  ordinary  piecework  plan  or  on  day's  work.  An  illustration 
of  this  fact  can  be  seen  by  referring  to  paragraphs  78  to  83  of  the 
paper,  in  which  it  will  be  found  that  a  piece  of  work  for  which 
the  workmen  had  received  for  years,  under  the  ordinary  piecework 
system,  50  cents  per  piece,  was  done  under  my  system  for  35  cents 
per  piece  while  in  this  case  the  workmen  earned  $3.50  per  day, 
when  they  had  formerly  made,  under  the  50  cent  rate,  only  S2.25 

per  day.^  ...  .  ,  ,  1  • 

It  is  quite  true  that  under  the  differential  rate  the  workingmen  earn 
higher  wages  than  under  other  systems,  but  it  is  not  that  they  get 
a  higher  price  per  piece,  but  because  they  work  much  harder,  since 
they  feel  that  they  can  let  themselves  out  to  the  fullest  extent  with- 
out danger  of  going  against  their  own  interests  * 

In  1901  Mr.  H.  L.  Gantt  presented  to  the  same  society  a  paper 
describing  a  "  Bonus  System  of  Rewarding  Labor,  being  a  System  of 
Task  Work  with  Instruction  Cards  and  a  Bonus."  Under  his  plan 
of  payment  the  specified  task  is  made  the  worker^s  goal,  and  if  he 
fails  to  reach  it  he  receives  no  bonus. 

^Transactions,  Vol.  XVI,  pp.  856-903.  (This  paper  is  also  reprinted  in  the 
Economic  Studies,  Vol.  I,  No.  2.) 

^Ibid.  Vol.  XVI,  pp.  875,  903;  Vol.  XXIV,  pp.  i337-i338. 

3 In  the  case  referred  to,  the  original  output  was  four  to  five  a  day;  the 
maximum  was  set  at  ten,  and  when  ten  were  produced  in  a  day  35  cents  per 
piece  was  paid;  when  less  than  ten  were  turned  out  in  a  day  less  per  piece 
was  paid.  ^Ibid.  Vol.  XVI,  pp.  887  et  seq. 


III' 


II 


202       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

If  the  man  follows  his  instructions  and  accomplishes  all  the  work 
laid  out  for  him  as  constituting  his  proper  task  for  the  day,  he  is 
paid  a  definite  bonus  in  addition  to  the  day  rate  which  he  always 
gets.  If,  however,  at  jthe  end  of  the  day,  he  has  failed  to  accomplish 
all  of  the  work  laid  out,  he  does  not  get  his  bonus  but  simply  his 
day  rate.  .  .  .  This  system  is,  so  far  as  the  writer  is  aware,  a  new 
one,  but  it  is  based  on  the  principles  of  Mr.  Fred.  W.  Taylor's  system 
of  elementary  rate  fixing.^ 

Mr.  Harrington  Emerson  describes  a  system  of  bonus  payment  in 
the  Engineering  Magazine  for  February,  1909,  which  is  based  on  a 
system  of  ''standard  time  determination."  A  "standard  time"  is 
established,  which  is  considered  the  minimum  time  in  which  the 
given  output  can  be  reached  by  the  use  of  the  best  methods.  The 
worker  who  turns  out  the  work  in  the  "standard"  time  is  said  to 
have  an  "efficiency  of  100  per  cent."  The  workman  receives  a 
fixed  sum  and  in  addition  receives  as  a  bonus  a  percentage  of  his 
regular  rate  which  increases  more  than  proportionally  with  each  per 
cent  of  efficiency  attained  above  67  per  cent.  At  80  per  cent 
efficiency,  for  instance,  the  bonus  is  3.27  per  cent;  at  90  per  cent, 
9.91  per  cent ;  at  95  per  cent,  14.53  per  cent ;  and  at  100  per  cent 
efficiency  it  is  20  per  cent.  If  the  workman  increases  the  output 
above  the  "standard,"  the  bonus  increases  i  per  cent  for  each  added 
percentage  of  efficiency  above  100  per  cent ;  at  133K  per  cent 
efficiency,  for  example,  the  bonus  would  be  53^/  per  cent. 

The  average  output  before  the  introduction  of  the  system  is  con- 
sidered as  67  per  cent  efficiency.  A  worker  who  reaches  100  per  cent 
efficiency  must  turn  out  50  per  cent  more  output  in  a  given  time  than 
before.  Assume,  for  example,  that  workmen  with  a  wage  rate  of 
40  cents  an  hour  have  been  turning  out  on  an  average  6  units  of  a 
given  article  in  six  hours.  The  new  "  standard  time  "  for  6  units  is 
set  at  four  hours.  One  and  a  half  units  of  output  is  now  said  to  be 
a  "standard  hour."  If  the  worker  turns  out  6  units  in  six  hours, 
as  before,  he  has  made  but  four  standard  hours  in  six  hours  of 
working  time  and  his  efficiency  is  but  67  per  cent.  Therefore,  he  re- 
ceives simply  his  hourly  rate  of  40  cents  and  no  bonus.  If  he  turns 
out  6  units  in  five  hours,  he  has  made  four  standard  hours  in  five 
hours  of  working  time  and  his  efficiency  is  80  per  cent.    He  will  now 

^Transactions,  Vol.  XXIII,  pp.  341-372;  Vol.  XXIV,  p.  1322;  Vol.  XXX, 
p.  1042. 


PREMIUM  AND  BONUS  SYSTEMS 


203 


receive  his  regular  rate  of  40  cents  an  hour  for  the  five  hours  worked 
and  a  bonus  of  0.327  per  cent  of  that  sum— a  total  of  $2.07,  or  414 
cents  an  hour.  If  he  does  the  work  in  standard  time  and  turns  out 
the  6  units  in  four  hours,  he  has  made  four  standard  hours  in  four 
hours  of  working  time  and  receives  his  regular  rate  for  the  latter, 
$1.60,  plus  20  per  cent  of  that  as  a  bonus— a  total  of  S1.92,  or  48 
cents  per  hour.  If  he  should  be  able  to  reduce  the  standard  time 
to  such  an  extent  that  he  halves  his  previous  time  for  the  6  units,  he 
makes  four  standard  hours  in  three  working  hours  and  his  efficiency  is 
1331^  per  cent.  He  would  then  receive  pay  at  his  regular  rate  for 
the  three  hours,  $1.20,  plus  a  bonus  of  53>^  per  cent  of  that— a 
total  of  $1.84  or  61^  cents  an  hour. 

The  labor  cost  to  the  employer,  or  the  price  per  piece  received  by 
the  worker,  decreases,  of  course,  as  the  output  increases.  At  the  old 
output,  or  67  per  cent  efficiency,  the  rate  per  unit  is  40  cents ;  at 
80  per  cent  efficiency  it  is  34.5  cents ;  at  100  per  cent,  32  cents  ;  and 
at  133^  per  cent,  307^  cents. 

These  plans  for  bonus  payment  are  frankly  intended  to  stimulate  the 
worker  to  increased  effort.  Mr.  Taylor,  Mr.  Gantt,  Mr.  Emerson,  and 
Mr.  Halsey  all  assume  that  most  workers  could  considerably  increase 
their  outputs  under  present  methods  without  over-exertion.  Mr.  Taylor 
said  in  1903,  in  advocating  his  system  of  work  and  payment: 

That  there  is  a  difference  between  the  average  and  the  first-class 
man  is  known  to  all  employers,  but  that  the  first-class  man  can  do  in 
most  cases  from  two  to  four  times  as  much  as  is  done  on  an  average 
is  known  to  but  few,  and  is  fully  realized  only  by  those  who  have 
made  a  thorough  and  scientific  study  of  the  possibilities  of  men.  .  .  . 
It  must  be  distinctly  understood  that  in  referring  to  t]ie  possibili- 
ties of  a  first-class  man  the  writer  does  not  mean  what  he  can  do 
when  on  a  spurt  or  when  he  is  overexerting  himself,  but  what  a  good 
man  can  keep  up  for  a  long  term  of  years  without  injury  to  his  health 
and  become  happier  and  thrive  under .^ 

It  appears  from  other  statements  of  this  writer  that  the  difference 
between  what  the  first-class  man  can  do  and  what  the  average  man 
does  lies  largely,  in  his  opinion,  in  differences  in  intensity  of  effort.^ 
Mr.  Taylor  does,  however,  lay  great  stress  upon  the  necessity  of 
selecting  the  men  who  are  to  be  asked  to  work  under  his  plan. 

^Transactions,  Vol.  XXIV,  p.  i345- 

2 Ibid.  Vol.  XVI,  pp.  864,  878;  Vol.  XXIV,  p.  1350. 


If 


\t\- 


p 


204       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Mr.  Gantt  says  that  for  a  ''fixed  daily  wage"  the  ordinary  work- 
man "will  seldom  do  more  than  a  fraction  of  the  work  he  can 
do.^ "  Mr.  Emerson,  in  describing  his  own  efficiency  system,  quotes 
Mr.  Taylor's  views  with  approval  and  proceeds  on  the  same  assump- 
tion that  the  worker,  if  he  will,  can  greatly  increase  his  output  without 
injury  to  himself.-  In  his  first  paper,  in  1891,  Mr.  Halsey,  speaking 
of  the  daywork  plan,  said  : 

He  [the  workman]  has  consequently  no  inducement  to  exert  him- 
self and  does  not  exert  himself.  ...  In  certain  classes  of  work  an 
mcrease  m  production  is  accompanied  with  a  proportionate  increase 
of  muscular  exertion,  and  if  the  work  is  already  laborious,  a  liberal 
premium  will  be  required  to  produce  results.  In  other  classes  of 
work  increased  production  requires  only  increased  attention  to  speeds 
and  feeds,  with  an  increase  of  manual  dexterity  and  an  avoidance 
of  lost  time.    In  such  cases  a  more  moderate  premium  will  suffice.-^ 

The  same  views  are  reaffirmed  by  IVIr.  Halsey  in  an  article  in  the 
American  Machinist,  March,  1899. 

^J^-  Gajitt  and  Mr.  Emerson  both  emphasize  particularly  that  the 
increased  ouFputs  are'To  come  in  large  part  from  improvements  in 
the  methods  followed  by  the  workman  in  performing  his  tasks.  The 
payment  of  bonuses  is  advocatecTnoronryaTa  means  of  calling  out 
additional  exertion  on  the  part  of  the  worker  but  as  an  inducement 
to  the  workman  to  follow  instructions  and  to  cooperate  in  the  intro- 
duction of  methods  which  increase  output  with  only  a  fractional  in- 
crease in  exertion  on  his  part.  Their  systems  are  rather  "efficiency" 
systems  than  mere  schemes  of  pa^^HTent ;  the  bonus  plans  oi  payment 
are  followed  only  as  a  part  of  the  general  scheme  for  increasing  the 
efficiency  of*  the  working-force  and  thereby  reducing  the  labor  cost 
of  production.^ 

David  A.  McCabe 

Princeton  University 

^  Transactions,  Vol.  XXIV,  p.  267. 
^Engineering  Magazine,  May,  1908. 
3  Transactions,  Vol.  XII,  p.  760. 

M.V^f • /"fk^^"^"^'  ^'  ^^''   ^'"'-  ^™^'  P-   '^y'   Engineering  Magazine, 
May,  1908;  February,  1909,  passim. 


Vl 


XVI 

PROTECTION  OF  PIECE  RATE^ 

PIECE  rate  is  the  leading  variety  of  those  forms  of  industrial 
remuneration  which  are  known  collectively  as  ''payment  by 
results."    Under  each  of  these  methods,  in  contrast  to  time  wage,  the 
performance  of  the  workman  is  measured  at  frequent  intervals,  and 
he  is  paid  accordingly.    He  thus  works  for  himself  as  well  as  for  the 
employer  and  has  a  direct  incentive  to  "  take  up  the  slack "  on  his 
work,  which  last  may  often  be  accomplished  through  exercise  of 
ingenuity  as  well  as  through  greater  exertion.    Under  time  wage  the 
advantage  or  gain  from  taking  up  slack  accrues  solely  to  the  em- 
ployer, and  the  only  incentive  that  the  workman  has  to  create  that 
gain  ( apart  from  any  contingent  participation  in  the  profits  or  the 
fear  of  discharge )  is  the  indirect  or  generalized  incentive  of  a  pos- 
sible future  advance  of  his  rate  of  pay  or  promotion  to  a  higher 
position.    Day  by  day  and  job  by  job  as  he  goes  along,  the  typical 
workman  remunerated  by  the  hour  is  a  hireling  paid  for  his  time,  not 
a  tradesman  paid  for  his  product,  and  any  reward  for  well-doing  is 
too  remote  and  contingent  to  have  full  psychological  effect.  "  Pay- 
ment by  results"  dignifies  labor  by  making  the  workman  to  a  degree 
his  own  master,  and  on  each  job  it  has  direct  psychological  effect 
with  respect  to  zeal  of  performance.   This  is  the  theory  of  payment 
by  results,  but  unfortunately  the  application  of  it  has  been  such  as 
to  bring  about  much  discontent  and  bitterness  in  the  industrial 
world,  and  to  cause  widespread  ''  limitation  of  output,"  or  just  the 
opposite  of  taking  up  slack. 

Methods  of  wage  payment  by  results  fall  into  three  main  classes : 
th£.iLhQnus"  method  (including  differential  piece  rate),ihe  "pre^ 
mium "  mitliod  (mcluding  some  bonus  schemes  falsely  so  called), 
and_ordiBary  piecfijate-  All  these  methods  have  several  subvarieties. 
Piece  rate  is  used  in  combination  with  guaranteed  time  wage  in  sev- 
eral different  ways;  there  are  a  number  of  different  forms  of  the 

iFrom  American  Economic  Review,  Vol.  IX  (i9i9)>  PP-  455-467- 

205 


\ 


;tij 


fr 


hi 


it 


I'i: 


206      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

premium  method  and  of  the  bonus  method.  Even  if  a  few  distinctive 
types  alone  were  described,  the  technicalities  involved  would  make 
this  paper  unduly  long  and  complex.  My  purpose  in  writing  it  will 
therefore  be  best  served  by  confining  myself  to  a  discussion  of 
"straight"  piecej;ate;  that  is,  the  payment  of  a  fixed  amount  of 
money,  irrespective  of  the  time  acuTaily  taken^  for  each  unTHTpF^d- 

iict  counted,  measured,  oF weighed. ~         '  — 

The  leading  elements  of  piece  rate  are  revealed  when  we  consider 
what  is  done  in  "setting  a  rate"  or  '^pricing  a  job"  to  be  paid  for 
by  this  method. 

I-  There  is  the  more  or  less  complete  definition  of  thejoj).  The 
job  is,  or  should  be,  a  certain  operation  on  a  certain  ^^part"  or  kind 
of  material,  performed  by  hand  or  by  machine,  and  there  may  be 
certain  appliances  to  facilitate  the  work,  such  as  jigs  or  other  tools. 
Of  course  it  makes  a  great  difference  what  machines,  run  at  what 
speed,  working  on  what  quality  of  material,  and  in  what  quantity. 
The  workman  cannot  get  his  hand  in  as  well  on  short  jobs  frequently 
changed  as  on  lon^  jobs  changed  infrequently.  Piece  rate  is  not  neces- 
sarily confined  to  "repetition  work,"  but,  as  is  well  known,  it  fits 
best  that  class  of  manufacturing. 

2-  T^^ereisjh^  of  the  approximate  time  it  will  take 
^°^^iiSi2Er^^L  is,  Usually,  nornrrtime  for" the  indi^oHUiTpTec? 
but  for  the  whole  number  of  pieces  (or  yards  or  pounds  )  to  be  done 
together  as  one  batch  or  lot.  For  example,  five  hours  is  estimated  to 
be  the  time  required  to  do,  working  briskly,  a  lot  of  500  pieces. 

3-  There.is„i^ken  into  £ojosiderati^^  the  grade  of  labor  proper  for 
t\^  job  and  the  hourly  wage  rate  of  That  grade' f  for  exampTe7for 
this  job  a  grade  of  labor  that  calTs  for  weekly  earnings  of  $22  in 
a  fifty-five-hour  week  and  therefore  a  time  rating  or  base  wage  of 
40  cents  an  hour.  (If  the  working  hours  per  week  were  forty-four, 
then  for  this  $2  2-a-week  grade  of  labor  the  time  rating  would  be 
50  cents  an  hour.)  This  base  wage  multiplied  by  the  estimated  time 
required  or  expected  to  be  taken  yields  a  rate  or  price  for  the  job 
which  is  the  equivalent  of  the  standard  of  pay  thus  far  assumed  to 
be  proper  for  the  job.  (Thus  five  times  40  cents  equals  $2.)  This 
last  is  called,  in  shop  terminology,  "  time."  If  the  workman  should 
do  just  two  of  these  jobs  in  a  ten-hour  day  and  be  paid  S4,  he  would 
be  said  to  be  making  his  "  time." 


PROTECTION  OF  PIECE  RATE 


207 


4.  And,  finally,  it.4sjakenjjitx>^^^  piece 

rates  are  properly  set)  thixSE^Qikmaa^musTHrje^^^ 
desired --ffTr^^-*f**^H  "pi>rp-rate  intensity  of  effort,"  or  voluntary 
zeal  in  performance,  which  is  the  employer's  object  in  going  to  the 
trouble  of  putting  the  job  on  piece  rate  and  incurring  continuing 
expense  in  counting  and  recording  for  the  pay  roll  after  the  rate  is 
set.    If  the  workman  is  to  have  opportunity  to  make  only  "time" 
on  the  job,  he  will  not  exert  himself  to  develop  speed  or  ingenuity  any 
more  than  if  he  were  on  ordinary  day  wage.    He  must  have  the  in- 
centive of  an  opportunity  to  make  more  than  his  time ;  there  must 
be  a  bonus  factor  in  the  piece  rate.    Accordingly  the  piece-rate 
equivalent  of  the  base  time  wage  ($2  in  this  case)  is  increased  by, 
say,  25  per  cent  to  enable  the  workman  to  make  at  the  assumed 
proper  speed  of  working  what  is  called  "time  and  a  quarter"— $2.50 
for  the  job,  or  20  cents  an  hour,  or  S5  in  a  ten-hour  day.    This  final 
revision  of  the  job  price  sets  a  standard  rate  of  remuneration  for  the 
job  as  put  on  piece  rate,  the  unit  of  pay  being  adjusted  to  the  unit 
of  effort,  which  is  what  the  workman  sells  in  the  last  analysis  rather 
than  the  physical  product.    If  the  employer,  as  sometimes  happens, 
omits  the  bonus  factor  from  the  revised  piece  rate  and  depends  for 
results  upon  ^^ driving,"  he  is  attempting  to  get  "piece-rate  intensity 
of  effort"  without  paying  for  it. 

The  rest  of  the  process  of  rate-setting  is  merely  arithmetic  — 
dividing  the  revised  job  price  by  the  number  of  pieces  comprising 
the  job  or  lot  (500  in  this  case),  which  yields  five  tenths  of  a  cent 
as  the  individual  piece  rate,  or  piece  price,  for  doing  this  work. 
Thereafter,  whatever  the  varying  number  of  pieces  the  workman  may 
do  in  any  pay-roll  period,  the  ascertained  count  is  multiplied  by  five 
tenths  of  a  cent  and  he  finds  the  money  in  his  pay  envelope  to 
correspond.  It  is  obvious  that  as  long  as  the  rate  stands  un- 
changed the  advantage  from  any  "time  saved"  in  doing  the  work, 
as  compared  with  the  estimated  time  required  by  which  the  rate  was 
set,  accrues  solely  to  the  workman.  That  is,  the  employer  gains 
nothing  on  direct  labor  cost  if  the  workman  takes  up  more  slack  than 
was  expected.  The  employer's  gain  in  that  event  consists  in  a  lower 
total  cost  by  reason  of  the  fixed  charges  or  overhead  being  spread 
over  a  larger  product,  together  with  the  further  indirect  advantages 
from  prompt  delivery  to  customers  and  other  like  considerations. 


11 


I 


208       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

To  sum  up,  the  complicated  structure  of  a  piece  rate  properly  set 
includes  (i)  the  definition  of  the  job  (not  merely  the  name  of 
the  job  but  a  statement  of  the  controlling  conditions  under  which  the 
work  is  done);  (2)  the  time-required  basis;  (3)  the  base  time 
wage,  or  hourly  rating  ;  (4)  the  bonus,  or  standard  reward  for  effort, 
which  the  workman  is  expected  to  earn  if  the  actual  time  taken  coin- 
cides with  the  time  expected  to  be  taken.  The  labor  value  of  any 
time  saved  by  a  greater  speed  of  working  is  to  go  to  the  workman 
as  additional  bonus. 

The  great  source  of  trouble  in  the  prevailing  practice  of  piece  rate 
is  that  the  time-required  basis  of  the  rate  is  usually,  in  fact  almost 
always  on  new  work,  estimated  far  too  liberally.    There  are  a  variety 
of  reasons  for  this :  for  one  thing,  the  desire  to  enable  men  new  to 
the  work  to  earn  good  pay  from  the  start.    (A  commendable  object 
that  should  be  achieved  by  another  method,  by  paying  a  learner's 
retaining  fee.)    But  chief  of  all  is  the  lack  of  proper  definition  of 
the  job  before  the  time  estimate  is  made.    Indeed,  such  is  the  usual 
absence  of  any  attempt  at  adequate  standardization  of  the  job  — 
predetermination  of  proper  speed  and  feed  of  the  machine,  quality 
of  the  material,  appliances  to  be  used,  motions  of  the  workman— 
that  the  conditions  under  which  the  work  is  to  be  performed  are 
quite  in  the  air,  and  it  is  a  euphemism  to  say  that  the  necessary 
time  to  be  taken  is  "estimated."   It  is  merely  guessed  at,  and  even 
the  guessing  is  not  done  with  respect  to  anything  that  is  definite. 
Accordingly,  as  soon  as  the  workman  becomes  thoroughly  habitu- 
ated to  the  work  and  the  job  itself  is  "smoothed  out,"  it  is  commonly 
found  that  it  can  be  done  easily  in  much  less  time  than  that  embodied 
in  the  rate.    If  nothing  holds  the  workman  back  from  doing  what 
he  can  do,  he  goes  ahead  taking  up  slack  until  presently  there  is 
such  a  saving  of  time  that  his  earnings  mount  to  "time  and  a  third  " 
"time  and  a  half,"  "double  time,"  or  even  more.  ' 

It  is  to  be  noted  that  such  is  the  cumulative  effect  of  doing  work 
in  the  time  saved  and  getting  pay  for  it  that  the  workman's  earn- 
ings for  any  pay  period  increase  in  accelerated  ratio  with  the  time 
saved.  To  earn  "time  and  a  half,"  even  under  piece  rate  with  no 
bonus  factor,  it  is  not  necessary  for  the  workman  to  reduce  his  time 
of  performance  by  50  per  cent  of  the  time  embodied  in  the  rate  but 
by  only  S3}i  per  cent  of  that  time.   If  he  should  cut  the  time  in 


PROTECTION  OF  PIECE  RATE 


Ir 


209 


half  (not  at  all  an  uncommon  accomplishment,  even  where  the  time 
is  supposed  to  have  been  set  "close"),  his  earnings  when  he  is  work- 
ing consistently  at  that  speed  would  become  "double  time."    He 
would  then  repeat  the  job  we  figured  above  four  times  instead  of 
twice  in  a  ten-hour  day,  or  would  turn  out  2000  pieces  and  be  paid 
for  a  day's  work,  at  four  tenths  of  a  cent  per  piece,  $8  (or  double  S4, 
which  was  "time").  But  in  the  example  before  us  the  workman  is 
entitled  to  five  tenths  of  a  cent  per  piece,  a  rate  that  contains  a 
25  per  cent  bonus  factor.  So,  then,  if  he  turns  out  2000  pieces  a  day 
instead  of  1000  (through  a  saving  of  time  of  50  per  cent)  he  will 
earn  $10  a  day  or  "double  time  and  a  half,"  instead  of  the  "time 
and  a  quarter"  (S5)  that  he  was  supposed  to  be  able  to  earn.  It  is 
evident,  therefore,  that  a  bonus  factor  as  high  as  25  per  cent  cannot 
be  embodied  in  a  piece  rate  with  prudence,  unless  the  time-required 
basis  be  predetermined  very  accurately  ;  and,  in  fact,  so  high  a  bonus 
factor  would  rarely  be  used  where  usual  rate-fixing  methods  are 
employed.    Also  it  is  clear  that  with  or  without  a  liberal  bonus  factor 
the  root  of  the  difficulty  with  piece  rate  is  miscalculation  of  the 
time-required  basis  of  the  rate.    Errors  in  favor  of  the  workman  in 
estimating  the  time  required  are  obviously  costly  to  the  employer 
and  must  often  result  in  extravagant  earnings.    And  when  such  ex- 
travagant, "out-of-line"  earnings  do  occur,  the  next  thing  that  hap- 
pens, of  course,  is  that  the  piece  rate  is  cut  to  reduce  the  workman's 
wages  to  what  is  reasonable.    The  opposite  also  frequently  occurs 
by  reason  of  the  time  required  being  estimated  "short,"  entailing 
that  under  the  rate  established  the  workman  cannot  make  even  his 
"time."  Piece  rate  is,  in  fact,  a  nicely  balanced,  unstable  method 
of  paying  wages,  requiring  fine  calculation  and  adjustment  to  give 
satisfactory  results ;  and  under  the  prevailing  hasty,  inexact  prac- 
tice the  fine  adjustment  called  for  is  made  after  the  rate  is  set  and 
"tried  out"  instead  of  previously  as  it  should  be.    There  are,  to  be 
sure,  a  considerable  number  of  industries  with  well-established  piece- 
rate  scales  changed  infrequently.    But  generally  speaking  there  is  a 
vast  amount  of  tinkering  to  correct  the  error  of  badly  set  rates. 
Raising  the  rates  to  make  them  right  does  little  harm;  it  is  the 
lowering  or  "cutting"  of  the  rates  which  works  mischief— a  mis- 
chief that  can  hardly  be  exaggerated,  for  it  means  the  utter  de- 
moralization of  the  workman. 


i  'Mi 


HHI 


210       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Before  we  proceed  to  further  discussion  of  the  effect  of  rate-cutting 
upon  the  workman,  let  us  first  examine  into  the  question  of  its 
justification.    It  is  often  alleged  that  an  error  of  liberality  in  setting 
a  piece  rate  is  not  costly  to  the  employer,  that  he  "doesn't  lose  any- 
thing by  it,"  but  even  gains.   Now  of  course  if  the  employer  had 
occasion  to  compare  merely  the  performance  and  earnings  of  his  own 
workmen  in  any  class  of  piecework  relatively  to  each  other,  it  is  true 
that  the  speediest  and  highest-paid  man  of  the  group  would  be  the 
most  profitable  man.  The  labor  cost  per  unit  of  his  product  is  no  more 
than  that  of  the  slowest,  and  the  overhead  expense  per  unit  is  much 
less.    But  the  employer  usually  is  compelled  by  competition  to  com- 
pare his  pay  roll  as  a  whole  with  those  of  his  rivals.    He  cannot  keep 
on  paying  extravagant  wages  and  continue  in  business.    If  his  rival 
has  guessed  better  than  he  has  in  setting  his  piece  rates^  he  must 
reduce  his  own  so  that  the  earnings  of  his  men  collectively  will  be  in 
line  with  those  of  the  rival.    Moreover,  the  employer  has  occasion 
to  make  comparisons  between  different  grades  of  piece-rate  workers, 
and  between  workmen  and  foremen,  within  his  own  establishment. 
If  some  of  his  workmen  are  earning  what  is  right  by  piece  rates 
properly  set  and  others  are  earning  extravagant  wages  by  piece  rates 
that  are  improperly  set,  the  effect  will  be  jealousy  and  bickering. 
The  earnings  must  be  harmonized  to  keep  the  peace.    Also  it  is  a 
scandal,  subversive  of  discipline  and  calling  for  remedy,  when  the 
extravagant  piece-rate  earnings  of  workmen  cause  them  to  have  more 
money  in  their  pay  envelopes  than  the  foremen  have  in  theirs.    It 
therefore  comes  about  that  as  long  as  errors  are  made  in  estimating 
the  time  basis  of  piece  rates,  piece  rates  will  have  to  be  cut.    This 
statement  is  central  to  the  main  argument  of  this  paper.    Piece  rates 
by  and  large  in  industry  will  have  to  be  cut :  there  are  reasons — 
ample,  controlling,  permanent  reasons.    It  is  of  no  use  railing  at 
employers  and  their  rate-setters   for  their  alleged  "stupidity"  in 
cutting  rates.   It  is  of  no  use  preaching  up  the  Golden  Rule  to 
industrial  managers  as  a  remedy  for  rate-cutting.   As  long  as  rates 
are  set  as  they  usually  are  they  will  have  to  be  cut. 

But,  say  the  proponents  of  "scientific  management,"  piece  rates 
need  not  be  "set  as  they  usually  are";  they  may  be  and  should  be 
set  by  "time  study,"  and  then  the  rates  can  stand.  Apart  chiefly  from 
overlooking  the  effects  of  competition  in  a  changing  world,  this  is  a 


PROTECTION  OF  PIECE  RATE 


211 


logical  position.  The  idea  is  that  by  means  of  thorough  standardiza- 
tion of  the  job,  which  always  precedes  a  proper  time  study,  and  by 
the  time  study  itself,  the  rate-setter  ascertains  in  advance  the  amount 
of  slack  that  can  be  taken  up  in  doing  the  work  and  so  discovers 
the  exact  time  required.  With  that  information  he  then  sets  a  rate 
under  which  it  is  impossible  for  the  workman  to  make  extravagant, 
runaway  earnings.  Such  is  the  confidence  of  scientific-management 
men  in  the  accuracy  of  time  study  (together  with  overlooking  or  min- 
imizing the  effect  of  changes  in  the  competitive  situation),  that  wher- 
ever piece  rates  are  set  by  that  method  a  definite  promise  is  made 
in  writing  to  the  workmen  on  each  job  that  the  rate  will  never  be  cut, 
unless  the  job  changes  its  character  so  that  it  becomes  a  new  job. 

The  present  writer  is  a  believer  in  time  study  and  has  had  direct 
experience  with  it.    He  is  of  the  opinion  that  it  holds  much  promise 
for  the  future  betterment  of  industrial  relations.   Nevertheless,  it  has 
its  limitations  and  does  not  invalidate  the  position  taken  above,  that 
in  industry  in  general,  in  the  future  as  in  the  past,  piece  rates  will 
have  to  be  cut.    For  one  thing  the  expense  of  time  study,  properly 
performed,  places  bounds  to  its  extension  in  the  field  of  industry. 
Also  the  accuracy  of  its  methods  and  the  permanency  of  its  results, 
under  actual  working  conditions  in  industry,  are  not  as  great  as  the 
theory  of  the  device  calls  for.    Under  time  study,  errors  are  made 
in  setting  rates,  sometimes  serious  errors,  and  it  is  therefore  a  dan- 
gerous practice  to  make  in  good  faith  definite  written  promises  that 
the  rate  will  "never"  be  cut  "unless  the  nature  of  the  job  changes." 
And  this  last  qualifying  clause  in  the  agreement  presents  a  large  op- 
portunity for  evasion  on  the  part  of  the  unscrupulous  employer  or 
his  overzealous  rate-setter.   Anyone  having  the  slightest  acquaint- 
ance with  the  details  of  workshops  kno.vs  that  no  end  of  "nibbling" 
of  rates  can  be  introduced  through  the  expression  "unless  the  nature 
of  the  job  changes."    I  am  aware  that  the  danger  here  is  guarded 
against  in  genuine  scientific-management  shops  by  certain  methods 
(the  use  of  the  so-called  instruction  cards),  but  these  methods  may 
fall  into  disuse  through  the  carelessness  of  subordinates,  and  the 
honest  purpose  of  the  proprietor  may  not  endure.    In  any  shop 
after  a  time  there  may  come  a  king  who  "knew  not  Joseph."    In 
short,  such  is  the  effect  of  multitudinous  details,  technical  and  com- 
petitive change,  carelessness,  excessive  zeal,  and  human  greed  that 


f, 


m 


IllJitii! 


11  i  ^ 
ir 


212        TRADE  UNIONISM  AND  LABOR  PROBLExMS 

time-study  methods  cannot  be  depended  upon  to  abolish  rate-cutting, 
even  where  the  expense  of  those  methods  does  not  preclude  their 
use.  Rate-cutting  emerges  from  the  nature  of  things  industrial ; 
neither  old  nor  new  devices  of  rate-setting  can  secure  the  inviolate 
maintenance  of  piece  rates.  The  protection  of  piece  rate  (removal 
of  the  chief  evil  connected  with  piece  rate)  must  therefore  come 
about  not  through  vain  attempts  to  abolish  rate-cutting  but  through 
the  adoption  of  appropriate  methods  of  safeguarding  the  interests  of 
labor  when  rates  are  cut. 

The  effect  of  rate-cutting,  as  now  practiced  without  safeguards, 
upon  the  individual  workman  directly  affected  and  upon  the  whole 
body  of  workmen  throughout  industry  is  lamentable.  Whether  the 
employer  does  it  arbitrarily  and  aboveboard,  or  whether  he  does 
it  underhandedly  by  means  of  tricks  and  evasions,  either  way  its 
primary  effect  is  virtually  to  fine  the  workman  for  ingenious  and 
speedy  work  (as  it  inevitably  appears  to  him)  and  to  bring  it 
about  that  he  and  his  fellows  do  more  work  (deliver  more  units  of 
effort)  for  less  pay.  By  reason  of  rate-cutting,  as  Sidney  Webb  has 
said,  a  "subtle  degradation"  goes  on  with  respect  to  any  standard 
rate,  linking  pay  with  effort,  that  the  workmen  seek  to  maintain. 
The  secondary  effect  with  respect  to  workmen  is,  of  course,  that  they 
seek  to  safeguard  their  interests  against  this  attack ;  and  they  do  so 
by  means  of  a  whole  system  of  reprisals.  The  characteristic  form  of 
these  reprisals  is  deliberate  limitation  of  output — purposeful  "sol- 
diering" in  its  various  aspects.  Also  there  is  opposition  to  putting 
time  work  on  piece  rate  where  it  should  be  ;  and,  furthermore, 
especially  in  England,  there  is  opposition  to  proper  analysis  or  "rout- 
ing" of  work  which  would  lend  itself  totheintroductionof  piece  rate. 
There  are,  of  course,  as  already  stated^  some  establishments  where  the 
evil  of  rate-cutting  has  been  at  a  minimum  and  where  in  consequence 
little  limitation  of  output  obtains.  But  the  general  situation  in  in- 
dustry, both  with  and  without  labor  organization,  is  one  of  widely 
ramifying  open  or  covert  war  against  output,  resulting  in  huge 
amounts  of  wealth-not-created.  The  evil  of  limitation  of^utput  is 
complicated  with  the  lay-off  evil  (which  has  its  own  appropriate 
remedy)  ;  nevertheless  its  chief  continuing  cause  is  unsafeguarded 
rate-cutting.  The  more  intelligent  workmen  know,  of  course,  that 
slow-work  practices  are  no  part  of  a  constructive  program  of  advance 


PROTECTION  OF  PIECE  RATE 


213 


for  labor ;  they  do  these  things  merely  to  meet  the  exigencies  of  the 
existing  situation,  as  a  counter-attack  against  an  attack  made  on 
themselves. 

And  the  great  waste  of  industrial  power  and  loss  of  wealth  to  so- 
ciety, including  the  workers,  is  not  the  only  serious  aspect  of  this 
warfare  originating  chiefly  in  the  cutting  of  piece  rates.  From  the 
great  mass  of  chicaneries  and  injustice,  about  evenly  divided  be- 
tween the  two  sides,  emerges  a  lamentable  and  unnecessary  degrada- 
tion of  the  human  spirit.  It  hurts  all  honorable  workingmen  in  their 
self-respect  to  practice  limitation  of  output.  Moreover,  the  bitterness 
that  prevails  in  workshops  between  the  workmen  with  the  spirit  of 
solidarity  and  the  crass  individualists,  or  so-called  "piece-rate 
hogs,"  is  most  regrettable.  As  one  experienced  and  conservative 
labor  spokesman,  Mr.  Portenar,  has  said:  "A  man  shows  his  naked 
soul  when  he  works  at  piece  rate."  The  "chasers"  and  other  stool 
pigeons  that  many  employers  use  in  their  efforts  to  circumvent  the 
reprisals  of  labor  increase  the  sum  of  hatred  in  the  world  in  a  way 
that  is  not  necessary  to  get  the  world's  work,  rightly  ordered,  done. 
A  workman  has  a  right  to  a  decent  life  in  industry,  and  society  pays 
if  he  fails  to  get  it. 

And  now  to  come  to  the  conclusion  of  the  whole  matter.  It  is 
absurd  for  society,  itself  so  large  a  sufferer,  to  let  industry  go  on 
muddling  in  the  slough  of  this  piece-rate  difficulty  unaided.  With 
hundreds  of  millions,  possibly  billions,  of  lost  wealth  at  stake,  in- 
convenienced by  strikes  and  other  contingent  evils,  it  is  absurd  for 
people  at  large  to  allow  the  parties  in  direct  interest  to  "fight  it 
out"  in  a  war  that  has  no  ending.  Society  has  pursued  the  hands-off 
policy  in  the  past  doubtless  because  it  was  thought  that,  such  was 
the  mass  of  details  involved,  the  state  would  be  incompetent  to 
intervene  to  advantage.  Also  the  serious  difficulty  and  danger  of  gov- 
ernmental interference  in  any  economic  matter  involving  supply  and 
demand  has  been  appreciated.  But  it  is  clear  that  the  state  is  com- 
petent to  intervene  in  this  matter  of  piece  rate  to  advantage,  avoid- 
ing the  details  and  the  ultimate  economic  determinations,  by  laying 
down  fundamental  rules  of  method  and  procedure.  That  is  what 
the  general  body  of  commercial  law  does,  and  all  it  does.  Why  should 
industry  in  the  aspect  before  us  be  allowed  to  continue  to  be  a  bear 
garden?    Organized  society,  the  state,  should  add  to  its  concepts 


,1^ 


m: 


ill 


214       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  law  and  conceive  every  industry  to  be  "affected  with  a  public 
interest,"  and  enact  appropriate  regulations  accordingly.  Piece  rate 
should  be  protected  by  law  based  on  a  general  policy,  as  indicated 
above,  of  prescribing  forms  of  procedure.  No  direct  interference 
with  matters  properly  determined  by  supply  and  demand  (such  as 
the  base  time  wage)  ought  to  be  undertaken;  simply  the  substitution 
of  deiinition  and  publicity  for  indefiniteness  and  secrecy. 

Let  it  be  enacted  into  law,  and  the  means  of  enforcement  pro- 
vided, that  in  every  shop  where  piece  rates  are  used : 

1.  A  list  of  rates  shall  be  published  showing  not  only  the  rates 
themselves  but  the  "elements"  from  which  they  are  derived — the 
definition  of  the  job,  the  time-required  basis,  the  base  time  wage, 
and  the  amount  of  the  bonus  factor. 

2.  A  statistical  accounting  shall  be  kept  of  the  earnings  (or  per- 
formance record )  of  the  individual  workmen  under  each  rate,  and 
audited  at  stated  intervals. 

3.  A  statement  of  the  period  during  which  each  rate  shall  stand 
without  revision  downward  shall  be  made  a  part  of  each  piece-rate 
agreement  and  published. 

4.  The  rules  of  revision,  or  the  limit  to  which  revision  downward 
may  take  place,  shall  be  stated  in  sufficiently  explicit  terms  and 
published. 

For  example,  under  the  last  head,  if  at  the  stated  time  of  revision 
it  shall  be  found  that  the  average  earnings  of  a  group  of  workers 
on  a  certain  piece  rate  have  been  "time  and  two  thirds"  (or  some 
other  predetermined  amount)  the  rate  may  be  cut,  but  only  to  a 
point  that  will  yield  the  average  worker  "time  and  one  third"  (or 
some  other  predetermined  amount)  as  shown  by  the  average  of  the 
performance  records.  That  is,  the  new,  reduced  rate  shall  be  so  set  on 
the  basis  of  the  average  speed  attained  by  the  group  that  a  certain 
standard  of  pay  is  safeguarded.  Contrariwise,  at  the  stated  time  of 
revision  (or  between  times)  any  rate  that  is  found  to  yield  average 
earnings  below  the  standard  of  pay  aimed  at  shall  be  revised  upward. 

A  somewhat  elaborate  code  will  have  to  be  developed  to  protect 
the  interests  of  the  employers  as  well  as  those  of  the  workmen  in 
the  application  of  the  foregoing  principles.  The  principles  or  leading 
rules  themselves  will  require  amplification.  For  one  thing,  there  is 
the  problem  of  what  to  do  with  small  groups  or  single  workers  where 


PROTECTION  OF  PIECE  RATE 


215 


I 


the  law  of  averages  is  not  available.    In  such  cases  there  should  be  a 
lump-sum  payment  in  compensation  for  loss  of  earnings  when  a  piece 
rate  which  yields  extravagant  wages  is  reduced.    The  method  em- 
ployed might  be  capitalization  of  the  excess  earnings  considered  as 
an  annuity  on  the  basis  of  some  predetermined  rate  of  interest.  Then, 
again,  there  is  the  question  of  what  procedure  should  be  followed 
when,  as  often  happens,  a  high-grade  piece-rate  workman  is  tem- 
porarily placed  on  a  low-grade  piece-rate  job.    The  rules  for  such 
special  assignments  should  be  predetermined  and  published.  A  special 
higher  rate  for  the  job  cannot  (without  creating  jealousy)  be  offered 
in  such  cases  for  the  benefit  of  the  particular  workman ;  his  custom- 
ary earnings  must  therefore  be  safeguarded  by  calculating  how  much 
he  ought  to  earn  with  due  diligence  by  the  established  rate  and  then 
adding  to  this  a  fixed  time-wage  retainer.    To  illustrate :  his  custom- 
ary piecework  earnings  per  hour  are  50  cents;   what  he  can  be 
reasonably  expected  to  earn  per  hour  at  the  temporary  piecework  is 
30  cents ;  the  guaranteed  hourly  retainer,  which  he  would  supple- 
ment by  his  own  efforts,  would  be  20  cents.   Where  such  a  retainer 
is  not  paid  in  these  cases,  usually  the  workers  "soldier"  to  a  degree 
(as  I  have  myself  seen)  which  is  the  despair  of  foremen.    Workers 
always  resent  injustice  in  wage  matters  and  commonly  endeavor  "to 
get  even,"  although  with  honorable  employers  of  course  no  injustice 
is  intended.    The  rules  of  order  and  publicity  suggested  above  would 
be  opposed  by  many  employers,  and  yet  undoubtedly  they  would  be 
to  the  advantage  of  employers  as  well  as  wage-earners.    It  is  to 
the  interest  of  everybody  that  ways  and  means  be  found,  as  they 
can  be,  covering  all  circumstances  to  encourage  piece-rate  workers 
to  do  their  best.    These  ways  and  means  will  not  be  found  by  the 
general  mass  of  managers  of  industry  working  without  assistance. 
The  chief  practical  difficulties  in  a  general  plan  for  protection  of 
piece  rate  will  be  those  which  will  arise  from  the  necessity  of  estab- 
lishing proper  uniformities  and  proper  diversities  in  piece-rate  scales 
as  between  one  shop  and  another  in  the  same  district  and  as  between 
different  districts  for  a  whole  national  industry.    Here,  again,  I  think 
the  state  should  require  published  rules  of  procedure,  but  these  rules 
would  have  to  be  arrived  at  through  organized  employers  and  or- 
ganized employees  freely  using  the  methods  of  collective  agreement. 
As  for  that  matter,  the  whole  body  of  rules  suggested  above  for  the 


m 


iti 


216       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

protection  of  piece  rate,  primarily  in  the  workers'  interest,  will  have 
to  rest  ultimately  (although  the  state  takes  the  initiative)  upon  the 
basis  of  unionism  and  the  practice  of  collective  bargaining.  Not  only 

must  all  the  cards — not  some  of  them,  but  all  of  them be  placed 

on  the  table  to  protect  piece  rate  in  the  workers'  interest,  but  also 
the  workers  must  have  adequate  control  as  to  what  those  cards  shall 
be.    The  representatives  of  the  organized  workers  should  inspect 
the  methods  of  determining  the  time  required  on  piece-rate  jobs  • 
they  should  pass  upon  the  bonus  factor  ;  they  should  audit  the  record 
of  earnings ;  and  above  all  they  should  have  a  say  as  to  the  base 
time  wage  embodied  in  each  piece  rate.    The  labor  organization  and 
the  mechanism  of  collective  bargaining  and  representation  sufficient 
to  perform  these  tasks  (not  merely  to  satisfy  labor  but  because  logic 
and  right  reason  demand  it)  will  have  to  rest  on  a  broader  basis  than 
mere  individual  workshop  boards  or  committees.    To  solve  the  piece- 
rate  problem,  and  all  the  other  problems  of  industrial  life,  there 
must  be  indeed  unionism  broadly  established  and  recognized  and  sup- 
ported by  society.    Society  must  realize  that  the  manifold  interests 
of  working  men  and  working  women  in  every  shop  cannot  be  ade- 
quately protected   unless   they  appear   before   their  employers   by 
counsel.    The  outsider,  an  official  of  the  intershop  union,   is  not 
strictly  an  analogue  of  legal  counsel  (he  brings  his  own  interests  into 
the  case)  :  nevertheless  that  term  is  useful  as  indicating  the  nature 
of  the  function  of  expert  assistance  which  he  renders  his  clients  in 
any  shop.    The  workingman,  when  engaged  in  buying  his  wage  by 
the  exchange  of  his  mental  and  physical  effort,  often  needs  to  be 
coached  as  to  his  demands,  and  he  has  therefore  the  occasion  and 
the  right  to  employ  counsel  to  examine  into  all  the  conditions  of 
the  deal  and  through  him  to  state  what  terms  he  is  willing  to  accept. 
And   not   only   should   the   workingman   have   the   right    to   do 
business  with  his  employer  by  counsel   (through  the  official  of  his 
union)  but  he  should  actually  do  so.    Therefore,  in  the  absence  of  a 
union  (as  is  often  the  case,  especially  with  women  workers  and  the 
sweated  trades  generally),  the  state  itself  should  appoint  such  coun- 
sel, similarly  to  what  is  often  done  in  criminal  trials.    Is  it  not 
absurd   that   in  the  multitudinous  industrial   cases,  so  vastly  im- 
portant in  the  aggregate,  hundreds  of  thousands  of  workers  who 
most  of  all  need  expert  defense  are  left  without  any  ?    The  hands- 


PROTECTION  OF  PIECE  RATE 


217 


off  policy,  the  "let  them  fight  it  out"  policy  in  these  matters  must 
be  absolutely  abandoned,  not  merely  in  the  interest  of  the  workers 
but  in  the  interest  of  the  employers  and  of  all  of  us.  Of  recent  days 
events  have  brought  a  condition  under  which  industry  will  profit 
greatly  by  a  speedy  introduction  of  the  "common  rule"  mto  all 
matters  affecting  remuneration  of  labor  and  other  conditions  of  em- 
ployment. Employers,  legislators,  courts,  all  of  us,  should  get  some 
new  concepts  with  respect  to  labor  organization  and  labor  standards 
and  act  upon  them  without  delay.  Order  should  be  introduced  mto 
a  realm  where  hitherto  there  has  been  anarchy. 

These  last  matters  are  to  a  degree  collateral  to  the  proposals  made 
above  for  compulsory  rules  of  procedure  and  publicity  with  respect 
to  piece  rate.    Further  discussion  of  them  is  therefore  out  of  place 
here    What  I  wish  to  emphasize  now  is  that,  however  necessary 
collective  bargaining  may  be  as  the  basis  of  adequate  protection  of 
piece  rate  in  the  'worker's  interest,  published  rules  of  procedure  re- 
quired by  law  as  set  forth  above  are  also  necessary  to  the  protection 
of  piece  rate  in  society's  interest.    So  long  as  the  methods  of  piece 
rate  are  left  in  an  undefined,  chaotic  condition  there  is  grave  danger 
that   collective   bargaining   operating   under   such   conditions   may 
seek  to  solve  the  tangled  problem  in  reactionary  and  harmful  ways. 
It  is  abundantly  clear  from  evidence  published  of  late  that  in  the 
engineering  trades  in  Great  Britain,  for  example,  organized  labor 
has  protected  piece  rate  not  by  intelligent  regulation  but  by  stub- 
born opposition  to  its  introduction  and  by  outrageous  practices  of 
limitation  of  output.    The  whole  situation  was  apparently  too  con- 
fused to  admit  of  intelligent  regulation ;  there  was  no  foundation  or 
preparation  for  the  proper  exercise  of  the  forms  of  collective  bar- 
gaining   What  is  needed  everywhere  first  of  all,  therefore,  to  prevent 
such  things  from  happening  is  the  letting  in  of  the  light,  the  opening 
up  of  the  subject  for  proper  handling,  by  the  laws  suggested,  which 
will  compel  the  piece-rate  accounting,  the  publication  of  the  scales, 
the  definition  of  the  jobs,  and  in  short  the  whole  analysis  of  the 
piece-rate  problem  into  its  "elements."    Then  upon  such  a  basis  can 
come  the  follow-up  of  collective  bargaining  properly  applied,  and, 
when  necessary,  public  arbitration  intelligently  applied. 

Charles  W.  Mixter 

Clark  College 


rrfffi^  I 


.?)iii 


NON  FINANCIAL  INCENTIVES 


i 


219 


XVII 

NONFINANCIAL  INCENTIVES^ 

THE  basis  of  all  "nonfinancial  incentives"  is  interest  in  work. 
jnterestuTwofk:  implies  a  destre  to  pro^ce  actuated  by  rnler- 

nal  motlveslitlier  than  external  discipline. ' 

Production  means  creation,  and  the  industrial  creative  function 
in  man  is  a  mental  process  and  lies  in  his  intelligent  adaptation  of 
means  to  ends.  It  is  useless,  therefore,  to  look  for  real  creative 
work  unless  the  workman  has  a  chance  to  think  and  to  plan ;  any 
other  working  environment  either  fails  to  attract  or  actually  repels 
the  workman,  and  as  a  consequence  offers  no  incentive  to  increased 
effort. 

Work  which  does  not  call  for  thoughtful  reflection,  and  which 
uses  only  muscular  effort,  tends  to  draw  man  down  to  the  level  of  the 
brute  and  makes  for  industrial  irresponsibility  and  consequent  social 
disorganization.    The  unthinking  man  cannot  be  a  responsible  man. 

It  is  the  self-conscious  faculty  of  man  which  distinguishes  him 
from  the  animal  and  makes  him  above  all  a  creative  center  through 
which  the  universal  life-giving  power  can  deal  with  a  particular 
situation  in  time  and  space. 

To  use  a  homely  illustration  with  which  everyone  is  familiar, 
the  traffic  at  each  crowded  street  crossing  cannot  be  regulated  from 
the  City  Hall ;  it  requires  an  individual  (the  traffic  policeman)  in  the 
congested  spot  to  deal  with  each  particular  situation  as  it  arises, 
and  upon  his  powers  of  observation  and  selection  depends  the  orderly 
flow  of  traffic. 

JiJs  only  through  the  individual  life  that  the  universal  life  can 
act,  and  therefore  the  universal  is  compelled  to  evolve  many'lndi- 
vidual  lives  if  organization  and  order  are  to  replace  the  unorganized 
state  represented  by  the  purely  generic  operation  of  natural  law. 

The  problem  of  sodal   organization  is,   then,  how   to  organize 

iprom  Publications  of  the  American  Society  of  Mechanical  Engineers, 
No.  1673  (1918). 

218 


society  upon  the  basisof  respect  for  the  individual.  This  is  also  the 
iMustrTaT  problem  as  well,  lor  industry  in  the  broadest  sense  is 
society  in  its  highest  form  of  activity,  because  it  is  essentially  con- 
structive and  therefore  creative  activity. 

It  was  an  inevitable  corollary  to  the  universal  plan  of  creation 
that  the  individual  life  came  into  being  not  to  create  material  sub- 
stance, as  that  had  to  be  before  individual  life  could  gain  conscious- 
ness. The  function  of  the  individual  life,  however,  is  to  create  by 
a  thought  process  conditions  especially  selected  to  produce  results 
which  nature  unaided  would  fail  to  produce. 

This  is  what  the  horticulturist  does.  His  power  lies  in  his  knowl- 
edge of  natural  law,  and  his  creations  are  made  possible  because  he 
conforms  to  the  law.  The  uncultivated  orchard  reverts  to  its  original 
wild  state  when  no  longer  attended  by  man,  but  increases  in  pro- 
ductiveness by  continued  thoughtful  application  of  man's  power  of 
selection  and  adaptation. 

It  is  by  a  similar  process  of  conscious  selection  that  such  devices 
as  the  steamboat,  steam  engine,  electric  generator,  and  the  telephone 
came  into  existence.  They  did  not  come  into  being  and  never  would 
have  been  created  by  the  generic  operation  of  nature's  laws. 

To  illustrate  further :  The  desire  of  the  savage  to  cross  a  body  of 
water  too  wide  for  him  to  swim  caused  him  to  observe  the  floating 
of  things  which  floated  naturally.  As  a  result  of  this  observation  he 
built  a  raft ;  and  finally,  by  further  observation,  he  discovered  the 
principle  that  anything  which,  bulk  for  bulk,  was  lighter  than  the 
water  it  displaced  would  float,  and  although  he  perhaps  uncon- 
sciously applied  this  principle,  it  is  true  that  from  its  application 
he  evolved  the  canoe. 

It  is  by  a  continuation  of  the  application  of  this  same  law  that, 
almost  within  our  own  memory-,  it  has  been  made  possible  for  the 
vessels  of  the  world  to  be  built  of  iron,  something  which  the  old 
shipbuilders  thought  impossible.  We  see  then  that  it  is  the  applica- 
tion of  the  personal  factor  that  now  makes  iron  float  by  the  use  of 
the  very  same  law  that  makes  it  sink. 

Upon  a  higher  plane  the  modern  electric  generator  was  evolved 
by  observing  that  a  wire  passed  at  right  angles  through  a  magnetic 
field  would  induce  an  electric  current  to  flow  through  it  in  a  certain 
direction. 


ii\ 


m^ 


220       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

It  was  only  by  creating,  through  the  application  of  the  personal 
factor,  conditions  by  which  this  law  could  be  expanded  that  electric- 
ity was  generated  commercially.  The  electric  generator  is  nothing 
more  than  a  large  number  of  such  wires,  insulated  one  from  another, 
passing  in  and  out  of  a  number  of  magnetic  fields,  plus  a  device 
for  collecting  and  conducting  away  the  current  generated.  The 
important  point  to  remember  is  that  there  never  would  have  been 
an  electric  generator  without  the  introduction  of  the  individual 
personalities  who  literally  created  it. 

In  this  connection  it  is  well  to  observe  that  all  of  our  creations, 
if  they  are  to  be  successful,  depend  upon  the  strict  observance  of  the 
laws  of  nature.  When  we  clearly  see  man's  place  in  the  universal 
life  movement,  we  can  understand  why  it  was  that  in  the  long  process 
of  evolution  it  was  inevitable  that  a  being  capable  of  measuring  by 
reflection  be  evolved.  The  very  word  "man"  is  derived  from  an 
Aryan  root  meaning  "to  measure." 

All  this  may  seem  at  first  sight  far  removed  from  the  problem 
of  "nonfinancial  incentives,"  but  it  seems  to  me  it  is  necessary  before 
proceeding  further  to  gain  some  conception  of  the  reason  for  man's 
existence.  The  concrete  illustrations  of  the  operations  of  non- 
financial  incentives  will  then  have  greater  meaning, 

Man,  through  the  exercise  of  his  intellectual  faculties  so  laboriously 
acquired  through  ages  of  slow  evolution,  literally  reflects  the  uni- 
versal creative  process  upon  the  plane  of  the  particular.  There  can 
be  no  organization  of  material  substance  except  through  an  indi- 
vidual who  can  observe  the  laws  inherent  in  the  materials  them- 
selves. Then,  by  a  process  of  reflection,  these  materials  can  be 
organized  into  forms  which  they  could  not  take  unaided  by  the  in- 
dividual will  or  a  power  external  to  themselves. 

To  state  the  matter  more  concretely:  man,  we  know,  cannot 
bring  matter  into  existence,  neither  can  he  create  the  force  which 
resides  in  the  physical  elements  he  uses  in  the  day's  work ;  what  he 
does  is  to  observe  nature's  forces  in  action  and  then,  having  learned 
the  laws,  that  is,  the  reasons  for  their  action  in  any  particular  direc- 
tion, he  seeks  for  means  to  make  them  express  themselves  more 
fully. 

This,  of  course,  necessitates  the  creation  of  conditions  which  do 
not  occur  spontaneously  in  nature.   We  have  here  the  beginning 


NON FINANCIAL  INCENTIVES 


221 


I: 


of  what  we  call  the  artificial,  and  it  is  significant  that  the  highest 
type  of  this  form  of  creation,  upon  a  higher  plane  than  the  natural, 

is  termed  art. 

This  creation  of  artificial  conditions  which,  taken  all  together, 
we  call  civilization  is  of  course  the  product  of  man's  organizing 
power.  While  self -consciousness,  the  power  of  realizing  the  self 
as  apart  from  the  rest  of  the  universe,  has  been  a  human  faculty 
for  untold  ages  before  the  present  highly  organized  state  of  society 
had  been  attained,  it  is  nevertheless  true  that  now,  for  the  first 
time  in  the  history  of  the  white  race,  we  are  confronted  with  the 
problem  of  correcting  the  repressive  or  selfish  character  of  civiliza- 
tion so  that  it  will  serve  the  mass  of  humanity.  If  we  fail  to  accom- 
plish this  it  will  be  destroyed  by  the  same  creative  power  which 
brought  it  into  existence. 

We  must  learn  how  to  change  the  industrial  environment  from 
one  which  repels  mankind  to  one  which  attracts.  In  other  words, 
the  incentive  to  work  must  be  inherent  in  the  nature  of  the  work 

itself. 

Now  what  are  the  conditions  which  we  must  meet  in  the  industrial 
world  to  make  work  attractive?  We  have  ample  evidence  that 
increasing  financial  returns  have  failed  to  stimulate  productivity, 
and,  on  the  other  hand,  the  constant  demand  for  shorter  hours  and 
the  increasing  labor  turnover  are  proof  that  work  in  most  of  our  in- 
dustries not  only  does  not  attract  but  actually  repels  the  workman. 
We  must  therefore  look  into  the  working  conditions  themselves  for 
the  answer.   This  is  the  only  scientific  method  of  procedure. 

I  should  like  to  quote  from  a  letter  received  from  a  very  intelligent 
labor  leader  recently,^  to  show  how  the  mass  of  employees  look  at  the 
problem  and  how  urgent  is  the  need  for  its  immediate  solution  if 
we  are  not  to  have  a  greatly  reduced  production  of  the  necessities 
of  life  brought  about  by  the  concerted  action  of  the  workers : 

Is  it  not  true  that  the  industrial  evolution  which  has  brought  the 
trusts  into  existence  has  been  the  means  of  eliminating  the  "  human 
touch"  in  industry  ?  During  the  days  of  small  industrial  plants  the 
employer  and  the  employee,  of  course,  were  really  fellow  workmen. 
At  the  present  time,  however,  the  employee  has  perhaps  never  seen 
any  of  the  stockholders  of  the  industrial  plant  where  he  is  employed. 

ijohn  P.  Burke,  International  President,  Pulp  Sulphite  and  Paper  MiU 
Workers'  Union. 


f 


J  a 


222       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

You  say  that  men  can  be  productive  only  when  they  take  an 
interest  in  their  work,  and  they  will  not  take  this  interest  unless  those 
intrusted  with  the  direction  of  their  efforts  realize  that  they  must 
teach  them  constantly  how  to  exercise  their  creative  powers. 

While  I  agree  with  everything  you  say  relative  to  creative  work, 
and  have  thought  along  these  lines  considerably  myself,  still,  is  it 
possible  in  industries  as  they  are  constituted  at  present  to  enable 
the  average  workingman  to  do  creative  work?  Isn't  it  true  that 
industry  is  becoming  so  specialized  that  the  workman  is  no  longer 
a  creator?  I  realize  that  while  it  may  still  be  possible  for  the 
workman  doing  certain  jobs  in  the  mill  to  do  creative  work,  to  a 
certain  extent,  still  isn't  the  tendency  of  modern  industry  more  and 
more  toward  making  the  workman  simply  an  appendage  of  the 
machine  ? 

In  the  paper  you  sent  me  you  described  how  you  designed  a  plan 
for  the  men  operating  the  hydraulic  press  to  take  an  interest  in  their 
work.  This  certainly  is  a  practical  illustration  of  what  can  be  done 
and  perhaps  could  be  cited  as  a  refutation  of  what  I  have  just 
written  above.  I  realize  that  there  may  be  certain  jobs  in  the  mill 
where  the  creative  powers  can  still  be  allowed  to  develop  and  where 
the  workman  may  be  given  a  chance  to  express  his  individuality, 
but  the  point  I  am  trying  to  bring  out  is  that  the  tendency  of 
modern  industry  is  away  from  creative  efforts  and  gives  the  work- 
man less  and  less  opportunity  for  individual  development.  When  I 
worked  in  the  factories,  which  I  did  from  the  age  of  twelve  to 
twenty-five,  one  of  the  things  I  found  the  most  dissatisfaction  with 
was  the  deadening  sameness  of  the  work.  I  never  remember  a  time, 
when  working  in  the  factories,  that  I  became  so  interested  in  my 
work  that  I  didn't  long  for  quitting  time  to  come.  After  leaving 
factory-  work  I  got  a  job  with  a  building  contractor.  As  I  became 
more  proficient  as  a  carpenter,  I  have  time  and  again  been  put  doing 
certain  work  that  was  more  or  less  creative,  in  which  I  have  become 
so  interested  that  I  paid  no  attention  to  quitting  time  and  have 
worked  for  two  or  three  hours  after  the  time  when  I  might  have  quit 
work.  There  is  joy  in  creative  work.  But,  in  my  opinion,  no  matter 
what  schemes  we  may  devise,  modern  industry  is  going  to  tend  more 
and  more  to  make  simply  automatons  of  men. 

I  may  say,  however,  that  I  could  find  very  little  to  criticize  in 
either  of  your  articles.  You  have  demonstrated,  from  practical  ex- 
periments, things  that  I  have  often  theorized  about.  The  conflict  in 
industry  during  the  next  few  years,  in  my  opinion,  will  be  between 
the  democratic  and  autocratic  ideas.  The  autocratic  idea,  I  think,  is 
best  exemplified  by  the  German  military  machine. 

I  was  able  to  convince  the  writer  of  the  letter  from  which  I  have 
just  quoted  that  creative  work  could  be  done  to  a  great  extent  in 


NONFINANCIAL  INCENTIVES 


223 


modern  industry,  and,  further,  that  this  could  be  accomplished  with- 
out any  radical  changes  in  equipment,  greatly  to  the  advantage  of 
both  employer  and  employee. 

INDIVIDUAL  PROGRESS  RECORDS 

To  do  this,  individual  progress  records  are  necessary,  so  that  the 
workman  can  know  from  day  to  day  how  he  is  improving  in  the 
mastery  of  the  process. 

The  first  example,  illustrated  by  Fig.  i,  is  from  that  branch  of 
the  wood-pulp  industry  known  as  the  sulphite  process  and  shows 
a  cooking  chart  which  was  designed  to  give  the  cook  information 
about  the  reactions  in  the  digesters  in  which  the  wood  chips  are 
cooked  in  a  6  per  cent  solution  of  sulphurous  acid  partly  combined 

with  a  lime  base. 

The  digesters  have  a  conical  top  and  bottom  and  are  usually 
50  feet  high  by  15  feet  in  diameter.  After  the  acid  and  chips  are  put 
into  the  digester  and  the  cover  is  put  on,  steam  is  turned  in  at  the 
bottom  and  the  pressure  brought  up  to  75  pounds  per  square  inch 
above  atmospheric  pressure. 

As  this  does  not  heat  the  digester  sufficiently  to  produce  disinte- 
gration of  the  wood,  it  is  necessary  to  relieve  gas  through  a  relief 
valve  on  the  cover.  Because  of  the  removal  of  this  gas,  which  is 
afterward  reclaimed,  more  steam  can  come  in  at  the  bottom,  and 
thus  the  temperatures  are  advanced.  The  skill  in  cooking  consists 
in  the  proper  control  of  the  relief  valve. 

Before  the  introduction  of  these  cooking  charts,  illustrated  by 
Fig.  I,  all  this  was  left  to  the  unaided  judgment  of  the  cook,  with 
usually  nothing  to  help  him  but  a  small  hand  thermometer  and  a 
pressure  gage.  Of  course  great  variation  in  the  pulp  was  the  re- 
sult. The  cooking  charts,  plotted  by  the  cooks  themselves,  how- 
ever, helped  greatly,  as  they  enabled  the  quick  visualization  of  the 
work.  On  these  charts  temperatures  are  converted  to  pressures  for 
the  reason  that  the  pressure  in  the  digester  comes  from  two  sources, 
one  the  natural  pressure  due  to  steam  and  the  other  due  to  the 
sulphurous-acid  gas.  The  pressure,  for  instance,  which  would  cor- 
respond to  a  temperature  of  212  degrees  would  be  o,  or  atmospheric, 
yet  from  the  chart  you  will  see  that  the  gage  pressure  actually 


i< 


,1! 


J  n 


11^ 


mMn 


!!f' 


224       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

showed  75  pounds.  The  difference  between  o  and  75,  therefore,  is 
caused  by  the  presence  of  sulphurous-acid  gas.  As  the  cooking 
progresses  the  gas  is  naturally  used  up :  first,  by  being  relieved  for 
the  purpose  of  making  room  for  more  steam  ;  second,  by  the  natural 


HOURS 


TEMP. 


222 


233 


240 


250 


269 


273 


GAGE 
PRESSURE 


0 


20 


48 

75_ 

75 


75 


75 


75 


75 


75 


STEAM 
PHESSURE 


10 


15 

20 


29 
41 


GAS 
PRESSURE 


76 


72 


68 


65 


60 


65 


46 


NAMES  OF  COOKS  AND 

GENERAL  INFORMATION 

FILLED  IN  HERE 


(TOTAL  7.00 

ACID    TEST]  FREE  6.06 

(coMBrNEO         ass 


ACID  TEMPERATURE  75  DEGREES 
FAHRENHEIT 


Fig.  I.   Reaction  in  Digesters  in  which  Wood  Chips  are  Cooked 

combination  of  the  acid  with  the  organic  compounds  liberated  during 
the  cooking  process. 

At  the  end  of  the  cooking  process  the  gage  and  steam  pressures 
will  naturally  come  very  close  together,  as  the  greater  part  of  the  SO  2 
gas  has  been  used.  The  gas-pressure  curve  is  obtained  by  subtract- 
ing the   steam  pressure   from   the  gage  pressure.     It   is   really   a 


NONFINANCIAL  INCENTIVES 


22 


resultant  of  the  other  two.  If  it  drops  too  rapidly  the  cook  knows  he 
is  relieving  his  digester  too  hard  and  checks  the  opening  of  the  relief 
valve.  If  it  does  not  drop  rapidly  enough  he  knows  he  must  open 
the  valve  wider  in  order  to  increase  the  relief.  Of  course  the  figures 
are  taken  from  recording  instruments  which  are  checked  daily  to  in- 
sure accuracy.  Naturally  an  ideal  cooking  chart  was  soon  formed, 
being  the  joint  work  of  the  cooks  handling  the  digesters  and  of  the 
chemical-research  department. 

Immediately  after  the  introduction  of  these  charts  a  very  marked 
increase  in  the  uniformity  of  the  pulp  was  noticed,  and  the  cooks, 
while  at  first  opposed  to  the  new  method  of  "  cooking  with  a  lead 
pencil,"  as  they  called  it,  soon  learned  to  like  their  work  much 
better,  for  the  reason  that  they  now  had  some  way  of  visualizing 
the  work  in  its  entirety.  In  addition  to  more  uniform  quality  of 
the  pulp,  the  yield  from  a  cord  of  wood  increased  something  over 
5  per  cent. 

CONTINUOUS  PROGRESS  RECORD 

We  soon  found  that  it  was  necessary  to  give  some  sort  of  continu-l 
ous  progress  record  if  we  were  to  keep  up  the  interest  in  the  work,  I 
because  no  man  could  carry  in  his  mind  anything  but  a  general  im- 
pression of  his  progress  from  day  to  day.    Several  good  records  for 
one  day  are  only  like  so  many  good  golf  drives.    They  are  a  source 
of  satisfaction  at  the  time,  but  just  as  the  score  in  golf  denotes  our 
real  mastery  of  the  game,  so  does  the  progress  record  measure  the 
man's  increasing  mastery  of  his  work,  and  we  feel  that  it  is  one  of 
the  moral  obligations  of  the  management  to  keep  such  records  for  the 
individual  workman.    Without  these  records  men  will  not  think  of 
improvements  in  the  process,  and  they  cannot  be  blamed  for  becom- 
ing indifferent.    How  long,  for  instance,  would  a  superintendent  or 
manager  retain  his  interest  in  the  economical  operation  of  his  plant 
if  his  cost  sheets  were  withheld?    We,  as  executives,  must  have 
quantity,  quality,  and  economy  records,  otherwise  our  interest  soon 
lags.   Why,  then,  should  we  expect  the  workman  to  be  interested 
when  he  is  not  furnished  with  a  record  which  at  least  reflects  one  of 

these  elements  ?  .      \ 

Such  records  can  be  grouped  under  three  main  headings :  quantity  \ 
records,   quality   records,   and  economy,  or  cost,   records.    Quality    ] 


I' 


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226       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

records,  which_occupy  the  middle  position,  are,  perhaps,  of  the 
greatest  importance,  for  they  bring  the  indivTdual*5  intditgeftee- to 
bearllpoir  the  problem  and  as  a  consequence,  by  removing  the  ob- 
stacles to  uniformity  of  quality,  remove  at  the  same  time  the  obstruc- 
tions to  increased  output.  The  creative  power  of  the  human  mind 
is,  however,  not  content  simply  to  produce  the  best  quality  under 
existing  conditions  of  plant  operation.  The  desire  to  create  new 
conditions  for  the  more  highly  specialized  working  out  of  the  natural 
laws  of  the  process  demands  expression,  and  this  expression  at  once 
takes  the  form  of  suggestions  for  improvements  in  mechanical  devices. 

This  desire  contains  within  it  the  germ  of  economic  thought, 
which  will  unfold  and  express  itself  eventually  in  a  request  for  cost 
records,  and  the  organization  that  neglects  its  opportunity  to  satisfy 
this  desire  is  overlooking  one  of  the  great  avenues  leading  toward 
intelligent  productive  effort. 

Because  of  the  interrelation  of  quality,  quantity,  and  economy 
records,  any  complete  record  of  individual  progress  must,  of  course, 
take  them  all  into  account.  However,  as  this  is  not  always  practical, 
we  have  at  least  one  of  three  ways  of  measuring  progress  always 
open  to  us. 

We  keep  a  continuous  progress  record  of  the  work  which  is  mainly 
one  of  quality.  By  quality  I  do  not  necessarily  refer  to  the  quality  of 
the  material  produced,  as  most  of  our  records  refer  to  the  qual- 
ity of  the  work  performed — in  other  words,  the  nearness  to  which  the 
workman  approaches  the  ideal  standards  which  he  has  helped  to 
form.  The  democratic  cooperative  forming  of  these  standards  by  the 
joint  work  of  the  trained  technician  and  the  practical  workman  is 
absolutely  essential,  otherwise  continuous  progress  will  not  be  made. 
The  whole  plan  must  be  really  educational  in  nature,  and  to  be  so 
the  records  must  record  the  natural  laws  of  the  process  and  the  in- 
dividual's degree  of  control  of  forces  in  the  material  elements  that 
he  is  using.  The  more  factors  that  can  be  recorded,  the  greater  the 
interest  in  the  work.    The  reason  for  this  is  obvious. 

There  are  nine  men  cooking,  the  names  posted  in  the  order  of 
seniority,  with  the  highest  monthly  record  on  top.  There  are  three 
foremen  at  the  top  of  the  record.  Each  of  these  foremen  has  three 
cooks  under  him,  and  their  standing  is  made  up  by  taking  the  average 
records  of  the  men  under  them.    In  this  way  we  are  enabled  to  get 


NONFINANCIAL  INCENTIVES 


227 


Ih 


4 

I 

I 
I 


not  only  the  individual  records  of  the  men  but  the  group,  or  team- 
work records  as  well.  For  the  convenience  of  the  department  head 
in  char-e  a  record  is  kept  which  shows  the  relative  standing  of 
the  large,  medium,  and  small  digesters.  This  is  irrespective  of  the 
men  who  are  working  on  them. 

The  total  progress-record  figures  are  made  up  of  the  temperature, 
color,  time,  and  blowing  records.  The  relative  values  that  these 
have 'in  the  total  record  are  shown  at  the  top  of  each  column,  the 
total  adding  up  to  100.  There  is  but  a  small  variation  in^  the 
monthly-average  column  of  each  worker,  and  this  is  characteristic  of 
all  our  progress  records.  It  shows  how  great  is  the  incentive  when 
individual  effort  is  intelligently  recorded. 

The  temperature  record  is  obtained  by  taking  half-hourly  readings 
from  the  recording-thermometer  chart,  upon  which  a  standard- 
temperature  curve  has  been  plotted,  calling  each  reading  which  hap- 
pens to  fall  on  the  standard  line  100,  and  a  reading  20  degrees 
either  side  of  the  standard  line  o.  This  means  that  for  each  degree 
off  of  the  standard,  5  points  are  deducted  from  the  progress  record. 

The  color  record  indicates  how  near  the  men  come  to  blowing  the 
digester  when  the  color  of  the  liquor  shows  the  proper  amount  of 
li-nin  in  the  solution.  The  sample,  drawn  from  the  side  of  the 
digester,  is  compared  with  the  standard  color.  To  get  a  mathematical 
value  for  this  factor  a  range  of  colors  from  a  very  dark  to  a  very 
light  was  obtained,  the  particular  shade  which  was  taken  as  standard 
marked  100  and  one  shade  either  side  10  points  less  than  100. 

The  time  record  is  obtained  by  calling  a  certain  time  of  cooking 
100  and  taking  off  on  each  digester  cooked  one  point  for  each 
minute  above  or  below  this  standard. 

The  blowing  record  is  obtained  by  calling  30  pounds  pressure 
100  (most  of  the  cooking  being  done  at  a  pressure  of  75  pounds  per 
square  inch)  and  60  pounds  o,  the  idea  being  to  get  the  pressure  as 
low  as  possible  before  blowing  the  digester. 

It  will  be  noted  that  the  temperature  value  is  higher  than  any  of 
the  others.  This  is  because  it  is  the  most  important  element.  The 
color  record  coming  next  in  importance  is  given  the  next  highest 

By  an  arrangement  of  this  sort,  by  simply  changing  the  relative 
value  of  the  different  factors  it  is  possible  to  emphasize  any  particular 


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228       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

phase  of  the  work.  The  men  willingly  pay  the  greatest  attention 
to  the  factor  that  has  the  greatest  value,  because  it  gives  them  the 
better  record  and  because  they  know  the  reason  for  the  change. 
For  instance,  if  it  is  desired  to  emphasize  quantity,  we  give  a  larger 
value  to  the  time  record  and  a  lesser  value  to  the  temperature  record. 
Production  is  then  somewhat  increased  at  the  expense  of  quality. 

While  I  could  give  many  illustrations  similar  to  the  one  just  given 
of  our  cooking  operations,  I  will  give  only  one  final  illustration  of  how 
economy-progress  records  meet  with  equally  great  response.  In  the 
plant  where  this  system  was  developed  were  employed  over  1200 
men,  and  perhaps  half  of  these  men  had  individual  progress  records 
and  the  rest  came  under  some  sort  of  group-progress  record.  In- 
variably the  records  proved  themselves  to  be  an  incentive  to  greater 
productivity. 

COST  RECORDS  OF  WORK 

Below  is  shown  a  foreman's  detail  job  sheet  which  indicates  the 
method  we  had  for  giving  our  maintenance  foremen  cost  records  of 
their  work.  It  is  obviously  a  difficult  matter  when  dealing  with  main- 
tenance and  construction  work  to  give  quality  or  quantity  records,  as 
the  work  varies  so  much  from  day  to  day,  so  the  only  kind  of  records 
we  could  give  the  men  were  records  of  cost.  The  original  suggestion 
to  give  these  records  grew  out  of  the  fact  that  we  gave  to  each  oper- 
ating-department head  a  complete  cost  of  operating  his  department, 
for  which  he  was  held  responsible.  As  soon  as  he  began  to  realize  this 
responsibility,  because  all  the  repair  materials  were  charged  to  him, 
he  at  once  began  to  make  intelligent  criticism  of  the  engineering 
department,  and  especially  was  he  critical  of  the  maintenance  fore- 
man if  he  was  wasteful  in  the  use  of  materials.  As  a  result  of  this 
the  maintenance  foremen  asked  the  master  mechanic  if  they  could 
not  have  job  costs  showing  how  economically  they  were  doing  their 
work,  as  they  had  no  idea  of  the  value  of  materials  that  they  were 
using.  The  foreman's  detail  job  sheet  shown  is  the  result  of  this 
request.  It  will  be  noted  that  the  job  is  fully  described,  the  total 
cost  for  labor  and  material  to  date  is  given,  as  well  as  the  cost  of 
labor  and  material  for  yesterday.  Then  below  is  listed  the  itemized 
cost  of  all  materials  used.  The  men  soon  became  educated  as  to  the 
value  of  the  materials  they  were  using,  and  we  noticed  a  great 


NON FINANCIAL  INCENTIVES 


229 


In 


Fo«n  No.a 


Job, 


277/ 


foreman's  DETAIL    JOB  SHEET. 

John  Laffin     o_x.      l/lofiS 


.Foreman 


.Da+e. 


Name  of  Job  ^risfall  ZSS  Hp.  Hofors  on  Coarse  Screens 

in  West  Hill. 
Descr  i  ption  , 


Electrical  Dept.-Poivcr  Wiring. 

nn+^?rfar-t-ed    I/7//6  WorKedort 1- 


Labor  C0S++0  Da+e 

Material  Cost  +0  Da+e 
Total  Cost  to  Date  ^ 


31.  G- 


.CTays 


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Labor  "Cost  Yesterday   _ 
Material  Cost  Ye&terday 
Total  Cost  Yesterday    _ 


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change  in  the  amount  of  waste  ;  in  fact,  we  had  frequent  cases  where 
maintenance  foremen  would  bring  scales  into  the  mill  to  make  sure 
that  the  storehouse  was  giving  them  full  measure  of  materials,  and 
we  were  soon  obliged  to  get  up  a  system  of  giving  credit  for  material 
returned  to  the  storehouse,  in  order  to  help  foremen  keep  down  their 
job  costs.  This  was  in  no  sense  a  form  of  contract  system,  for  all 
of  our  maintenance  and  construction  men  were  paid  by  the  hour  and 
did  not  receive  any 
more  money  for  doing 
a  job   economically. 

Fig.  2  shows  the  con- 
crete  results   obtained 
by     giving     the     cost 
sheets   to   the  depart- 
ment   heads    and    job 
costs    to    the    mainte- 
nance foremen.  It  will 
be  noted  there  was  a 
rapid  increase  in  pro- 
duction from   1908  to 
19 13,  also  a  rise  in  re- 
pair material  used  as 
well  as  an  increase  in 
the    cost    of    mainte- 
nance labor.  The  fourth 
curve,     showing     the 
amount     of     material 
used    for    each    dollar 
spent  for  maintenance 

labor,  is  more  or  less  a  resultant  of  the  two.  The  gradual  rise 
from  1908  to  191 1  in  this  curve  was  due  to  the  increased  material- 
consuming  power  of  the  maintenance  men  because  of  the  intro- 
duction of  labor-saving  devices,  such  as  pneumatic  and  electric 
portable  tools.  There  was  a  drop  in  these  figures  in  1912  and 
19 1 3,  but  we  were  unable  to  get  a  real  thought  of  economy  started 
in  the  plant  until  the  departmental-cost  sheets  and  job-cost  sheets 
were  started.  These  were  put  into  effect  first  in  the  beginning 
of  19 1 4,  and  there  was  an  immediate  drop  in  the  curve  from  an 


DETAIL  OF  M^TERl^L    USED   YESTERDAY. 


ITEMS, 


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16-100  Amp.  Terminals, 


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Fig.  2.   Foreman's  Job  Sheet 


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230       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

average  of  about  $2.15  worth  of  material  spent  for  each  dollar  spent 
for  labor,  down  to  $1.55  in  1914  and  $1.05  in  1915. 

That  this  drop  is  due  to  the  greater  economy  and  thought  in  the 
use  of  materials  is  indicated  by  the  fact  that  our  maintenance  crew 
was  not  very  much  reduced,  the  saving  coming  almost  entirely  in 

the    use   of    materials. 


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The  drop  in  produc- 
tion in  1914-1915  was 
due  to  war  conditions 
which  were  unavoid- 
able. It  is  a  significant 
fact,  however,  that  in 
spite  of  this  drop  in 
production  the  mainte- 
nance-material cost  per 
ton  of  pulp  was  re- 
duced to  approximately 
half  the  amount  under 
the  conditions  of  higher 
production  during  the 
two  preceding  years. 

In  none  of  this  work 
did  we  pay  bonuses  to 
a  superintendent,  de- 
partment head,  or  work- 
man ;  our  salaries  and 
wages  were  high,  but 
BH  191S  payments  were  all  on 
a  m,onthly,  weekly,  or 
Fig.  3.  Showing  Concrete  Results  of  Cost  hourly  basis.  The  in- 
creased effort,  therefore, 
came  entirely  from  a  desire  within  the  individual  to  be  produc- 
tive. Of  course  this  sort  of  creative  effort  produced  great  changes 
in  operating  conditions;  we  increased  our  yearly  production  from 
42,000  tons  to  111,000  tons  without  adding  to  the  number  of 
digesters  for  cooking  the  pulp,  or  wet  machines  for  handling  the 
finished  product,  and  we  changed  our  quality  from  the  poorest  to 
the  very  best. 


t9li     1912 
Year. 


1913 


NONFINANCIAL  INCENTIVES 


231 


Due  to  the  intelligent  suggestion  which  came  from  our  men  all 
over  the  plant  we  were  able  to  make  very  radical  changes  in  the 
manufacturing  processes.  Entirely  new  methods  of  preparing  our 
wood,  making  acid,  bleaching,  etc.,  were  created,  all  of  which  were 
paid  for  out  of  the  earnings. 

I  maintain  that  this  was  all  the  result  of  the  freedom  our  men 
were  experiencing  because  they  were  working  in  an  environment 
which  stimulated  thinking.  They  had  ample  opportunity  con- 
stantly to  increase  their  knowledge  of  the  underlying  natural  laws  of 
the  process  and  were  therefore  able  to  realize  the  joy  which  comes 
from  a  conscious  mastery  of  their  part  of  the  process. 

This  freedom  to  express  one's  individuality  in  constructive 
work  according  to  law  is  the  only  real  freedom,  for  freedom  unre- 
strained by  a  consciousness  of  the  universality  of  natural  law  leads 

to  anarchy. 

We  should  never  lose  sight  of  the  fact  that  the  degree  of  con- 
scious self-expression  which  the  workman  can  attain  is  in  direct 
proportion  to  the  ability  of  the  organization  to  measure,  for  his  bene- 
fit, the  impress  of  his  personality  upon  it.  The  most  democratic 
industrial  plant,  therefore,  is  the  one  which  permits  the  fullest  possi- 
ble amount  of  individual  freedom  to  each  member  irrespective  of  his 
position,  and  at  the  same  time  is  so  sensitively  adjusted  that  it  reflects 
immediately  the  effects  of  his  actions.  If  his  actions  result  in  injury 
to  others,  he  will  see  that  as  a  part  of  the  whole  he  himself  must  also 

suffer. 

I  have  made  no  attempt  in  this  paper  to  touch  upon  our  method 
of  arriving  at  the  proper  financial  compensation,  as  this  is  beyond 
the  scope  of  the  subject  assigned  to  me.  I  feel  that  I  should  state, 
however,  that  in  our  mills  in  Canada,  where  the  same  scientific  re- 
cording of  operations  is  being  developed,  our  wage  rates  are  adjusted 
each  spring  after  careful  discussion  with  the  representatives  of  our 
local  labor  organizations.  This  has  proved  to  be  a  very  just  and 
satisfactory  method,  for  the  rates  thus  determined  are  really  a  con- 
sensus of  opinion  of  both  employer  and  employee,  and  once  the  wage 
question  is  disposed  of,  all  are  free  to  devote  their  energies  to  the 
intelligent  solution  of  manufacturing  problems.  Constant  agitation 
of  the  question  of  financial  remuneration  only  detracts  from  the  work, 
and  our  experience  has  invariably  been  that  there  will  be  plenty  of 


-■S,t 

III 


232       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

incentive  to  productive  effort  if  the  working  environment  is  such  that 
the  workman  can  express  himself  as  an  intelligent  human  being. 

Man  is  not  an  animal,  but  a  free,  self-determining  mental  center 
of  consciousness,  whose  reason  for  existence  is  that  the  universal  life 
may  be  able  to  deal  with  a  particular  situation  in  time  and  space  and, 
by  this  means,  be  enabled  to  evolve  a  material  universe  organized  to 
express  the  one  great  individual  life  of  which  we  are  all  a  part. 

In  conclusion  let  me  say  that  I  am  well  aware  that  to  some  of  you 
this  may  seem  like  pure  philosophical  speculation,  far  removed  from 
the  practical  affairs  of  everyday  life.  I  have  said  nothing,  however, 
that  I  cannot  back  up  by  any  number  of  additional  illustrations^ 
and  my  hope  is  that  the  examples  given  will  stimulate  others  to 
make  similar  investigations,  so  that  we  can  fulfill  our  mission  in  this 
country  by  evolving  an  industrial  philosophy  which  will  have  for  its 
ultimate  aim  the  continuous  unfoldment  of  the  latent  powers  in  man. 


New  York 


Robert  B.  Wolf 


XVIII 
APPRENTICESHIP   IN  THE  METAL   TRADES^ 

THREE  problems  of  fundamental  importance  enter  into  indus- 
trial production :  the  material  problem,  the  machine  problem, 

the  man  problem. 

The  last  might  be  called  the  main  problem,  for  it  is  the  most  im- 
portant of  the  three.  It  is  also  the  most  difficult  to  deal  with,  and 
the  most  neglected ;  perhaps  it  is  the  most  neglected  because  it  is 
the  most  difficult.  Yet  on  its  proper  solution  hinges  largely  the 
success  of  an  industrial  enterprise  and  its  capacity  to  maintain  itself 
in  competition  with  enterprises  of  similar  character. 

All  manufacturers  can  buy  materials  of  approximately  the  same 
kind  and  grade  at  about  the  same  price ;  they  can  also  purchase 
or,  if  need  be,  design  and  make,  or  have  made,  machines  of  like 
productive  capacity  and  cost  as  compared  with  those  used  by  their 
competitors.  Moreover,  they  can  study  the  successful  manufacturing 
methods  of  another  concern  and  adopt  them  in  full  or  in  part  and 
improve  upon  them.  Yet  when  it  comes  to  securing  and  maintain- 
ing the  personnel  and  effectiveness  of  an  industrial  organization, 
only  intelligent  effort  through  many  years  will  enable  one  manu- 
facturer to  attain  advantages  in  this  respect  which  another  may 
possess  by  virtue  of  the  efficiency  of  his  human  organization. 

Efforts  to  teach  the  young  man^  whether  young  in  age  or  experience, 
the  knowledge  or  skill  already  acquired  by  his  older  brother  are  as 
old  as  mankind.  With  the  social  and  economic  changes  which  de- 
veloped during  the  centuries,  the  character  of  the  problem  varied, 
changing  at  first  from  the  need  of  a  purely  vocational  to  that  of  a 
more  pronounced  scholastic   training. 

During  the  last  century,  however,  the  vocational  aspect  again 
forged  prominently  to  the  front,  especially  in  countries  such  as  the 

iFrom  an  address  substantially  as  delivered  before  the  Association  of  Iron 
and  Steel  Electrical  Engineers,  June,  1916.    Revised  by  the  author,  1920. 

233 


in 


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234       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

United  States,  in  which  industrial  activities  rapidly  began  to  pre- 
dominate.   The  system  of  education  had  perforce  to  accommodate  it- 
self to  the  new  requirements.   Thus  the  teaching  of  the  mechanical  arts 
developed  on  a  large  scale,  and  a  marked  impetus  was  given  it  in  the 
United  States  by  the  industrial  reconstruction  period  following  the 
Civil  War.    As  new  industrial  enterprises  were  started,  and  as  older 
ones  developed  in  size,  their  owners  made  it  their  concern  to  teach 
young  men  the  practical  work  in  which  they  themselves  were  engaged. 
Soon,  under  the  influence  of  American  genius,  industry  expanded 
at  such  a  rapid  pace  that  it  became  necessary  to  specialize  in  in- 
dustrial processes  to  a  larger  degree  than  ever  before.    Somewhat 
misled  by  the  immediate  results  of  specialization,  which  permitted  the 
effective  employment  of  many  semiskilled  and  even  unskilled  work- 
men,  employers   came   to   believe   that  the  need   for  well-trained 
all-round  skilled  mechanics  was  now  less  important,  and  they  dis- 
continued to  a  large  extent  their  efforts  for  systematic  trade  training. 
But  these  employers  failed  to  consider  that  the  greater  specializa- 
tion of  industry  on  the  basis  of  wholesale  production,  and  utilization 
of  multitudes  of  workers,  required  a  large  number  of  highly  trained 
men  to  lead  and  direct  this  ever-growing  industrial  army.    They  did 
not  realize  that  the  more  complex  machinery,  through  which  speciali- 
zation was  largely  made  possible,  also  called  for  a  higher  type  of  all- 
round  mechanics  to  design,  construct,  and  install  this  machinery. 
About  that  time,  also,  manual  training  was  being  introduced  into  the 
public-school  system,  and  employers  readily  shirked  their  responsi- 
bility for  the  training  of  craftsmen  by  shifting  it  to  the  public  school, 
without,  however,  any  assurance  that  the  schools  would  be  able  to 
develop   quickly   and   effectively    the   required    type    of   industrial 
workers. 

American  employers  soon  became  disillusioned.  The  exhibition 
in  Chicago  in  1893  displayed  the  products  of  the  mechanical  skill  of 
foreign  nations  so  impressively  as  to  awaken  American  employers  to 
the  necessities  of  the  situation.  Once  more  they  realized  that  final 
responsibility  for  training  skilled  workers  must  rest  upon  them,  even 
though  they  might,  as  they  should,  take  justified  advantage  of  the  val- 
uable help  which  public  schools  could  render.  The  thought  was 
born  anew  among  employers  that  only  through  the  revival  of  the 
apprenticeship  system,  modified  to  suit  new  industrial  conditions 


APPRENTICESHIP  IN  THE  METAL  TRADES        235 

could  the  superior  intelligent  skill  be  secured  by  means  of  which 
they  could  fortify  themselves  against  foreign  competition. 

A  number  of  examples  of  effective  trade  training  in  industry  can 
be  cited ;  these,  however,  are  only  as  a  drop  in  the  bucket  when  it 
is  remembered  that  there  are  about  300,000  manufacturing  estab- 
lishments in  the  United  States,  each  with  its  need  of  skilled  and  semi- 
skilled workers. 

Most  employers  are  giving  but  little  heed  to  this  pressing  need. 
The  average  employer,  not  from  necessity  but  because  of  thought- 
lessness or  habit,  still  prefers  to  get  workmen  whom  someone  else  has 
trained.  But  if  he  can  be  convinced  by  concrete  examples  that  he 
can  readily  train  his  own  skilled  workers  to  meet  the  special  re- 
quirements of  his  business,  he  will  quickly  sense  his  responsibility 
and,  with  the  usual  enterprise  and  acumen  of  the  American  business 
man,  apply  himself  seriously  to  the  task. 

It  was  in  1902  that  the  General  Electric  Company,  employing  at 
that  time  about  4000  men,  established  at  its  works  at  West  Lynn, 
Massachusetts,  a  new  apprenticeship  system.  This  step  was  the 
outcome  of  a  study  of  the  reasons  for  the  seeming  failures  of  the 
then-existing  apprenticeship  systems.  Briefly  enumerated,  these  were 

as  follows : 

Under  the  old  form  of  apprenticeship  a  boy  was  taken  into  a 
shop  and  turned  over  to  a  foreman,  who  was  expected  to  teach  him 
the  trade.    The  foreman,  himself  very  busy  in  his  regular  duties  and 
usually  more  adapted  by  experience  and  inclination  to  the  production 
of  manufactured  materials  than  to  the  training  of  boys,  would  turn 
the  boy  over  to  an  assistant  foreman,  who  in  turn  would  pass  him 
down  the  line  until  he  landed  under  the  supervision  of  a  mechanic, 
skilled  01-  partly  skilled  as  the  case  might  be,  but  not  often  able  to 
impart  his  skill  to  the  boy.    Frequently,  also,  the  run  of  work  in  a 
shop  was  not  sufficiently  varied  to  give  to  the  boy  broad  experience 
of  instructive  character.    Even  though  the  boy's  superior  might  pos- 
sess the  ability  to  impart  to  him  his  knowledge,  and  might  also  be 
able  to  give  him  such  a  varied  assortment  of  work  as  to  afford  a  broad 
opportunity  to  learn  the  trade,  the  apprentice  was  himself  seriously 
handicapped  by  his  own  limited  education.    Employed  at  work  that 
required  the  use  of  drawings,  he  could  usually  neither  understand 
them  nor  could  he  make  a  simple  mechanical  sketch.    If  a  mechanical 


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236       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

operation  required  the  use  of  mathematical  formulse  that  were  not 
included  in  his  limited  school  experience,  the  apprentice  would  have 
to  forego  doing  the  higher  grade  of  work  that  such  knowledge  would 
have  brought  within  his  range.    The  apprentice  became,  therefore, 
the  victim  of  the  daily  or  weekly  requirements  of  the  shop. 
^  To  overcome  these  difficulties,  apprentices  were  placed  under  spe- 
cial supervisors,  whose  function  it  was  to  transfer  the  apprentices 
from  one  department  to  another  in  order  to  give  them  an  equal 
chance  and  a  broad  opportunity  for  training.    To  the  extent  to  which 
the  supervisor  of  apprentices  could  harmonize  the  point  of  view  of 
the  employer  with  that  of  the  apprentice,  he  would  fulfill  his  dual 
function  with  satisfaction ;  but  the  practial  conditions  in  the  various 
departments  often  prevented  the  supervisor  from  doing  full  justice 
to  his  task. 

In  the  industrial  struggle  of  today,  quite  different  from  that  of 
twenty-five  or  fifty  years  ago,  it  is  more  and  more  essential  for  those 
who  wish  to  rise  above  the  average  employee  not  only  to  be  able 
to  do  their  work  well  but  also  to  possess  an  intelligent  understanding 
of  the  work  in  which  they  are  engaged  and  an  imaginative  outlook 
as  to  the  possibilities  for  better  and  more  efficient  work.  Many  em- 
ployers fully  sensed  this  situation  and  induced  their  apprentices  to 
take  evening  courses  at  public  schools  and  in  other  educational  in- 
stitutions, but  with  only  meager  success,  largely  because  the  day's 
work  was  in  itself  as  much  of  a  task  as  the  apprentice  cared  to  under- 
take and  partly  because  the  boy  was  really  too  tired  at  the  end  of 
the  day  to  do  good  school  work  at  night. 

Realizing,  then,  that  these  factors  were  largely  responsible  for 
the  failure  of  apprenticeship  systems,  the  General  Electric  Company 
established  in  the  Lynn  Works  special  departments  devoted  exclu- 
sively to  the  training  of  apprentices,  placed  under  the  supervision 
of  highly  skilled  men  endowed  by  nature  and  by  training  with 
the  faculty  for  teaching  others.  There  are  to  be  found  within  the 
big  machine  shops  a  small  machine  shop,  and  within  the  big  wood- 
working shops  a  small  patternmaking  shop,  set  aside  for  training 
of  boys  under  supervision  of  men  well  qualified  for  developing  the 
boys'  aptitude  for  such  mechanical  work.  Readily  accessible  class- 
rooms were  constructed,  in  which  every  apprentice  is  required  to 
devote,  but  on  full  pay,  a  part  of  his  working  hours  to  classroom 


APPRENTICESHIP  IN  THE  METAL  TRADES        237 

study  and  where,  under  competent  instructors,  he  is  taught  those 
branches  of  technical  knowledge  that  will  assist  him  in  attaining  the 
goal  of  his  mechanical  or  engineering  ambition.  At  the  same  time 
an  effort  is  made  to  develop  in  the  apprentice  an  objective  as  well 
as  a  subjective  point  of  view  of  the  relationship  between  employer 
and  employee,  in  order  to  impart  to  the  growing  worker  greater 
loyalty  to  his  work  and  to  the  man  in  charge  of  it. 

Apprentices  in  the  training  room  are  required  to  perform  work 
of  commercial  character,  which  would  have  to  be  done  by  others  in 
the  factory  if  it  were  not  done  by  these  apprentices  ;  in  this  way  it 
is  aimed  to  train  apprentices  'Mn  industry  for  industry." 

The  idea  of  maintaining  special  training  rooms  in  factories  was 
new.  The  value  of  training  apprentices  on  commercial  work,  care- 
fully selected  for  its  instructive  character,  lies  in  the  fact  that  the 
elements  of  time,  money  value,  and  usefulness  immediately  impress 
themselves  upon  the  mind  of  the  apprentice,  acting  as  a  stimulus 
and  incentive  to  him  to  put  forth  his  best  efforts. 

The  other  new  idea  was  the  introduction  of  classroom  instruction 
into  the  factory.  The  Company  insists  that  every  apprentice  receive 
mental  as  well  as  manual  training,  in  order  that  skillful,  intelligent, 
and  loyal  artisans,  and  not  human  automatons,  will  be  developed. 
Realizing  that  an  apprentice  is  entitled  to  play  and  to  rest  in  the 
evening  after  a  day's  work,  and  that  he  would  unwillingly  go  to  the 
classroom  if  it  meant  a  partial  loss  of  his  wages  or  a  restriction  of  his 
time  for  recreation,  the  Company  inaugurated  the  plan  of  giving 
the  classroom  instruction  during  the  working-day  and  without  loss 
of  wage  to  the  apprentice. 

The  underlying  reason  for  this  procedure  is  based  on  the  con- 
viction that  most  boys  leave  school  as  early  as  permitted  and  go 
to  work,  partly  because  school  has  become  to  them  a  drudgery  and 
partly  because  they  want  to  earn  money.  The  apprentice-school 
studies  are  therefore  made  so  interesting  and  are  so  correlated  to  the 
practical  work  as  to  attract  the  apprentice,  and  his  wages  are  paid 
whether  he  is  working  in  the  training  room  or  studying  in  the  class- 
room. Otherwise  most  apprentices  would  go  into  the  classroom  not 
because  they  like  it  but  because  they  must,  and  consequently  they 
would  not  get  the  full  benefit  from  the  Company's  educational  effort ; 
they  would  have  eyes  but  see  not  and  ears  but  hear  not. 


■M 


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23S       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

At  first  sight  the  comparatively  large  expenditure  for  salaries  of 
classroom  instructors  and  for  wages  paid  to  apprentices  for  non- 
productive  time  spent  in  classrooms  would  seem  unjustified  Ex- 
perience, however,  has  shown  otherwise,  for  the  added  intelligence 
acquired  in  the  classrooms  makes  the  apprentice  do  more  and  better 
work  in  the  shop. 

In  respect  to  entrance  requirements,  any  boy  sixteen  years  of  age 
or  over,  normally  developed,  with  a  pronounced  desire  for  the  trade 
which  he  wishes  to  learn  and  with  a  successfully  completed  grammar- 
school  course,  is  eligible  for  admission  as  an  apprentice.  In  a  few 
instances  boys  are  accepted  who  have  not  fully  completed  the 
grammar-school  course  but  can  give  adequate  reason  for  their  incom- 
plete education. 

We  know  that  many  a  boy  who  has  gone  only  through  the  seventh 
or  eighth  grade  of  the  grammar  school,  but  for  one  reason  or  another 
did  not  or  could  not  graduate,  will  develop  into  a  far  better  mechanic 
than  others  who  have  completed  a  prescribed  school  course  and  have 
received  a  certificate  of  graduation.    Yet,  in  dealing  with  large  num- 
bers of  apprentices  it  becomes  necessary  to  deal  with  them  in  a  fairly 
uniform  manner.    By  insisting,  therefore,  on  a  completed  grammar- 
school  education  as  an  entrance  requirement,  it  is  safe  to  start  the 
educational  program  on  the  basis  of  such  educational  preparation  by 
all  apprentices.    Moreover,  we  are  thus  assisting  the  public-school 
authorities  in  holding  the  boys  to  the  end  of  the  school  course   so 
that  they  may  learn  there,  as  they  can  better  learn  in  the  public 
schools  than  in  the  manufacturing  establishment,  the  fundamentals 
of  education  and  the  duties  of  citizenship  and  may  obtain,  at  least  to 
a  small  degree,  that  general  cultural  background  which  adds  so  much 
m  later  life  to  the  enjoyment  of  life  itself.    Aside  from  the  selfish  aim 
therefore,  of  obtaining  a  better  educated  class  of  boys,  such  method 
sigmfies  an  effort  for  cooperation  with  the  public-school  authorities 
on  whose  cooperation,  in  turn,  we  have  to  rely  in  the  successful 
carrying  out  of  our  own  educational  work 

n.n'lll'T"'^''\''u  "T"""^  ''  '''^'  "  '"^^  P^"^d  «f  ^bout  two 

months,  during  which  they  are  closely  observed  to  ascertain  whether 
they  possess  the  natural  ability  for  the  chosen  work  and  have  the 
moral  stamina  and  general  intelligence  required  to  successfully  com- 
plete the  course.   Only  those  vvho  give  satisfactory  promise  during 


APPRENTICESHIP  IN  THE  METAL  TRADES        239 

the  trial  period  are  allowed  to  sign,  in  conjunction  with  their  father 
or  guardian,  a  standard  agreement  which  outlines  the  conditions 
of  apprenticeship.  The  apprentice  is  distinctly  told  that  the  agree- 
ment has  no  legal  force  and  may  be  broken  by  him  without  fear  of 
prosecution.  He  is  made  to  understand,  however,  that  the  agreement 
is  in  the  nature  of  a  promise  made  by  one  gentleman  to  another :  the 
Company,  on  the  one  hand,  promising  to  teach  the  trade  and  to  pay 
stipulated  wages ;  the  apprentice,  on  the  other  hand,  promising  to 
give  satisfaction  in  his  work  and  in  his  deportment. 

Experience  has  shown  that  boys  employed  on  this  basis  are 
more  apt  to  live  up  to  the  agreement  than  if  they  were  working  under 
the  impression  that  it  is  being  used  as  a  club  to  force  them  to  con- 
tinue at  work.  The  percentage  of  apprentices  who  "jump"  the 
course  after  signing  the  agreement  is  remarkably  low ;  the  average  is 
considerably  less  than  5  per  cent. 

As  for  apprentice  wages,  the  company  decided  to  pay  remuner- 
ation from  the  immediate  beginning  of  the  course,  even  during  the 
trial  period,  and  to  pay  sufficient  wages  to  allow  boys  from  poor 
families  to  enter  the  apprenticeship  department  on  a  self-supporting 
basis.  Gradually  the  wage  schedule  increased  with  the  general  in- 
crease of  wages  in  industry,  until  now  apprentices  receive  at  least 
S5.50  per  week  at  the  start  (increased  in  1919  to  $8.64),  with 
periodical  increases  at  the  rate  of  from  $1  to  $1.50  per  week  for 
each  succeeding  year  of  apprentice  training.  A  cash  bonus  of  $100 
is  paid  at  the  successful  termination  of  the  prescribed  training 
period,  when  the  apprentice  is  also  awarded  a  Certificate  of  Appren- 
ticeship, which  entitles  him  to  recognition  as  a  full-fledged  journey- 
man and  outlines  the  course  of  training  which  he  has  successfully 

pursued. 

The  apprenticeship  period  for  grammar-school  graduates  is  four 
years,  except  in  the  case  of  molder  apprentices,  who  may  finish  their 
course  within  three  years.  Iron  and  steel  molder  apprentices,  however, 
must  be  at  least  eighteen  years  of  age  to  undertake  this  somewhat 
more  arduous  work  and  are  in  consequence  paid  somewhat  higher 
wages.  The  apprenticeship  period  for  high-school  graduates  is  three 
years,  and  these  apprentices  receive  wages  beginning  with  $6.50  per 
week  (increased  in  1919  to  $10)  and  increasing  to  Sn  per  week 
(increased  in  1919  to  $15.84). 


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240       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

As  far  as  business  conditions  permit,  graduate  apprentices  are  en- 
couraged to  remain  in  the  service  of  the  General  Electric  Company. 
There  is  no  fixed  standard  of  wages  for  graduate  apprentices  ;  each 
case  is  settled  on  its  own  merits.  The  average  rate,  however,  is  from 
$3  to  S3. 50  per  day  (increased  in  1919  to  $5.60  per  day  at  the  start), 
with  splendid  prospects  for  advancement  either  in  the  service  of  the 
Company  or  in  that  of  other  industrial  establishments. 

Contrary  to  general  practice,  the  recruit  in  the  apprentice  depart- 
ment is  not  required  to  do  ordinary  chores,  such  as  sweeping  floors 
or  running  errands,  but  is  immediately  put  at  a  machine  or  at  a  bench 
to  perform  simple  mechanical  operations  which  are  strictly  a  part 
of  the  trade  that  he  desires  to  learn.  The  apprentice  in  training 
might,  for  example,  sweep  the  floors  ever  so  clean  and  carry  messages 
ever  so  quickly  and  yet  be  naturally  unfit  for  the  trade.  It  is  there- 
fore essential  to  find  out  as  quickly  as  possible  whether  the  boy  who 
wants  to  become  a  machinist  has  an  embryo  machinist  in  his  makeup  ; 
if  there  is  no  future  machinist  in  him,  it  is  of  course  futile  to  attempt 
to  draw  one  out  of  him.  The  sooner  this  is  definitely  determined, 
the  better  for  the  boy  and  for  the  Company ;  otherwise,  both  would 
waste  valuable  time,  and  the  boy's  progress  would  be  retarded  and 
his  reputation  injured  if  he  should  later  be  discharged  for  lack  of 
natural  ability.  The  stricter  the  process  of  weeding  out  during  the 
trial  period,  the  easier  the  subsequent  task  of  training  and  retaining 
apprentices. 

From  a  modest  beginning  in  1902,  with  one  training  room  about 
thirty  by  forty  feet  in  size  and  located  in  an  available  corner  of 
an  old  factory  building,  the  apprentice  system  has  grown  step  by 
step  and  in  keeping  with  the  development  of  the  Lynn  Works,  which 
now  employ  about  13,000  persons.  Apprentice  training  rooms  for 
machinists,  toolmakers,  and  diemakers,  for  patternmakers  and  for 
foundry  workers,  are  now  located  in  Lynn. 

The  training  room  for  patternmakers  occupies  a  space  of  about 
16,000  square  feet,  with  an  adequate  equipment  of  woodworking 
machinery.  The  training  room  for  machinists,  toolmakers,  and  die- 
makers,  located  on  the  top  floor  of  a  modern  factory  building,  covers 
a  space  80  feet  wide  and  460  feet  long,  or  an  area  of  36,800  square 
feet ;  in  it  is  a  very  complete  equipment  of  the  machines  usually 
needed  for  the  mechanic,  and   representing  now  an  approximate 


APPRENTICESHIP  IN  THE  METAL  TRADES        241 

investment  of  $250,000.  All  rooms  are  well  lighted  and  ventilated 
and  are  kept  as  clean  as  factory  work  will  permit.  The  influence 
of  the  clean  and  orderly  shop  develops  in  the  apprentice  the  tendency 
to  personal  neatness  and  cleanliness  as  well  as  orderly  habits  about 

his  machine  or  bench. 

All  machines  are  of  modern  type ;  all  are  motor-driven  and  prop- 
erly safeguarded.  Similar  conditions  prevail  in  the  training  room 
for  patternmaker  apprentices  and,  indeed,  in  all  of  the  apprentice 

training  rooms. 

In  each  apprentice  department  a  wide  variety  of  work  is  done 
and  a  broad  range  of  machines  is  provided  with  which  to  do  it ;  this 
excites  the  boy's  interest  and  gives  him  an  extensive  and  valuable 
practical  experience.  There  is  no  hard  and  fast  rule  to  govern  the 
time  during  which  an  apprentice  shall  be  trained  on  one  kind  of 
machine  or  on  one  class  of  work ;  this  depends  on  the  ability  which 
he  shows  and,  to  some  extent,  is  controlled  by  the  character  and  vol- 
ume of  productive  work  which  the  department  can  secure.  Generally, 
however,  satisfaction  is  attained  when  an  apprentice  can  do  the  re- 
quired work  with  absolute  commercial  accuracy  and  a  fair  degree  of 

speed. 

In  regard  to  accuracy  of  work,  it  is  only  fair  to  demand  of  the 
apprentice  the  same  exactness  as  engineering  and  commercial  re- 
quirements demand  of  the  regular  workers.  If,  from  an  engineering 
standpoint  and  from  that  of  economical  manufacture,  two  holes 
theoretically  two  inches  apart  from  center  to  center  can  vary  in  their 
location  by  one  thirty-second  of  an  inch  one  way  or  the  other  without 
interfering  with  engineering  efficiency,  then  any  relative  location  of 
the  two  holes  within  two  inches  plus  one  thirty-second  of  an  inch 
and  two  inches  minus  one  thirty-second  of  an  inch  will  be  satisfactory 

commercial  accuracy. 

When  an  apprentice  has  learned  to  perform  a  particular  operation 
quickly  and  accurately,  he  is  often  required  to  help  in  the  training 
of  another  apprentice  who  has  not  yet  advanced  as  far  as  he.  He  is 
made  a  leader  in  what  is  called  a  "team";  that  is,  he  becomes  a 
boy  teacher  of  a  boy  pupil.  The  system  disregards  the  age  and 
service  period  of  an  apprentice ;  the  more  capable  teaches  the  less 
capable,  even  though  the  latter  is  older.  The  boys  are  thus  taught 
to  respect  the  skill  of  those  who  have  gained  greater  proficiency. 


M^  ^- 


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Nlliiii 


242       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

When  the  boy  teacher  has  taught  the  boy  pupil  to  understand  the 
work  and  to  do  it  accurately,  the  boy  teacher  is  promoted  to  a 
different  class  of  work,  most  likely  in  the  capacity  of  a  boy  pupil  to 
a  yet  more  proficient  apprentice. 

By  this  team  practice  the  supervisory  capacity  of  six  skilled  adult 
instructors  is  expanded  to  meet  the  needs  of  some  two  hundred 
apprentices  grouped  in  one  training  room.  In  many  respects  better 
results  are  thus  obtained  than  if  the  instructors  personally  supervised 
each  apprentice,  for  the  boy  teacher  comes  into  closer  relationship 
with  his  pupil.  At  the  same  time  the  executive  ability  of  the  boy 
teacher  is  developed,  and  the  importance  of  accurate  workmanship  is 
indelibly  impressed  upon  him  as  he  strives  to  impress  it  on  another. 
This  method  trains  for  future  foremanship  those  apprentices  who 
have  native  though  undeveloped  ability  for  handling  men  and  super- 
vising their  work.  Moreover,  by  this  arrangement  it  is  readily  dem- 
onstrated how  much  ability  and  willingness  to  learn  an  apprentice 
possesses,  for  the  boy  teacher  whose  advancement  is  retarded  by  a 
slow  pupil  is  quick  to  complain  of  his  pupil's  failure  to  grasp  mechan- 
ical details  or  of  his  lack  of  interest  in  the  work.  If  the  complaint 
seems  justified  and  is  not  due  to  the  boy  teacher's  fault,  the  regular 
instructor  endeavors  by  personal  attention  to  stimulate  the  apprentice 
pupil.  Sometimes  he  succeeds,  but  more  often  he  confirms  the  boy 
teacher's  judgment  and  is  obliged  to  discharge  the  apprentice  com- 
plained of. 

An  important  part  of  the  work  in  electrical  manufacture  has  to 
do  with  the  winding  of  coils,  fields,  armatures,  and  similar  parts. 
Skilled  winders  are  not  plentiful ;  rapid  expansion  in  the  use  of 
electrical  power  in  industry  and  in  public-service  work  is  creating 
a  greater  demand  for  them.  With  this  thought  in  mind  the  General 
Electric  Company  endeavors  to  train  some  apprentices  in  this 
particular  line  of  work.  Usually  boys  with  a  high-school  educa- 
tion are  employed  to  learn  to  wind  armatures  and  fields  and 
to  test  them  for  commercial  use;  they  also  strip  and  rewind 
defective  fields  and  armatures,  a  particularly  instructive  practice  for 
apprentices. 

The  time  spent  by  apprentices  in  their  respective  training  rooms 
amounts  to  about  half  the  total  period  of  apprenticeship,  and  varies 
somewhat  with  the  capacity  of  the  apprentice  and  with  productive 


APPRENTICESHIP  IN  THE  METAL  TRADES        243 

conditions  throughout  the  factory.  Apprentices  who  have  made 
good  progress  in  the  apprentice  training  room  are  often  lent  to 
foremen  in  factory  departments,  provided  the  work  proposed  offers 
educational  value  that  fits  into  the  schedule  of  the  apprentice  course. 
Generally,  however,  the  entire  last  half  of  the  apprentice  course  is 
spent  in  factory  departments,  where  the  apprentices  gain  enlarged 
experience  and  come  in  contact  with  many  skilled  workers.  Yet  the 
apprentice  always  remains  under  control  of  the  apprentice  superin- 
tendent and  continues  the  prescribed  daily  classroom  studies.  If 
an  apprentice  loafs  or  lowers  his  usual  standard  of  work  or  deport- 
ment after  he  has  been  transferred  from  the  apprentice  depart- 
ment, he  is  usually  brought  back  to  the  training  room  to  serve  a 
discipline  period  before  he*  is  allowed  to  return  to  the  factory 
department.    One  dose  of  this  discipline  usually  cures. 

Previous  to  the  establishment  of  training  rooms  for  apprentices 
foremen  did  not  favor  taking  apprentices,  because  they  were  a  care 
—white  elephants,  so  to  speak  ;  they  now  prefer  partly  trained  ap- 
prentices to  many  of  the  men  from  outside  who  claim  to  be  full- 
fledged  mechanics. 

The  apprentice  training  rooms  are  beehives  of  activity  and  models 
of  clean  and  orderly  workshops,  equipped  with  various  makes  and 
styles  of  standard  machine  tools  and  appliances  required  for 
practical  training  and  economical  production.  It  should  again  be 
emphasized  that  all  work  done  in  these  departments  has  a  commercial 
value  either  for  production,  equipment,  or  repair  purposes.  Nothing 
is  done  merely  for  the  sake  of  following  pedagogical  precepts  or  to 
make  a  fine  exhibition  of  work.  It  is  the  eminently  practical  char- 
acter of  the  training  system  which  has  its  most  wholesome  influence 
upon  apprentices  and  appeals  strongly  to  them. 

The  same  practical  policy  applies  to  all  classroom  work.  The 
courses  of  study  are  carefully  planned,  first  to  conform  to  the  ap- 
prentices' mental  capacity,  as  denoted  by  previous  school  education, 
and  second  to  teach  those  sciences  that  definitely  dovetail  into  the 
operations  to  be  performed  in  the  chosen  field  of  work.  Grammar- 
school  graduates  start  at  the  lowest  rung  of  the  ladder,  while  high- 
school  graduates  receive  more  advanced  instruction,  particularly  in 
mathematics,  mechanics,  mechanisms,  thermodynamics,  magnetism, 
and  electricity. 


I 


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244       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Every  apprentice  is  required  to  pursue  classroom  studies  for  an 
hour  and  a  half  every  day  except  during  July  and  August ;  during 
these  months  the  classrooms  are  closed  in  order  to  give  apprentices 
and  instructors  an  opportunity  to  take  a  short  vacation.  The  prac- 
tical work  in  the  training  rooms,  shop  departments,  and  drawing 
and  testing  rooms,  however,  continues  without  interruption  through- 
out the  year.  For  the  convenience  of  the  various  training  rooms  and 
shop  departments,  classroom  attendance  is  distributed  over  the  day, 
some  apprentices  starting  ^t  the  beginning  and  some  toward  the  end 
of  the  forenoon,  others  at  the  beginning  and  the  balance  toward  the 
end  of  the  afternoon.  In  order  to  segregate  at  frequent  intervals 
the  more  capable  from  the  less  capable  apprentices  as  far  as  the 
school  work  is  concerned,  the  school  year  is  divided  into  three 
periods ;  advancement  from  one  class  to  the  other  is  dependent  on 
satisfactory  daily  performance  as  well  as  on  the  results  shown  at 
periodical  examinations. 

The  endeavor  is  to  make  the  instruction  concretely  applicable  to 
the  practical  work  which  the  apprentices  perform.  Whenever  possi- 
ble the  instructors  speak  in  terms  of  materials  and  machinery, 
facilitating  the  understanding  of  the  apprentice  by  exhibiting  the 
objects  to  which  they  refer.  The  opportunities  for  doing  this  are, 
of  course,  excellent  in  the  large  establishment  located  at  West  Lynn, 
with  its  great  variety  of  manufactures.  High  percentage  record  of 
an  apprentice  is  a  secondary  object,  although  from  an  organization 
standpoint  it  may  be  a  necessary  one;  to  make  the  apprentice 
understand,  to  make  him  think,  and  so  to  give  him  an  industrial 
understanding,  and  to  impart  to  him  pertinent  information  and 
develop  in  him  a  general  intelligence  as  well,  is  the  paramount  aim 
of  the  instruction. 

Apprentices  who  have  had  a  grammar-school  education  only  and 
are  trying  to  fit  themselves  for  skillful  molders,  machinists,  pattern- 
makers, instrument-makers,  steam  fitters,  and  the  like  are  first 
taught  the  mathematical  sciences  as  they  relate  to  arithmetic  and 
algebra,  mensuration  and  plane  geometry,  and  are  also  given  an  in- 
troduction into  trigonometry.  Abstract  teaching  is  avoided  as  far 
as  possible.  As  an  example,  the  instructor  does  not  call  merely  on 
a  boy's  memory  by  asking  him  to  tell  how  much  four  times  three 
times   six   is,   but   rather   puts   the   same   problem   to   him    in   its 


APPRENTICESHIP  IN  THE  METAL  TRADES        245 

application  to  industrial  conditions  by  asking  him  how  much  electri- 
cal energy,  expressed  in  certain  units,  is  required  to  light  a  factory 
consisting  of  three  workrooms,  in  each  of  which  there  are  four  arc 
lamps,  each  requiring  six  amperes,  or  units,  of  electricity  for  proper 
operation.  In  stating  the  problem  in  this  way  the  apprentices  are 
briefly  told  what  an  arc  lamp  is,  are  shown  such  a  lamp  and  have  its 
operation  explained  to  them.  They  are  also  told  briefly  the  meaning 
of  an  ampere  as  a  unit  of  electrical  measurement. 

In  the  teaching  of  mensuration  much  emphasis  is  laid  on  the 
figuring  out  of  surface  space  of  floors,  roofs,  and  walls,  and  of  the 
weights  of  machine  elements  and  materials.  The  teaching  of  trigo- 
nometry proceeds  along  similar  lines,  but,  while  all  other  appren- 
tices are  required  to  learn  trigonometric  functions  and  the  solution 
of  trigonometric  problems,  molder  apprentices,  on  account  of  the 
shortness  of  their  apprentice  period  and  because  their  work  would 
ordinarily  not  require  such  knowledge^  are  excused  from  this  particu- 
lar study  ;  some,  however,  take  it  at  their  own  request. 

The  teaching  of  mathematics  and  especially  of  mensuration  en- 
ables apprentices  to  become  acquainted  with  the  very  practical  prob- 
lems which  they  will  meet  later  on  as  skilled  mechanics,  as  foremen, 
superintendents,  and  engineers. 

Another  branch  of  the  classroom  work  concerns  itself  with  in- 
struction in  the  elements  of  mechanics ;  the  essentials  of  power  trans- 
mission as  it  relates  to  pulleys,  belts  and  chains,  and  to  gearing ; 
the  mechanics  and  strength  of  materials,  a  knowledge  of  which  will 
develop  a  better  understanding  of  the  characteristics  and  uses  of 
materials  of  construction  and  how  to  calculate  the  required  strength 
of  a  machine  part  under  given  conditions  of  load ;  and,  in  a  brief 
outline,  the  prime  movers  as  they  utilize  air,  water,  steam  or  other 
vapors,  oils,  or  electricity  as  their  motive  force.  Again,  molder  ap- 
prentices take  only  that  part  of  the  program  which  falls  within  their 
allotted  apprentice  period ;  and  unless  it  is  done  at  their  request, 
they  do  not  get  instruction  in  magnetism  and  electricity,  which  in 
its  elementary  treatment  is  taught  all  other  apprentices.  Advanced 
electricity  is  given  only  to  high-school  graduates. 

In  all  these  subjects,  so  far  as  possible  and  practicable,  problems 
relating  to  the  industrial  life  of  the  apprentices  are  selected  ;  with 
many  of  these  problems  the  apprentices  have  come  in  contact  in 


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246       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

their  work  in  the  foundry  and  shops,  and  the  solution  of  many 
more  will  be  required  of  them  later  on  when  they  have  become 
skilled  mechanics,  foremen,  or  superintendents. 

A  very  important  phase  of  the  educational  work  relates  to  the 
teaching  of  mechanical  and  freehand  drawing  and  of  tool  designing. 
The  apprentices  are  first  taught  the  use  of  drawing  instruments  in 
the  making  of  straight  and  curved  lines  and  combinations  of  the 
same  and  then  are  taught  projection.  In  its  further  development 
the  course  teaches  how  to  copy  and  later  how  to  design  simple  and 
more  complicated  elements  of  machines  and  mechanisms.  Special 
attention  is  directed  to  the  necessity  of  proper  dimensioning  of 
drawings. 

This  instruction  is  not  for  the  purpose  of  making  mechanical 
draftsmen  of  the  apprentices,  although  some  with  ability  for  such 
work  will  naturally  graduate  into  positions  as  draftsmen  and  de- 
signers ;  it  is,  however,  considered  essential  as  a  foundation  for 
developing  the  ability  of  correctly  reading  and  understanding  me- 
chanical drawings  in  accordance  with  which  shop  work  is  to  be 
performed.  Mechanical  drawing  is  also  a  prerequisite  for  the  subse- 
quent instruction  in  tool  designing.  Much  emphasis  is  laid  on  the 
teaching  of  tool  design,  for  it  is  realized  that  good  ability  to  design 
jigs,  fixtures,  and  other  auxiliary  tools  for  economical  manufacture 
of  parts  reacts  upon  and  stimulates  good  ability  in  correctly  de- 
signing the  parts  themselves  so  that  they  can  be  readily  machined. 
Before  this  work  is  taken  up  apprentices  are  given  a  brief  course  in 
freehand  sketching,  in  order  that  they  may  acquire  the  art  and  ability 
of  expressing  themselves  quickly  on  paper  in  the  language  of  the 
technical  man.  The  art  of  good  and  quick  freehand  sketching,  so 
much  needed  by  the  mechanic,  the  foreman,  the  superintendent,  the 
designer,  and  the  engineer,  is  all  too  frequently  lacking  or  only  in- 
sufficiently developed  in  these  men. 

Talks  of  a  practical  nature  on  subjects  closely  related  to  their 
shop  training  or  to  matters  of  allied  interest  are  frequently  given 
to  the  apprentices.  In  a  particular  case  the  superintendent  was 
exhibiting  a  wrongly  sharpened  tool  which  he  had  found  in  use  by  an 
operative.  The  superintendent  took  advantage  of  this  concrete  in- 
stance of  error  to  provoke  a  keen  discussion  of  the  right  and  wrong 
ways  of  applying  mechanical  principles  to  the  cutting  of  metal,  the 


APPRENTICESHIP  IN  THE  METAL  TRADES        247 

object  being  to  draw  out  the  information  from  the  apprentices  them- 
selves rather  than  to  offer  it  in  lecture  fashion.  Other  ^'practical 
talks"  endeavor  to  explain  natural  phenomena,  the  practical  appli- 
cations of  which  the  apprentices  know  intuitively  and  accept  as  a 
matter  of  course  without  usually  being  able  to  explain  them.  Why 
should  the  temperature  at  the  top  of  a  high  mountain  be  considerably 
lower  than  at  its  base,  when  the  top  is  so  much  nearer  to  the  sun, 
the  universal  source  of  heat  ?  Why  should  a  one-inch  drill,  assuming 
for  the  purpose  of  discussion  that  it  absolutely  retains  its  size,  drill 
a  larger  hole  in  cast  iron  than  in  steel  ?  Such  questions  are  per- 
tinent illustrations  of  the  practical  character  of  the  instruction,  the 
one  to  show  the  effect  of  the  density  of  the  atmosphere,  the  other 
to  bring  out  the  grinding  effect  of  pulverized  cast  iron  as  it  crowds 

behind  the  drill. 

Practical  talks,  moreover,  offer  a  splendid  opportunity  for  the 
works  physician  to  speak  of  the  importance  of  personal  hygiene, 
accident  prevention,  proper  treatment  of  injuries ;  and  for  superin- 
tendents, foremen,  and  department  heads  to  explain  special  proc- 
esses of  manufacture  or  methods  of  business  procedure. 

High-school  graduates  who  desire  to  become  efficient  draftsmen 
and  designers,  electrical  testers  and  installation  engineers,  and  tech- 
nical salesmen  go  through  a  three-year  apprenticeship.  They  receive 
instruction  in  the  Engineering  School  of  the  factory,  based  upon  a 
completed  high-school  course.  Their  mathematics  starts  with  alge- 
bra and  comprises  instruction  in  trigonometry  and  analytical  geom- 
etry as  well  as  an  introduction  to  calculus.  Special  emphasis  is  laid 
upon  advanced  mechanical  drawing  and  machine  design,  mechanics 
and  mechanisms,  thermodynamics,  elementary  electricity,  electrical 
measurements,  and  the  theory  and  operation  of  direct  and  alternating- 
current  electrical  machinery.  The  character  of  the  instruction  is 
like  that  previously  described  for  grammar-school  graduates,  but 
is  more  advanced  and  intensified  in  degree,  as  is  also  the  practical 
work,  first  in  the  machinist  training  room  and  then  in  the  drafting 
and  testing  departments  as  well  as  in  the  engineering  offices. 

The  Apprentice  School  has  nine  terms,  the  Engineering  School 
seven  terms ;  this  makes  it  possible  for  the  apprentices  to  complete 
their  school  work  during  the  prescribed  periods  of  apprenticeship, 
even  if  they  should  be  held  back  in  one  or  two  classes. 


!! 


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248       TRADE  UNIOxXISM  AND  LABOR  PROBLEMS 

The  Company  is  also  concerned  with  the  development  of  a  cer- 
tain amount  of  social  life  among  the  apprentices ;  it  realizes  that 
''all  work  and  no  play  makes  Jack  a  dull  boy."  One  or  two  picnics 
in  the  summer,  some  dances  during  the  winter,  frequent  informal 
meetings  in  the  apprentice  clubroom,  an  annual  dinner  for  the  Ap- 
prentice Alumni  Association,  are  among  the  recreational  activities 
encouraged  by  the  Company. 

This  brief  description  of  some  of  the  important  features  of  the  Gen- 
eral Electric  Company's  apprenticeship  system,  now  extended  to  its 
factories  in  various  parts  of  the  country,  is  presented  in  the  hope  that 
it  will  stimulate  active  interest  in  one  of  the  most  pressing  needs 
of  industry  ;  namely,  the  effective  training  of  an  adequate  supply 
of  intelligent,  skilled  workers,  who  take  pride  in  their  work,  whether 
it  be  that  of  a  mechanic,  or  an  engineer,  or  that  of  an  executive 
supervising  mechanics  and  engineers.  At  the  same  time  it  is  hoped 
to  make  clear  that  what  has  been  done  by  one  large  corporation  on 
a  large  scale  can  be  done  as  efficiently  by  smaller  corporations  on  a 
correspondingly  smaller  scale.  The  same  fundamental  principles 
of  training  apply,  and  the  same  effective  results  can  be  obtained  ; 
the  smaller  plants  have  simpler  needs,  which  can  be  accommodated 
by  simpler  organization  and  equipment. 

When  an  employer  or  his  responsible  assistant  has  once  grasped 
the  importance  of  training  "for  industry  in  industry"  and  has 
learned  to  understand  the  fundamental  lines  along  which  an  ef- 
fective system  for  the  training  of  men  must  be  developed,  he  will 
always  find  ways  and  means  of  translating  his  enthusiasm  and 
determination  into  practical  results. 


Magnus  W.  Alexander 


National  Industrial  Conference  Board 


XIX 

PROFIT-SHARING  IN  THE  UNITED   STATES^ 

THE  intensity  of  the  industrial  unrest  of  the  last  decade  brought 
in  its  train  numerous  analyses  of  its  principal  causes.  Among 
these  the  matter  of  the  relatively  low  incomes  of  the  working  classes 
seems  to  rank  first  and  foremost.  To  augment  the  workers'  earnings 
without  seriously  disturbing  the  regular  run  of  trade  and  industry 
has  become  the  desideratum  of  students  of  labor  questions,  statesmen, 
philanthropists,  and  employers.  In  the  opinion  of  a  considerable  num- 
ber of  such  public-spirited  citizens  profit-sharing  furnishes  one  of 
the  least  costly  and  most  effective  methods  of  achieving  the  desired 
result. 

A  question  as  to  the  meaning  of  profit-sharing  immediately  arises. 
The  term  "profit-sharing"  has  been  extended  in  popular  usage  to 
include  numerous  gain-sharing  or  bonus  schemes  the  essential  char- 
acter of  which  places  them  outside  of  a  correct  interpretation  of 
the  term.  Many  of  the  schemes  known  as  profit-sharing  systems, 
although  providing  some  supplementary  remuneration  to  the  regu- 
lar earnings  of  the  beneficiaries,  do  not  bear  any  direct  relation  to 
the  actual  earnings  of  the  enterprise  and  cannot,  therefore,  be 
classified  as  involving  the  principle  of  profit-sharing  in  the  proper 
sense  of  the  term.  As  a  matter  of  fact,  very  few  of  the  methods 
adopted  by  American  employers  for  the  purpose  of  augmenting  the 
ordinary  earnings  of  their  employees  can  properly  be  called  profit- 
sharing  as  defined  by  the  International  Cooperative  Congresses.^ 

iFrom  Journal  of  Political  Economy,  Vol.  XXVI  (1917),  PP-  1019-1033. 

2 The  term  "profit-sharing,"  strictly  speaking,  was  defined  by  the  Inter- 
national Cooperative  Congress,  held  in  Paris,  France,  1889,  as  "an  agreement 
freely  entered  into,  by  which  the  employees  receive  a  share,  fixed  in  advance, 
of  the  profits."  The  same  congress  defined  the  term  "agreement"  as  covering, 
"not  only  agreements  binding  in  law,  but  as  including  also  cases  where  the 
agreement  is  only  a  moral  obligation,  provided  it  is  honorably  carried  out."  The 
term  "profit"  is  to  mean  "the  actual  net  balance  or  gain  realized  by  the  opera- 
tions of  the  undertaking."   A  "share"  is  stated  to  be  "a  sum  paid   to  the 

249 


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2  50       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


Before  proceeding  any  farther  it  is  necessary  to  define  exactly 
what  in  the  following  article  is  meant  by  the  term.  The  under- 
standing of  the  writer  is  that  profit-sharjng,  in  order  to  be  genuine, 
must  contain  the  following;  elements :  ((p) aggregates  to  be  distnb- 
uted  to  the  participants,  or  individual  sHares^  are^  to  depend  princi- 
pally upon  the  earnings  oi^the  business  ;^^^£^  the  proportion  of  the 
earnings  to  "beHistributed  isjto  be  definitely  determined  in  advance ; 
(3)  benefitTof*the  scheme  are  to  extend  to  at. least  one  third  of  the 
ordinary  wage-earnin[i  or  salary-earning  employees.  The  formulated 
definition,  although  less  rigid  tTTan  that  of  the  Cooperative  Con- 
gresses, excludes  from  the  category  of  profit-sharing  all  schemes 
under  which  bonuses  based  upon  individual  efficiency  are  paidj  usu- 
ally associated  with  the  various  phases  of  scientific  management.  It 
further  eliminates  from  consideration  actual  profit-sharing  schemes 
the  benefits  of  which  are  limited  to  a  selected  few  of  the  better- 
paid  executive  or  supervisory  employees. 

Different  reformers  (some  students  of  industrial  problems,  as 
well  as  employers)  have  frequently  addressed  themselves  to  a  con- 
sideration of  profit-sharing  with  enthusiasm  and  hope.  Profit-sharing, 
in  the  opinion  of  President  Emeritus  Eliot,  of  Harvard,  may  furnish 
one  of  the  principal  means  for  a  satisfactory  solution  of  the  indus- 
trial strife  of  our  present  day.^  The  effectiveness  of  such  schemes 
in  minimizing  class  conflicts,  however,  has  never  been  appraised. 
Following  the  publication  of  the  latest  edition  of  Oilman's  "  Profit- 
Sharing  between  Employer  and  Employee"  in  1896,  no  compre- 
hensive survey  of  the  extent  of  genuine  profit-sharing  in  the  United 
States  was  made  until  recently.  Such  a  survey  now  appears  in  one 
of  the  publications  of  the  United  States  Bureau  of  Labor  Statistics.^ 

employee  out  of  the  profits,"  such  share  to  be  "dependent  upon  the  amount 
of  the  profits."  The  share  given  to  the  employee  "shall  not  be  indeter- 
minate"; that  is,  "it  must  not  be  a  share  which  an  employer  fixes,  at  the  end 
of  some  period,  at  his  absolute  discretion,  as  distinguished  from  a  prearranged 
basis."  The  relative  proportion  of  the  total  working  force  of  a  concern  that 
must  share  in  the  profits  in  order  to  establish  real  profit-sharing  conditions 
was  stated  to  be  "not  less  than  75  per  cent."  {Bulletin  de  la  participation  aux 
benefices,  Paris,  Tome  XIX  (1807),  pp.  220-222,  cited  by  D.  F.  Schloss,  Methods 
of  Industrial  Remuneration,  chap,  xvii,  London,  i8q8.) 

^  Charles  W.  Eliot,  "  Profit-Sharing,"  in  "  Profit-Sharing  and  Scientific  Man- 
agement" (four  addresses.  Efficiency  Society  of  New  England,  Boston,  1914), 
pp.  3-9;  also  "The  Road  to  Industrial  Peace,"  The  Nation's  Business,  August, 
1917,  p.  16.  2 "Profit-Sharing  in  the  United  States,"  Bulletin  No.  208. 


PROFIT-SHARING  IN  THE  UNITED  STATES  251 
The  precise  nature  of  this  report  may  be  inferred  from  the  fact 
that  in  the  course  of  its  preparation  all  profit-sharmg  plants  known 
olve  been  in  existence  were  visited  for  the  purpose  of  exarnmmg 
carefully  the  nature  of  the  schemes  in  operation,  the.r  objects,  and 
th  results  achieved.  This  study  reveals  the  fact  that  there  are  at 
the  present  time  in  operation  in  the  United  States  sixty  genuine 
profit-sharing  plans.  The  number  of  employees  employed  under 
profi  -sharing  agreements  does  not  exceed  thirty  thousand-an  m- 
Sficantly'small  group  when  compared  with  the  total  wage-earmng 

population  of  the  country. 

The   existing  profit-sharing   plans   are   of   comparatively   recent 
origin    only   seven   of  them -or  about   one  mnth -having   been 
esabl  shed  prior  to  1900.    Twenty-nine -or  almost  one  ha  f-have 
been  established  since  19"-   Over  two  thirds  have  been  m  opera- 
tion less  than  ten  years.   Of  the  latter  group,  twenty-one,  or  about 
one  third  of  all,  were  put  into  effect  in  1914,   mS,  and  1916- 
Over  six  tenths  of  the  profit-sharing  establishments  are  located  m 
three  states.-Massachusetts,  New   York,   and   Oh.o,-and   more 
than  one  half  of  them  are  in  the  North  Atlantic  section  of  the 
country  =  The  size  of  the  twenty-eight  profit-sharing  establishments, 
as  indfcated  by  the  average  number  employed  during  a  representa- 
tive period,  reveals  the  fact  that  more  than  seven  t«n*s  of  tho  e 
reporting  employed  less  than  three  hundred  people  and  that  ody 
sShtly  over  10  per  cent  employed  one  thousand  or  ^re.     O    th 
thfrty-seven  establishments  reporting  the  proportion  of  the  tota 
employed  who  participated  in  the  distributed  profits    nineteen    or 
SM  per  cent,  reported  80  per  cent  and  over  parfcpaUng;  thirteen 
or  Is  I  per  cent,  reported  60  to  80  per  cent  participating ;  four,  or 
08  per  cent,  r^poned  40  to  60  per  cent  participating ;  and  on^y 
ol  reported  ;o  to  40  per  cent  of  all  the  employees  sharing  in  the 

^'in'nine  tenthsJiiJifi  plans  the  principal  prerequisite  for  participa- 

tionlrSr^mnanency  of  affiliation  with  the  employing  company,  as 

shown  by  aspecific  length  of  continuous  service.   The  mmimum  of 

ondnuous  se^ice  required  varies  from  three  months  to   hree  years 

the  length  of  time  specified  in  more  than  one  half  of  all  the  plans 

,U.S.  Bureau  of  Labor  Statist!..  Bulletin  No.  -«  (.-■'>;  P'  '^ 
2/5id.  p.  18.  '^^^• 


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252        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

being  one  year  or  less.    Thus  practically  ajl  the  plans  exclude  from 

confining  the  benefits  to  their  more  or  less  permanent  employees' 
In  about  one  eighth  of  the  plans  in  operation  employees,  in  order  to 
participate,  are  required  to  file  a  written  application  especially  pro- 
vided for  that  purpose.    Such  applications  are  usually  perfunctory 
statements  signed  by  the  employees  to  the  effect  that  they  promise 
to  do  faithful  work  and  be  loyal  to  the  company.    In  one  instance 
employees  obligate  themselves  contractually  to  share  in  the  possible 
losses  of  the  year's  business  in  proportion  to  their  earnings,  but  not 
to  exceed  10  per  cent.    Under  this  plan  10  per  cent  of  the  weekly 
earnings  of  each  of  the  participating  employees  is  retained  by  the 
company  until  the  end  of  the  distribution  period,  when  the  amounts 
thus  retamed  are  returned  to  the  employees  together  with  their  share 
of  profits  for  the  year.    In  the  great  majority  of  the  plans  studied 
the   basis    for   computing   individual    shares   is    relatively   simple- 
namely,  the  amount 'of  earnings  of  the  participants.    The  individual 
^^y^^  ^"-gHgh  instances  are  determined  by  dividing  the  employees' 
^art  in  the  divisible  fund  by  the  aggregate  of  wages  of  the  part'ici- 
pants  m  order  to  obtain  what  is  usually  called  the  profit-shariirg 
dividend,  and  then  multiplying  this  dividend  by  the  respective  earn- 
mgs  of  each  of  the,:particjpants.    " 

In  all  of  the  plans  except  one,  discharge  and  leaving  employment 
act  automatically  as  causes  for  forfeiting  the  share  of  profits  for  the 
current  year.    Under  one  plan,  only  a  discharge  for  cause  results  in 
forfeiture ;  other  discharges,  being  more  in  the  nature  of  permanent 
lay-offs  on  account  of  lack  of  work,  do  not  deprive  employees  of  their 
proportionate  share  of  the  profits.    Some  of  the  plans  under  which 
shares  of  profits  are  paid  in  stock  or  in  the  form  of  savings  accounts 
penalize  those  leaving  employment  more  severely  than  those  who  are 
discharged,  it  being  specified  in  these  instances  that  those  leavin- 
forfeit  some  part  of  the  share  of  the  profits  of  the  previous  year-! 
usually  from  one  fifth  to  one  third— in  addition  to  the  share  of  the 
current  year's  profit.    The  provision  that  death  shall  be  a  cause  of 
forfeiture  occurs  only  in  about  one  half  of  the  plans ;  in  the  other 
plans  it  is  specified  that  the  pro-rata  share  of  the  deceased  employee 
shall  be  paid  to  his  family  or  dependents.    In  profit-sharing  plans 


PROFIT-SHARING  IN  THE  UNITED  STATES        253 

under  which  the  shares  of  profits  constitute  some  proportion  of  the 
dividends  paid  on  capital  the  amounts  of  forfeited  shares  are  usually 
retained  by  the  employer.  In  other  plans  the  amounts  forfeited  do 
not  revert  to  the  employer,  but  are  apportioned  instead  among  the 
participating  employees. 

The  majority  of  plans  in  operation  specifically  provide  that  em- 
ployees temporarily  laid  off  but  otherwise  eligible  to  participate  and 
ready  to  return  to  work  upon  call  be  not  barred  from  participation. 
Their  shares  in  such  instances  are  based  on  their  actual  earnings. 
In  one  third  of  the  plans  cases  of  lay-off  are  treated  *'each  upon  its 
own  merits."  The  same  treatment  as  that  of  employees  laid  off  is 
accorded  to  those  taken  sick,  provided  the  sickness  does  not  extend 
"over  an  unreasonably  long  period" — usually  not  over  six  months. 
Under  one  plan  only  is  it  specifically  stated  that  sickness  of  an 
employee  carries  with  it  a  forfeiture  of  his  share  of  the  profits.  In 
this  instance,  however,  the  company  maintains  a  special  fund  for 
the  benefit  of  its  sick  employees. 

Under  thirty-two  plans,  or  more  than  three  fourths  of  those  re- 
porting, the  shares  in  profits  were  paid  fully  in  cash.  Five  reported 
as  paying  in  "part  stock  or  savings  account  or  common  fund  and 
part  cash."  Of  these  the  following  proportions  were  paid  in  cash: 
one,  99  per  cent ;  one,  90  per  cent ;  one,  85  per  cent ;  one,  80  per 
cent ;  and  one,  10  per  cent.  Under  two  plans  the  shares  of  profits 
were  credited  to  a  common  fund,  which  was  utilized  for  the  accumula- 
tion of  a  pension  reserve  which  was  to  be  made  up  in  equal  parts  of 
the  shares  of  profits  and  contributions  by  the  employees. 

The  benefits  accruing  to  the  participating  employees  as  a  result 
of  the  operation  of  the  profit-sharing  plans  during  one  representative 
distribution  period,  in  terms  of  a  percentage  of  the  regular  earnings 
of  participants,  are  shown  in  the  table  on  page  254. 

Under  almost  one  third  of  the  plans  the  profit-sharing  dividend  on 
the  regular  earnings  "of  the  "parlicTpants  wastess^than  6^er  cent. 
Slightly  over  one  third  of  the  establishments  paid  dividends  varying 
from  6  to  10  per  cent.  The  remaining  third  of  the  establishments 
paid  dividends  of  10  per  cent  or  more.  Of  the  latter,  five  establish- 
ments paid  profit-sharing  dividends  of  20  per  cent  or  more.^ 

lU.  S.  Bureau  of  Labor  Statistics,  Bulletin  No.  208  (1917),  P-  i9- 


ill 


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254       TRADE  UNIOxMSM  AND  LABOR  PROBLEMS 

Percentage  of  Regular  Earnings  received  as  Share  of  Profits  in 
Thirty-four  Profit-Sharing  Establishments 

Classified  Percentage  of 

Earnings  received  as  Number  of 

Share  of  Profits  Establishments 

Under  2 i 

2  and  under    4 6 

4  and  under    6 a 

6  and  under    8 y 

8  and  under  10 r 

10  and  under  15 r 

15  and  under  20 j 

20  and  under  30 j 

30  and  under  40 2 

40  and  under  50 j 

50  and  over i 

Total Ta, 

Three  main  reasons  may  be  presented  as  accounting  for  the  rela- 
tlyely^low  profit-sharing  dividends  paid  under  the  plans.    They  are 
( i)  the  small  proportions  of  their  net  profits  that  employers  are  ready 
to  shaFeTT2)lTie  rather  large  nuniLers  bflSeneficiaries  ;  and  (jTlhe 
method  used  in  some  of  the  plans  in  determining  the  relative  interStT 
of  employer  and  employees  in  the  divisible  fund.    The  last-mentioned 
reason  is  the  least  apparent  and  needs  a  brief  explanation.    In  the 
plans  under  which  the  method  of  distribution  explains  the  low  profit- 
sharing  dividends  it  is  usually  provided  that  net  profits  set  aside__ for 
distribution  are JoJ)e_  apportioned  between  employer  and  employees 
"in  proportlorTto  their  respective  interests."    The  employer,  who  is 
invariably  the  formulator  of  the  scheme,  usually  assumes  that  his 
interest  in  the  divisible  fund  is  represented  by  the  amount  of  his 
capital,  while  that  of  the  employees  can  best  be  measured  by  the 
labor  pay  roll.   Aside  from  the  fact  that  this  assumption  is  unsound, 
—  the  earning  power  of  capital  rather  than  its  amount  being  more 
analogous,  if  at  all  comparable,  to  the  labor  pay  roll,— this  method 
of  determination  of  relative  interests  results  in  a  distribution  of  the 
fund  in  a  ratio  of  at  least  three  to  one  in  favor  of  capital,  for  the 
reason  that  the  annual  cost  of  labor  seldom  exceeds  one  fourth  of 
the  amount  of  capital  invested.    That  the  method  of  determining  the 
relative  interests  of  the  participants  is  largely  responsible  for  the  low 


PROFIT-SHARING  IN  THE  UNITED  STATES       255 

dividends  paid  may  more  clearly  be  seen  from  the  fact  that  the  only 
profit-sharLg  establishment  in  the  United  States  -  moderately  suc- 
cessful-that  has  been  paying  considerable  profit-sharing  dividends 
(an  average  of  85  per  cent  for  the  period  of  1907-1916)  based  its 
relative-interest  theory  upon  the  earning  power  of  capital  instead  o 
its  amount.  As  a  result  of  this,  distributions  were  made  at  the  ratio  0 
about  three  to  one  in  favor  of  labor.  A  computation  based  upon  actual 
figures  shows  that  had  the  usually  prevailing  notion  of  relative  inter- 
'rts  been  applied  in  this  establishment  the  distribution  ratio  would 
have  been  quite  different,  namely,  five  to  one,  and  in  favor  of  capital. 
From  a  study  based  upon  the  facts  and  figures  found  n  the  recent 
report  of  the  Federal  Bureau  of  Labor  Statistics,  supplemented  by 
personal  observations,  the  following  conclusions  may  be  drawn: 

I.  Almost  seven  tenths  of  the  profit-sharing  plans  examined  by  he 
mentioned  report  of  the  Bureau  of  Labor  Statistics  yielded  to  the 
beneficiaries  an  annual  augmentation  of  their  earnings  of  less  than 
xo  per  cent.  Therefore,  if  labor  difficulties  are  to  be  solved  through 
considerable  augmentations  of  the  incomes  of  the  employees  pro^^^^^^ 
sharing,  as  it  stands  at  the  present  time,  will  not  do  i  .  No  one  at  all 
familiar  with  the  nature  of  the  present-day  wage  conflicts  can  possibly 
venture  the  opinion  that  even  an  all-around  wage  increase  of  10  pe^^ 
cent  will  contribute  materially  toward  the  establishment  of  industrial 
peace  and  the  creation  of  a  general  harmony  of  interests^ 

2    If   again,  industrial  peace  is  to  be  brought  about  by  a  better  1 
und'erstanding  between  employer  and  employees  and  the  development 
Tmutual  confidence  based  upon  some  degree  of  democratization 
of  industry,  profit-sharing,  in  its  present  form  at  least,  can  hardly  \ 
render  any  appreciable  assistance.    The  profit-sharing  employer    s 
"t  as  kee'n  about  his  traditional  prerogatives  to  hire  and  fire  and  to 
run  his  business  regardless  of  the  opinion  of  his  emp^^^^  ^/J^ 
non-profit-sharing  confreres.    Trade-unionism  and  -11-  ^^^^^^^^ 
ing  are  no  more  popular  in  profit-sharing  establishments  than  else- 
where    In  fact,  no  profit-sharing  firm  is  known  to  have  m  ope  ation 
Inv  system   o\  coUective  bargaining   or  of   definitely   established 
friendly  relations  with  trade-unions.    In  this  connection  i   may  be  of 
interest  to  observe  that  one  of  the  oldest,  most  widely  known,  and 
mS  successful  profit-sharing  employers  specifically  excludes  from 
lU.S.  Bureau  of  Labor  Statistics,  Bulletin  No.  208  (1917),  PP-  37-44- 


,1^ 


256       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  benefits  of  his  scheme  certain  groups  of  his  employees  who  through 
unionization  have  raised  their  rates  of  wages  "  to  an  unusually  high 
point,"  on  the  theory  (taught  him  by  experience)  that  "good 
union  men  are,  as  a  rule,  poor  cooperators."  On  the  contrary,  instead 
of  evoking  good  will,  profit-sharing,  on  account  of  its  arbitrary  char- 
acter under  which  employers  unconditionally  reserve  to  themselves 
the  privilege  to  discontinue  or  modify  the  entire  arrangement,  is  a 
rather  potent  breeder  of  suspicion  and   distrust. 

Although  substantially  agreeing  that  their  plans  have  greatly  im- 
proved their  relations   with   the  employees  and   contributed   con- 
siderably to  the  stabilization  of  their  working  force,  profit-sharing 
employers  disagree  greatly  as  to  the  results  achieved  with  reference  to 
increasing  the  individual  or  collective  efficiency  of  the  participating 
employees.    Only  three  out  of  sixty  stated  definitely  that  increased 
efficiency  has  resulted  ;  and  these  have  paid  unusually  high  profit- 
sharing  dividends  to  their  employees  in  the  past.   Aside  from  profit- 
shanng    employers,    neither    employees    nor    employers    have    any 
confidence  in  profit-sharing.  As  far  as  the  former  can  give  expression 
to^their  opmions,  they  have  put  themselves  on  record  as  opposed  to 
it.i    This  attitude  of  employees  toward  such  schemes  is  usually  ex- 
plained by  the  fact  that,  in  the  opinion  of  their  leaders,  profit- 
shanng  plans  have  an  inevitable  tendency  to  hinder  the  development 
of  trade-unionism  and  collective  bargaining.    Labor  leaders  are  of  the 
opmion  that  these  schemes  make  increased  earnings  uncertain,  con- 
tmgent  wholly  upon  employers'  profits  and  payable  only  "at' their 
(  own  sweet  will."   An  informant  belonging  to  a  labor  organization 
explamed  his  opposition  to  profit-sharing  on  the  ground  that  "there 
is  no  sense  in  playing  a  game  the  rules  and  regulations  of  which  are 
formed  without  the  consent  of  one  of  the  principal  parties  concerned 
such  rules,  furthermore,  being  subject  to  change  at  any  time  without 
common  consent."   Workmen,  he  said,  prefer  unqualified  increases  in 
wages  to  a  problematical  share  in  the  employers'  enterprises  in  the 
management  of  which  they  do  not  partake.    Employees,  furthermore 
have  no  faith  in  profit-sharing,  because  under  only  one  of  the  plans 
m  existence  are  they  granted  the  privilege  of  inspecting  the  books  of 

EmX'ers'''"'rtiol?r-"'^''r  ^''''  "^^"  ^^  "Profit-Sharing  by  American 
PP   233-243^  Federation,  Welfare  Department,  Report   (1916), 


PROFIT-SHARING  IN  THE  UNITED  STATES       257 

the  employer  in  order  to  convince  themselves  that  the  full  share  due 
them  has  been  distributed.  Suspicion  is  further  augmented  because 
under  a  majority  of  the  plans  the  prospective  beneficiaries  are  not 
even  given  an  inkling  as  to  the  specific  proportion  of  the  profits  that 
their  employers  are  willing  to  share.  What  is  there  then,  employees 
repeatedly  say,  to  prevent  an  unscrupulous  employer  from  juggling 
his  profit-and-loss  account  in  order  to  avoid  the  payment  of  the 
promised  benefits? 

The  attitude  of  profit-sharing  employees  toward  such  schemes  is 
interesting  and  instructive.   As  a  rule  this  attitude  varies  with  the 
nature  of  the  position  held  by  the  informant  and  with  his  general 
views  on  industrial  questions.    In  all,  three  distinct  attitudes  were 
observed;  to  wit,  complete_apprqval,  absolute  condemnation,  and_a 
general  indifference  which  took  profit-shlnngTs'Tmatter  of  course. 
Profit-sKarmg^employees  who  hold  well-paid  supervisory  or  execu- 
tive positions  were  definitely  in  favor  of  the  plans.    To  this  small 
group  of  participants  the  scheme  appeared  to  be  an  actual  realization 
of  a  state  of  community  of  interest  between  employer  and  employee. 
Among  the  bulk  of  the  ordinary  wage-earners  two  distinct  opinions 
prevailed.    If  the  informant  happened  to  be  a  member  of  a  trade- 
union  or  was  an  ardent  believer  in  organized  labor  and  collective 
bargaining,  his  opinion  on  profit-sharing  was  analogous  to  those  of 
the  labor  representatives  cited  above ;  namely,  absolute  disapproval 
of  the  scheme  irrespective  of  the  benefits  that  might  accrue  to  the 
participants.    To  informants  of  this  group  the  profit-sharing  plan 
was  a  carefully  planned  attempt  on  the  part  of  the  employer  to 
stimulate  production,  forestalling  at  the  same  time  the  possibility  of 
collective  demands  for  higher  wages  and  better  conditions  of  em- 
ployment.   The  proportion  of  participating  employees  that  expressed 
this  opinion  was  not  very  large  and  constituted,  perhaps,  not  more 
than  one  fifth  of  those  interviewed.    The  attitude  of  the  great  ma- 
jority of  the  participating  employees  was  one  of  general  indifference. 
Profit  distributions  were  taken  as  a  matter  of  course,  were  expected, 
and  were  relied  upon  in  the  balancing  of  their  income  and  expendi- 
ture accounts.    The  employers'  motives  were  not  questioned  as  long 
as  distributions  continued   at  regular  intervals.   If,  however,   the 
shares  paid  grew  less  or  their  distribution  irregular,  suspicion  was 
engendered  and  dissatisfaction  with  the  scheme  aroused. 


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2  58       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  profit-sharing  field  is  rather  unique  in  the  sense  that  under 
its  arrangements  additional  duties  carry  with  them  no  new  rights. 
Under  most  of  such  schemes  the  employees  are  constantly  reminded  of 
the  fact  that  they  are  no  longer  mere  employees,  that  they  are  part- 
ners in  the  business  and  are  therefore  expected  to  conduct  themselves 
as  such — to  avoid  any  moves  or  acts,  such  as  requests  for  better 
conditions  and  higher  wages,  that  will  inconvenience  the  business. 
These  new  duties,  however,  involve  no  established  rights  to  benefits, 
for  each  of  the  schemes  specifically  reserves  to  the  employer  the 
right  (i)  to  determine  which  of  the  employed  shall  participate  and 
under  what  conditions  they  may  do  so,  (2)  to  hire  and  fire  at  pleasure, 
and  (3)  to  discontinue  or  modify  the  entire  arrangement  without  no- 
tice or  consent  of  the  employees.^  Legally  shares  in  profits  thus  be- 
come mere  gratuities,  which  the  employer  may  or  may  not  dispense.^ 

That  profit-sharing  is  not  popular  with  employers  may  easily  be 
inferred  from  the  little  headway  that  such  wage  schemes  have  made 
in  the  United  States  as  well  as  from  the  very  small  number  of  em- 
ployees working  under  profit-sharing  conditions.  Jlmployers  have 
but  little  faith  in  profit-sharing,  because  they  cannot  see  how  dfs- 
tributions  made  upon  any  other  basis  than  that  of  individual  efficiency 
can  possibly  contribute  to  the  augmentation  of  their  profits.^  Con- 
sidered as  a  direct  stimulus  to  efficiency,  real  profit-sharing  cannot 
possibly  succeed,  because,  under  it,  individual  shares  are  to  bear  no 
direct  relation  to  anything  but  the  earnings  of  the  business.  Again, 
some  employers  feel  that  from  a  strictly  equitable  viewpoint  em- 
ployees admitted  to  participation  in  the  profits  are  morally  bound 
to  be  willing  to  share  in  the  possible  losses  of  the  business.  Un- 
fortunately, aside  from  the  fact  that  ordinary  workers  do  not  earn 

1  Commenting  upon  a  certain  pension  scheme  under  which  the  annuity  allow- 
ances to  be  granted  are  expressly  described  as  not  a  "right"  of  employees,  Bab- 
son^  Confidential  Labor  Bulletin,  L-83,  August,  1917,  says:  "We  do  not 
believe,  though,  that  a  plan  of  this  kind  meets  the  demands  of  labor  in  these  days 
or  is  quite  in  tune  with  the  spirit  of  the  age.  If  we  are  not  mistaken,  there 
is  a  growing  demand  among  workers  for  a  recognition  of  rights  over  and  above 
wages.  Clients  should  not  expect  a  plan  of  this  kind  to  exercise  any  influence 
on  radical  employees." 

2 For  a  detailed  discussion  of  the  legal  status  of  profit-sharing,  see  U.S. 
Bureau  of  Labor  Statistics,  Bulletin  No.  208,  p.  6. 

3  The  desire  for  increased  profits,  and  not  philanthropy,  was  responsible  for 
the  origin  of  most  of  these  schemes.  U.  S.  Bureau  of  Labor  Statistics,  Bulle- 
tin No.  208  (191 7),  p.  170. 


PROFIT-SHARING  IN  THE  UNITED  STATES       259 

enough  to  maintain  a  satisfactory  standard  of  living,^  much  less  to 
assist  employers  in  meeting  business  losses,  one  may  appropriately 
doubt  the  wisdom  or  even  the  desirability  of  asking  anyone  to  share 
in  the  losses  of  an  enterprise  the  management  of  which  was  to  him 
a  sort  of  terra  incognita — a  sphere  absolutely  outside  of  his  legiti- 
mate jurisdiction  or  even  inquiry .^ 

The  degree  of  effectiveness  of  these  schemes  depends   directly 
upon  the  amount  of  benefits  accruing  to  the  participants.     These 
benefits  have  been  rather  small,  equivalent  in  many  instances  to 
less  than  what  ordinarily  grateful  employers  in  thousands  of  estab- 
lishments are  in  the  habit  of  distributing  as  Christmas  gifts  in  the 
form  of  cash  bonuses,  "gold  pieces,"  and  turkeys.    Profit-sharing 
does  not  even  succeed  in  evoking  any  of  the  stimuli  to  efficiency 
that  Christmas  gifts   usually   do— perfunctory   "thank  you"   and 
some  additional  good  will  to  last  until  after  New  Year's  Day.    On 
the  contrary,  no  matter  how  large  or  small  the  amounts  distributed 
may   be,  the  one-sidedness  of  the   arrangement   and  its  absolute 
control  by  the  employer  make  the  participants  feel  suspicious  lest 
they  do  not  get  all  they  should.    For  entirely  different  reasons  this 
feeling  of  dissatisfaction  and  lack  of  confidence  in  the  value  of  the 
scheme  appears  also  in  the  mind  of  the  employer.    Somehow  or  other 
he  cannot  help  feeling  that  from  the  point  of  view  of  greater  profits 
more  satisfactory  results  could  be  obtained  with  less  pretense  and 
annoyance,  through  improvements  in  working  conditions  and   in- 
creases in  wages  based  upon  the  payment  of  bonuses  for  individual 

efficiency. 

W^atltheii-is^  alter  all,  the  raison  d'etre  of  the  existing  profit- 
sharing  schemes,  few  though  they  may  be?  To  this  question  the 
Following  answers  may  be  suggested: 

I.  The  advertising  value  of  the  schemes^  the  very  name  of  which 
is  high-sounding  and  appeals  to  the  popular  mind.  The  advertising 
value  of  profit-sharing,  it  was  said,  was  particularly  great  in  mer- 
cantile establishments  which  cater  to  the  trade  of  working  people, 
such  as  grocery  and  department  stores  and  mercantile  institutions 

1  Cf.  W.  Jett  Lauck  and  Edgar  Sydenstricker,  Conditions  of  Labor  in  Amer- 
ican Industries,  New  York  (1917),  PP-  357-363- 

2  The  same  argument  could,  of  course,  be  advanced  against  participation  in 
the  profits  by  employees  who  do  not  directly  assist  in  the  management  of  the 
business. 


ii 


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260       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

selling  their  goods  on  the  installment  plan.  Managers  of  two  such 
establishments  were  certain  of  the  beneficial  value  of  their  profit- 
sharing  plan  in  this  respect. 

2.  The  nature  of  somebusiness  organizations,  under  which  it  is 
difficult  r6~correlate  directly  individual  efficiency  witEnts— corre- 
spondiii^  xe_ward.  The  value  of  this  factor  to  the  employer  was  clearly 
brought  out  by  the  vice  president  of  the  Executives'  Club  of  Detroit 
in  an  article  entitled,  "Where  Profit-sharing  Fails  and  where  it 
Succeeds."  The  author  says :  "  Considered  merely  as  a  stimulus  to 
increased  production  and  greater  net  gain,  profit-sharing  is  of  par- 
ticular value  in  plants  where  ( i )  individual  efficiency  cannot  yet  be 
exactly~meastired,  or  where  (ay  much  work  is  done  fax  ^way  from 
supervision,  or  where  (3)  longevity  of  service  is  necessary  to  preserve 
the  quality  of  the  product  or  to  "guard  trade  secrets,  or  wheFe~(4)  a 
supplement  to  the  wage  system  promoting  individual  efficiency  is 
needed  to  minimize  plant  waste."  ^ 

3.  The  effect  of  the  schemes  upon  the  labor  turnover.  Profit- 
sharing,  particularly  in  the  establishments  in  which  the  business  is 
prospering  and  in  which  distributions  are  made  at  regular  intervals, 
does  seem  to  have  a  beneficial  influence  upon  the  stability  of  the 
organization.  One  profit-sharing  employer,  who  made  a  very  care- 
ful study  of  the  effect  of  his  plan,  describes  this  effect  as  follows: 
"It  [profit-sharing]  works  precisely  like  an  increase  in  wages,  but 
is  more  valuable  because  the  employee,  in  order  to  receive  his  share, 
has  to  wait  till  the  end  of  the  distribution  period,  a  fact  that  makes 
him  hesitate  before  quitting,  which  would  naturally  involve  the 
forfeiting  of  his  share  in  the  profits." 

4.  The  momentum  of  some  of  the  older  plans  which  makes  profit- 
sharing  a  sort  of  tradition  which  is  difficult  to  abandon. 

5.  The  sense  of  social  justice  of  some  employers.  To  this  factor 
is  due  the  existence  of  three  profit-sharing  schemes  the  principal 
object  of  which  was  stated  to  be  "an  equitable  distribution  of 
the  profits  of  the  undertaking,  as  a  matter  of  justice,  irrespective 
altogether  of  hopes  for  increased  efficiency." 

6.  Xljei^elieliiif  some  employers  that  profit-sharing  will  develop  good 
will,  diminish  industrial  strife,  and  stimulate  efficiency,  obviating  at 
the  same  time,  perhaps,  the  necessity  of  granting  increases  in  wages. 

^System  Magazine,  March,  1916. 


PROFIT-SHARING  IN  THE  UNITED  STATES       261 

An  examination  of  the  causes  specified  by  employers  as  having  been 
responsible  for  the  abandonment  of  profit-sharing  plans  that  they  are 
known  to  have  had  in  operation  reveals  the  interesting  fact  that 
many  of  the  plans  were  discontinued  because  the  new  order  of  things 
failed  to  appeal  to  the  prospective  beneficiaries,  who  preferred  the 
certainty  of  ordinary  increases  in  wages  to  the  uncertainty  of  the 
potential  profits  at  the  end  of  the  distribution  period.^  Demands  on 
the  part  of  the  new  partners  for  increased  wages  usually  appeared 
unreasonable  and  unfair  to  the  employer,  who  quickly  decided  to 
abandon  the  scheme.  One  student  of  this  question  has  summarized 
the  nature  of  profit-sharing  in  its  bearing  upon  this  conflict  of  opinion 
as  follows : 

It  is  obvious  that  if  profit-sharing  is  based  upon  favor,  the  so-called 
divisions  of  profits  are  nothing  more  nor  less  than  Christmas  presents 
or  other  periodical  gifts  and  therefore  cannot  be  considered  as  a 
serious  economic  factor. 

If  profit-sharing  is  predicated  upon  the  mutual  rights  and  obliga- 
tions arising  out  of  relation  of  employer  and  employee,  or  if  it  is 
based  upon  some  equitable  right  or  obligation  flowing  out  of  that 
relation,  it  is  then  permitted  to  ask  at  what  point  in  that  relation, 
or  under  what  circumstances,  does  the  right  to  demand  an  increased 
wage  cease  and  the  right  to  demand  a  share  of  profits  begin  ? 

Unless  there  is  some  method  of  general  application  by  which  that 
point  may  be  established,  it  comes  down  to  this,  that  the  employer, 
and  he  alone,  can  say  when,  to  what  extent,  and  under  what  cir- 
cumstances the  employee  shall  be  permitted  to  exercise  his  supposed 
right — an  arrangement  which  not  only  makes  the  employer  the  um- 
pire but  permits  him  to  change  the  rules  in  the  middle  of  the  game.- 

One  cannot  help  but  feel  that  the  illogical  character  of  profit- 
sharing,  as  outlined  briefly  in  this  article  as  well  as  by  the  authors 
quoted,  presents  one  of  the  reasons  why  genuine  profit-sharing  plays 
such  a  negligible  role  in  the  wage  systems  of  advanced  industrial  coun- 
tries. The  effectiveness  of  any  economic  arrangement  does  not 
necessarily  depend,  of  course,  upon  its  power  to  appeal  to  logicians 
or  jurists.  Prnfit-^hnring  has  failed  to  h^sj^vne  nf  nny  rnnsequenre 
among  the  other  wage  systems  ior-the  simple  leasou  that  it  has  failed 
tu  appear  to  the  instinct^pL  econmnic  sell-interest  of  capital  and 

HJ.  S.  Bureau  of  Labor  Statistics,  Bulletin  No.  208  (1917),  P-  166. 
-Francis   X.    Butler,   article   in   "Profit-Sharing   by   American    Employers," 
National  Civic  Federation,  Welfare  Department,  Report,  pp.  258-259. 


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262       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

labor  and  because  its  tendency  to  increase  efficiency  and  profits_.  on 
m\t  liAiul,  ur  appreciably  t6.  augment  the  earnings  of  the  em- 
ployees  oft  the  "other,  lias  been  very  limited.  ~ 

Earnest  advocates  of  profit-sharing  may  take  exception  to  these 
conclusions.  They  may  state  that  the  failure  of  profit-sharing  to 
make  any  appreciable  headway  among  other  wage-payment  systems 
is  due  to  the  fact  that  it  is  being  operated  under  unfavorable  con- 
ditions.  President  Eliot  may  rightly  emphasize  the  point  that  the 
elements  or  "adjuncts"  which  he  considers  as  essential  to  the  success 
of  profit-sharing,  such  as  large  distributions,  welfare  work,  pensions, 
sale  of  stock  to  employees  at  reduced  rates,  and  ''cooperative  manage- 
ment,"^ are  seldom  found  in  conjunction  with  the  existing  profit- 
sharing  plans.  This  is  substantially  correct.  The  report  of  the  Federal 
Bureau  of  Labor  Statistics  referred  to  above  shows  that  almost  three 
fourths  of  the  plans  distributed  shares  equivalent  to  less  than  10  per 
cent  of  the  ordinary  earnings  of  the  beneficiaries ;  that  is,  amounts 
not  sufficiently  large  in  the  opinion  of  President  Eliot-  to  affect  the 
efficiency  and  develop  a  sense  of  partnership  on  the  part  of  the  em- 
ployees. Although  many  of  these  establishments  are  known  to  be 
engaged  in  some  sort  of  welfare  work,  few  of  them  are  large  enough 
and  financially  stable  enough  to  install  and  maintain  pension  funds. 
Many  of  the  profit-sharing  firms  are  small  and  have  no  marketable 
stock  to  sell  to  their  employees.  And,  as  brought  out  in  the  preceding 
pages,  very  few  profit-sharing  employers  manifest  any  great  interest 
in  what  President  Eliot  terms  cooperative  management.  The  absence 
of  some  of  the  factors  thought  of  as  essential  to  the  success  of  profit- 
sharing  raises  the  question  as  to  the  reasons  for  this  absence.  And, 
as  far  as  one  may  judge  correctly  from  the  opinions  of  numerous 
employers,  the  answer  to  this  question  is :  genuine  profit-sharing— 
that  is,  profit-sharing  not  related  directly  to  individual  efficiency— 
does  not  pay. 

Boris  Emmet 

^Dr.  Charles  W.  Eliot,  "The  Road  to  Industrial  Peace,"  The  Nation's  Busi- 
ness, August,  191 7,  p.  16.  •  ^Ibid. 


XX 

PROFIT-SHARING  IN  THE  BAKER  MANUFAC- 
TURING COMPANY^ 

THE  year  1893  was  a  bad  year.  It  was  the  year  of  the  panic.  Our 
employees  did  not  earn  their  dividend,  nor  did  they  earn  it  the 
next  year.  In  the  spring  of  1894  it  was  very  difficult  to  keep  running. 
Money  was  difficult  to  borrow,  collections  were  poor,  and  orders 
scarce.  Common  labor  in  those  days  commanded  $1  a  day.  Concerns 
about  us  cut  wages,  and  we  decided  that  the  only  way  to  keep 
going  was  to  cut  wages.  We  called  the  men  together  and  announced 
a  cut.  They  did  not  like  it.  We  asked  the  men  to  come  together  with 
us  and  try  to  devise  some  method  of  profit-sharing  for  the  future,  but 
they  were  not  interested  in  sharing  profits  with  a  concern  that  had  no 
profits  to  share.  As  time  went  on,  profits  again  appeared  and  the 
year  1897  was  particularly  prosperous,  and  in  the  spring  of  1898  we 
declared  an  extra  10  per  cent  dividend. 

At  each  of  the  annual  meetings  the  matter  of  profit-sharing  was 
brought  up.  Nothing  was  done,  however,  until  the  spring  of  1899. 
Then  the  president,  Mr.  Almeron  Eager,  came  out  and  said  he  was 
willing  to  share  profits.  He  said,  "  The  Bakers  have  made  a  success  of 
the  business,  and  if  they  want  profit-sharing,  I  for  one  am  willing 
that  they  should  have  it."  The  other  stockholders  agreed,  and  a  lib- 
eral form  of  profit-sharing  was  devised.  They  decided  to  become 
authorized  to  issue  $300,000  of  stock:  $200,000  to  be  preferred  and 
issued  to  the  old  stockholders  for  their  old  stock,  two  shares  of  the 
new  for  one  share  of  the  old;  the  other  Sioo,ooo  to  be  common 
stock  and  issued  in  profit-sharing  as  profits  were  earned. 

At  this  time  they  had  $208,000  of  net  assets,  $8000  in  excess  of 
the  new  preferred,  and  they  decided  that  to  get  the  good  will  of  the 
men  they  would  pay  them  a  10  per  cent  cash  bonus  on  their  past 

iprom  an  address  before  the  Second  Annual  Industrial  Service  Conference, 
Milwaukee,  Wisconsin,  April  28,  1919. 

263 


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264       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

year's  wages,  and  any  small  amount  left  over  would  be  paid  to  the 
stockholders  as  an  extra  dividend.  The  men  were  called  together. 
There  was  one  fellow  who  refused  to  come  and  advised  some  of  his 
fellow  men  not  to  come.  He  told  them,  "They  are  only  going  to 
cut  wages  again." 

At  the  meeting  the  men  were  paid  a  10  per  cent  cash  bonus  on  their 
past  year's  wages  and  told  that  in  the  future  the  Company  would 
share  its  profits  liberally  with  them.  They  were  very  much  surprised. 
It  was  explained  that  an  inventory  would  be  taken  each  year,  and 
if  after  paying  the  regular  5  per  cent  dividend  on  all  stock  there 
should  be  a  gain,  10  per  cent  of  it  was  to  be  put  into  a  sinking  fund 
and  the  rest  divided  between  preferred  stock  and  employees  in  pro- 
portion to  the  earnings  of  each.  Employees  in  this  case  meant  all 
persons  in  the  employ  of  the  Company  at  the  factory  for  over  two 
years,  managers  as  well  as  laborers  and  mechanics. 

If  the  employees  should  receive  during  the  year  $30,000  wages 
and  preferred  stock  $10,000  dividends,  then  the  division  was  to  be 
between  the  employees  and  preferred  stockholders  as  thirty  to  ten. 
Three  fourths  of  the  gain  after  setting  aside  the  sinking  fund  would 
go  to  employees  and  one  fourth  to  preferred  stockholders.  This 
meant  we  capitalized  labor  at  twenty  times  its  earnings. 

The  first  year  went  by,  and  we  figured  up  and  found  we  had  60  per 
cent  to  add  to  preferred  dividends,  bringing  our  total  dividends  up 
to  8  per  cent,  and  we  had  60  per  cent  to  add  to  employees'  wages. 
These  amounts  were  not  paid  in  cash ;  only  15  per  cent  was  paid  in 
cash  and  the  other  85  per  cent  in  common  stock. 

The  directors  had  decided  that  it  would  be  the  policy  of  the  Com- 
pany not  to  buy  the  stock.  They  did  not  wish  to  draw  cash  out  of 
the  business  by  buying  the  stock ;  they  wished  to  buy  labor-saving 
machinery,  enlarge  their  plant,  and  put  themselves  in  better  shape  to 
compete.  But  there  was  one  fellow  who  wanted  to  sell.  He  had  three 
or  four  shares,  and  the  president  said,  "It  is  common  to  look  upon 
common  stock  as  watered  stock,  and  we  want  to  show  these  fellows 
that  it  is  really  worth  something  and  has  $100  of  real  value  back  of 
it."  He  moved  that  in  this  case  we  buy  in  the  stock  at  par.  We  made 
the  offer  and  it  was  accepted,  and  the  man  was  very  much  pleased. 

We  continued  year  after  year.  The  percentages  added  to  preferred 
dividends  and  to  employees'  wages  during  the  first  eight  years  ran 


THE  BAKER  MANUFACTURING  COMPANY        265 

like  this:  January,  1900,  60;  1901,  82  ;  1902,  74;  1903,  9^ ;  1904, 
69;  190S,  28;  1906,  81;  1907,  120. 

It  was  soon  apparent  that  there  would  be  stock  continually  coming 
on  the  market.  The  men  organized  themselves  and  tried  to  buy  it  as 
fast  as  it  was  offered.  They  wished  to  keep  hold  of  it,  and  they  wished 
to  maintain  the  price  at  par.  At  first  they  were  successful,  but  it 
soon  came  faster  than  they  could  take  care  of  it  and  the  price  de- 
clined.  It  went  down  and  down  until  it  struck  a  level  of  about  $65 

a  share. 

The  stock  that  was  sold  went  largely  into  outside  hands ;  and 
during  this  interval  several  of  the  preferred  stockholders  (original 
stockholders)  died,  and  their  stock  went  into  the  hands  of  their  heirs. 
These  outside  stockholders  and  heirs  began  to  feel  that  they  wanted 
a  larger  share  in  the  profits,  and  they  set  about  to  get  it.  Their  plan 
was  to  get  the  employees  to  vote  down  profit-sharing.  They  told  the 
employees  that  if  they  would  stop  sharing  profits,  the  stock  would 
return  to  par.  They  also  offered  as  an  inducement  a  20  per  cent 
increase  in  wages  and  higher  dividends.  They  failed,  and  profit- 
sharing  continued. 

But  by  this  time  we  had  plenty  of  capital,  and  there  was  a  profit 
in  the  purchase  of  stock  below  par,  so  we  decided  to  change  our 
policy  in  regard  to  buying  stock.  Up  to  this  time  there  had  been  no 
restrictions  on  the  stock.  Employees  could  sell  to  whomever  they  saw 
fit.  Since  the  change  in  our  by-laws  in  1909  the  stock  has  been 
issued  only  on  the  condition  that  it  be  left  on  deposit  with  the  Com- 
pany under  contract  to  sell  to  the  Company  at  the  market  price 
whenever  the  shareholders  wish,  and  whenever  we  have  sufficient 
funds  in  our  stock-purchase  fund.  The  Company  has  the  privilege  of 
buying  the  stock  when  the  owner  goes  to  work  for  a  competitor,  when 
he  goes  into  business  for  himself,  or  when  he  has  worked  for  another 
for  five  years.  If  he  remains  with  the  Company  until  he  retires,  the 
Company  cannot  buy  the  stock  without  the  owner's  consent. 

The  market  price  of  stock  is  determined  by  averaging  the  price  of 
the  last  hundred  shares  sold.  One  of  the  principal  elements  deter- 
mining the  market  price  of  stock  is  the  sale  of  what  we  call  "stub 
shares."  The  amount  of  stock  apportioned  to  honorary  employees 
cannot  be  measured  in  full  shares  of  $100  each.  There  are  frac- 
tional amounts  left  over  ;  these  stubs  are  combined  into  whole  shares 


J>^.| 


m 


2  66       TRADE  UXIOXTSM  AND  LABOR  PROBLEMS 

and  sold  at  the  annual  meeting.  Each  owner  of  a  stub  is  entitled  to 
bid  for  these  shares ;  the  man  who  bids  the  highest  gets  the  share  or 
shares  he  bids  for  at  the  price  bid,  and  so  on  until  all  the  shares 
are  sold. 

At  first  the  stock  was  nearly  all  bought  by  preferred  stockholders 
or  by  some  of  the  better-paid  employees,  and  it  usually  went  about 
$65  a  share,  but  as  time  went  on,  it  increased  in  value  until  at  the  last 
annual  meeting  it  sold  for  a  little  over  $80  a  share,  and  at  this  time 
it  went  into  many  hands.  There  were  only  three  men  who  succeeded 
in  getting  more  than  one  share. 

We  used  to  give  15  per  cent  in  cash  and  85  per  cent  in  stock.  We 
now  give  only  10  per  cent  in  cash  and  90  per  cent  in  stock.  What 
we  used  to  call  profit-sharing  we  now  call  remaining  wage  and  extra 
preferred  dividends.  During  recent  years  we  have  had  the  following 
results:  January,  1908,  100  per  cent;   1909,  78;   1910,  100;  1911, 

100  ;  1912,  47  ;  1913,  75  ;  1914,  70  ;  1915,  90  ;  1916,  50  ;  1917,  70  ; 
1918,  100.  And  this  January  again  another  100  per  cent.  The 
average  of  all  these  figures  is  80  per  cent ;  that  is,  we  have  added  to 
preferred-stock  dividends  during  the  twenty  years  80  per  cent  an- 
nually, and  we  have  added  to  our  employees'  basing  wage  80  per 
cent  annually.  .  .  . 

Some  of  you  may  wonder  why  it  is  that  we  could  do  this,  and  I 
will  admit  that  when  I  say  the  average  percentage  has  been  80  per 
cent,  it  is  somewhat  misleading.   Not  all  of  our  employees  receive 
this  remaining  wage  each  year,  only  those  who  have  become  honorary 
employees;    that  is,  worked  4500  hours.     If  we  had  divided  the 
same  amounts  among  all  of  our  employees,  it  would  have  resulted  in 
about  64  per  cent  average  in  place  of  80  per  cent ;  and  we  do  not 
figure  these  percentages  in  every  case  on  our  employees'  actual  wages. 
We  do  with  the  office  employees  and  dayworkers,  but  not  with  piece- 
workers.   In  their  case  we  base  it  on  the  wages  they  would  have 
received  had  they  worked  daywork  instead  of  piecework.   At  piece- 
work they  usually  earn  about  25  per  cent  more  than  they  do  at  day- 
work.    Had  we  divided  with  our  pieceworkers  on  their  actual  wages, 
it  would  have  cut  the  percentage  from  64  to  about  55  per  cent. 

Again,  if  we  had  gone  out  in  the  open  market  for  our  capital,  we 
would  have  had  to  pay  6  to  7  per  cent  for  it,  whereas  we  only  pay 
5  per  cent  on  our  common  stock. 


THE  BAKER  MANUFACTURING  COMPANY        267 

Then,  there  has  been  a  profit  in  the  purchase  of  our  stock  at  less 
than  par  from  the  people  who  have  left  our  employ.  We  have  been 
purchasing  it  at  the  market,  which  has  varied  all  the  way  from 

65  to  80  per  cent  of  par. 

Taking  all  these  things  into  consideration,  it  probably  would  have 
reduced  the  average  percentage  to  about  45  or  50  per  cent.  That  is 
to  say,  had  the  division  been  with  all  our  employees  and  on  their 
whole  weekly  wages,  and  had  we  paid  7  per  cent  for  all  our  capital 
and  bought  no  stock  at  less  than  par,  our  average  percentage  would 
have  been  about  45  or  50  per  cent.   Where  has  it  come  from  ? 

Some  may  perhaps  think  we  have  not  done  the  fair  thing  by  our 
preferred  stockholders,  or  that  we  have  perhaps  paid  a  small  weekly 
wage  in  order  that  we  might  pay  a  large  remaining  wage  at  the  end 
of  the  year.   Let  us  see  what  we  have  done  for  our  preferred  stock.   I 
can  remember,  on  several  occasions  before  we  went  into  this,  some  of 
the  original  stockholders  wanted  to  sell,  but  they  couldn't  find  a  buyer. 
There  was  really  no  market  for  their  stock,  and  when  we  first  started 
there  was  only  $100  of  property  back  of  each  share  of  preferred  ;  but 
as  time  has  gone  on  this  amount  has  increased,  and  today  there  is  be- 
tween $700  and  $800  to  earn  the  dividend  on  each  share  of  preferred. 
It  is  to  some  extent  invested  in  bonds,  and  the  income  on  these  bonds 
alone  is  sufficient  to  pay  the  preferred-stock  dividend  two  or  three  times 
over.  So  we  have  increased  the  security  of  preferred  stock  enormously. 
The  Company  has  a  standing  offer  to  buy  preferred  stock  at  Si 40  a 
share,  and  besides  this  we  have  paid  preferred  for  the  past  twenty 
years  an  average  annual  dividend  of  9  per  cent.    Roughly,  6  per  cent 
of  this  9  per  cent  has  been  paid  in  cash,  the  rest  in  common  stock. 

Then,  as  to  what  we  have  done  with  labor.  I  have  investigated  on 
numerous  occasions  to  find  out  whether  we  were  paying  competitive 
wages.  I  will  mention  but  two  things.  The  United  States  Depart- 
ment of  Commerce  and  Labor  published  a  bulletin,  No.  57,  applying 
to  the  year  1905.  In  that  bulletin  they  stated  that  the  average  wage 
for  windmill  manufacturers  for  the  year  was  $503.  The  average  of 
the  Baker  employees  for  the  year  was  $561.  The  output  of  the 
windmill  manufacturers  of  the  nation  was  $2486  per  employee.  The 
output  for  our  employees  was  $3400.  Bulletin  No.  75,  applying  to 
the  same  year,  stated  that  the  agricultural-implement  concerns  on 
the  average  paid  $539,  and  the  average  output  per  man  was  $2347. 


fl'T' 


» 


:}* 


I 


2  68       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Now,  where  does  it  come  from  ?  It  is  my  belief  that  this  is  largely 
the  result  of  increased  production  due  to  increased  effort  and  intelli- 
gence of  our  men,  and  that  if  you  destroy  this  remaining-wage 
scheme  this  production  would  not  continue. 

I  believe  the  overhead  per  man  is  less  where  the  men  have  an  in- 
centive such  as  we  have  offered.  To  illustrate:  Suppose  a  barber 
running  one  chair  has  an  income  of  $8  per  day,  and  his  expenses  are 
$4.  He  has  made  for  himself  $4.  And  supposing  he  should  decide 
that  he  is  going  to  put  forth  every  effort  and  increases  his  output 
10  per  cent.  The  income  would  then  be  S8.80,  the  expenses  would 
remain  the  same,  and  he  would  have  $4.80  for  himself.  Or  with  a 
10  per  cent  increase  in  output,  he  has  made  20  per  cent  increase  in 
earnings.  You  have  heard  it  said  that  a  rented  house  needs  more 
repairs  and  depreciates  faster  than  a  house  in  which  the  owner 
lives.  I  can  remember  that  my  mother  used  to  say  that  a  hired 
girl  would  often  prove  practically  worthless  and  be  inattentive  and 
let  her  work  go,  but  as  a  rule  the  same  woman  after  she  married 
and  had  a  house  of  her  own  would  be  a  good  housekeeper  and 
become  thrifty. 

We  had  an  experience  which  I  wish  to  relate.  Some  eighteen  years 
ago  we  wished  a  galvanizing  plant.  We  contracted  with  an  expert 
galvanizer  to  come  to  our  plant  and  do  our  galvanizing  on  a  ton 
basis.  The  contract  was  drawn  up  in  such  a  way  that  we  were  to 
know  his  cost,  and  at  the  end  of  four  years  it  was  our  privilege  to 
buy  him  out.  We  did,  but  kept  his  men,  giving  them  the  same  wages 
that  he  had  paid  them,  but  we  told  them  that  if  they  would  make 
the  cost  of  galvanizing  less  than  it  had  been,  we  would  share  liberally 
with  them.  And  they  did ;  they  made  the  cost  less  under  those  con- 
ditions than  they  had  when  one  man,  the  foreman,  got  all  the  benefit 
of  the  increased  production.  .  .  . 

These  remaining  wages  separate  us  from  some  good  men,  but  this 
would  be  natural,  for  every  man  wants  to  be  his  own  boss.  It  fur- 
nishes them  with  capital  with  which  to  go  into  business,  and  we  have 
had  a  number  of  valuable  men  leave  us,  whereas  if  they  had  not  had 
the  capital  they  could  not  have  left  us.  Quite  a  number  of  men  have 
sold  their  stock  to  make  their  first  payments  on  farms.  Three  or  four 
years  ago  I  was  up  in  the  Lake  Superior  country,  and  between  trains 
my  wife  and  I  stopped  off  at  Chetek  to  see  an  old  schoolmate  of  hers, 


THE  BAKER  MANUFACTURING  COMPANY        269 

who  lived  in  the  country.  On  the  way  the  schoolmate  pointed  out  five 
different  farmers  who  had  got  their  start  from  the  sale  of  our  stock. 
Our  turnover  for  a  number  of  years  prior  to  1917  averaged  24  per 
cent ;  for  the  year  1917,  5o  per  cent ;  for  the  year  1918  it  was  60  per 
cent    We  carry  our  own  employees'  liability  insurance.   It  has  aver- 
aged for  seven  years  past  25  cents  per  $100  pay  roll.   Forty  per 
cent  of  our  employees  own  their  own  homes ;  28  per  cent  owri  auto- 
mobiles ;  more  than  half  our  capital  is  owned  by  our  employees 
I  think  that  capital  should  be  in  the  hands  of  those  persons  who  will 
make  it  serve  the  people  best ;  that  is,  who  will  make  it  do  the  greates 
good  to  the  greatest  number.   Our  capital  is  going  into  the  hands  of 
those  persons  who  have  served  the  longest  and  held  the  most  impor- 
tant positions,  and  I  trust  they  will  handle  it  more  wisely  than  wou  d 
parties  who  were  not  so  familiar  with  the  business  nor  so  vitally 

interested  in  it.  ,  t    vi,     j 

Cooperative  societies  are  often  a  side  issue,  the  owners  livelihood 
is  not  gained  through  them ;  to  a  large  extent  they  are  everybody  s 
business.  With  us  cooperation  is  our  principal  business,  our  bread 
and  butter.   Whatever  we  can  save  or  produce  more  than  workmen 

usually  produce  is  ours. 

Our  board  of  directors  is  composed  of  our  foundry  foreman, 
windmill-machine-shop  foreman,  superintendent,  buyer,  cost  account- 
ant and  mvself.  On  the  afternoon  of  the  annual  meeting  we  close 
the'shop  and  hire  the  city  hall  for  the  meeting ;  most  of  the  employees 
attend  and  are  interested  in  knowing  the  Company's  business  affairs 
It  seems  to  me  that  this  is  much  better  than  to  have  the  capital 
owned  almost  wholly  in  Chicago  or  New  York,  financial  matters 
largely  a  secret  from  the  employees  and  neither  capital  nor  abor 
really  knowing  the  other  fellow's  side.  If  you  separate  capital  too 
completely  from  labor,  the  conditions  become  unstable. 

I  believe  that  if,  in  ordinary  times,  any  corporation  will  get  the 
good  will  of  its  employees  and  tell  them  that  the  stockholders  in  the 
future  will  be  paid  the  average  amount  the  stock  has  earned  (say  for 
the  past  five  years),  and  any  amount  which  the  Company  earns  in 
addition  to  this  will  be  divided  among  the  employees,  the  amount 
which  will  be  coming  to  the  employees  will  be  surprising. 

John  S.  Baker 

President,  Evansvule,  Wisconsin 


^ 


11 


ii 


1.1 


Mi 


I'll 


XXI 

A  PLAN  FOR  COLLECTIVE   BARGAINING  AND 
COOPERATIVE  WELFARE^ 

A  GLANCE  BACKWARD 

AT  THE  close  of  the  year  19 lo  the  former  management  of  the 
l\  Philadelphia  Rapid  Transit  Company  found  itself  bankrupt  in 
cash.  It  had  also  lost  the  confidence  of  its  employees  and  of  the 
public. 

The  $30,000,000  paid  in  by  the  stockholders  in  payment  of  their 
stock  had  been  spent,  together  with  all  other  money  which  the 
management  could  secure  by  mortgage  and  other  means. 

In  1909  and  19 10  the  earnings  had  not  been  sufficient  to  pay  the 
operating  costs,  rentals,  and  interest  by  over  $1,500,000. — to  say 
nothing  of  earning  a  return  on  the  $30,000,000  paid  in  by  the  stock- 
holders, who  had  then  gone  nearly  eight  years  without  receiving  any 
return  upon  their  money. 

Nearly  three  fourths  of  the  cars  in  service  were  of  the  old  four- 
wheel  type,  together  with  the  rebuilt  horse  cars  (known  as  "cuts"). 
There  was  little  protection  and  no  comfort  while  riding  on  these  cars, 
either  for  the  men  or  the  public. 

Accidents  had  increased  to  an  alarming  extent,  caused  by  unfit 
equipment  and  the  general  unrest  of  the  men,  who,  after  experiencing 
two  serious  strikes  in  1909  and  19 10,  were,  in  a  dissatisfied  way, 
working  under  the  terms  of  a  wage  settlement  provided  as  the  result 
of  arbitration. 

The  maximum  wage  of  conductors  and  motormen  in  191 1  was 
23  cents,  and  this  maximum  rate  was  to  be  increased  one-half  cent  per 
hour  on  July  i  of  each  year  until  19 14,  when  the  high  rate  for  men 
over  five  years  in  service  was  to  be  25  cents  per  hour. 

In  this  emergency  Mr.  E.  T.  Stotesbury  was  petitioned  by 
the  stockholders  to  take  charge  of  the  management  and  save  the 

1  Publication  by  Philadelphia  Rapid  Transit  Company,  1918. 

270 


PLAN  FOR  COLLECTIVE  BARGAINING  271 

situation.    Mr.  Stotesbury  undertook  this  thankless  job,  without  pay, 
and  engaged  Mr.  T,  E.  Mitten  to  represent  him  in  the  management 

of  the  property.  ,  .  ,    , 

The  public  was  made  satisfied  with  promises,  which  have  smce 

been  faithfully  met. 

The  stockholders  were  told  that  they  must  still  wait  for  any  return 
upon  their  $30,000,000  until  both  men  and  public  had  been  accorded 

fair  treatment.  . 

The  condition  of  the  Company  was  explained  to  the  men,  and  it 
was  pointed  out  that  it  would  be  impossible  for  the  Company  to 
survive  if  it  increased  the  proportion  of  its  earnings  then  being  paid 
to  its  conductors  and  motormen,  which  approximated  22  cents 
out   of    every   dollar  received    by    the    Company  in    fares    from 

passengers. 

A  promise  was  made  by  Mr.  Mitten  at  this  time,  191 1,  that  if  the 
men  would  cooperate  under  a  plan  by  him  set  forth,  22  cents  out  of 
every  dollar  received  by  the  Company  in  fares  from  passengers  would 
be  set  aside  in  a  fund  to  be  used  for  payments  to  conductors  and 
motormen.  Mr.  Mitten  stated  that,  in  this  event,  the  maximum 
wage  attained  by  the  close  of  a  five-year  period,  July,  1916,  would, 
in  his  opinion,  be  not  less  than  28  cents  per  hour. 

It  was  in  August,  19 11,  that  the  Cooperative  Plan  was  adopted  by 
the  Stotesbury  management  and  accepted  by  vote  of  the  men  in 
November  of  the  same  year.  ^ 

The  Cooperative  Plan  has  well  stood  the  test  of  over  seven  years 
vicissitudes.    Through  its  agency  mutually  satisfactory  working  con- 
ditions have  been  established  and  maintained. 

The  public  have  had  a  continuity  of  service,  as  against  the  strike 
conditions  previously  prevailing,  and  over  $16,000,000  has  been 
spent  for  new  cars  and  other  improvements.  During  the  year  ended 
June  30,  1918,  741,140,866  passengers  were  carried  at  an  average 
fare  of  3.96  cents  per  passenger  as  against  432,884,253  passengers 
carried  at  an  average  fare  of  4.15  cents  per  passenger  during  the 

year  ended  June  30,  1910. 

The  men  actually  received  31  cents  per  hour  at  the  close  of  the 
five-year  period,  1916,  as  against  the  28  cents  originally  estimated, 
and  this  was  increased  as  of  July  15,  1918,  to  43  cents  per  hour  as 
a  result  of  the  workings  of  the  Cooperative  Plan. 


272       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Prior  to  the  recent  raise  to  48  cents  per  hour  (to  accord  with  the 
National  War  Labor  Board  Scale)  the  Cooperative  Plan  had  pro- 
duced an  increase  of  20  cents  per  hour  in  maximum  pay,  amounting 
to  $5,368,153.18  more  in  this  period  than  the  men  would  have  re- 
ceived under  a  continuation  of  the  strike-settlement  scale.  This  is 
the  greatest  increase  of  wages  obtained  in  any  American  city  during 
this  period. 

Greater  advantages  in  sick  and  death  benefits  were  assured. 

Improved  working  conditions  and  modern  devices  for  controlling 
the  mechanism  of  the  cars  were  installed,  to  which  the  men  responded 
by  cutting  the  number  of  accidents  in  half. 

The  principle  of  the  Cooperative  Plan,  as  originally  established, 
that  is,  that  employees  may  belong  to  any  union  or  other  organization 
without  "  let  or  hindrance,"  has  proved  to  be  the  rock  of  its  depend- 
ence and  the  disarming  of  its  opponents.     Of  the  two  attempted 
strikes,  neither  proved  effective  in  causing  serious  interruption  to 
service.    The  attempt  in  the  present  year  was  so  timed  as  to  take 
full  advantage  of  the  depleted  force  occasioned  by  the  draft  require- 
ments of  the  government.    It  afforded  the  most  striking  demonstra- 
tion of  the  effectiveness  of  cooperative  effort  between  the  Company 
and  employees,  in  that  the  cars  necessary  to  provide  the  extra  service 
to  war  workers  were  at  once  manned  and  operated  for  several  weeks 
by  volunteers  from  all  departments  of  the  Company,  so  effectively 
that  when  called  upon  to  answer  the  complaint  made  to  the  War 
Labor  Board  at  Washington  the  management  was  able  to  prove  by 
the  representatives  of  the  shipyards,  arsenals,  etc.  that  service  had 
not  been  interrupted  and  was  being  adequately  supplied.    As  a  con- 
sequence the  War  Labor  Board  dismissed  the  complaint,  following 
our  voluntarily  undertaking  to  adopt   the  wage  scale  then   being 
established  by  the  War  Labor  Board  to  govern  the  cities  of  Chicago, 
Cleveland,  Detroit,  and  Buffalo,  and  our  further  undertaking  to 
give  the  objecting  employees  opportunity  of  continuous  employment 
during  good  behavior. 

The  investigation  of  the  War  Labor  Board,  and  the  cross-exami- 
nation of  those  of  us  who  appeared  as  representing  the  Cooperative 
Plan,  brought  out  certain  points  in  the  plan  there  shown  as  capable 
of  being  misrepresented  and  misunderstood.   This,  together  with  the 


PLAN  FOR  COLLECTIVE  BARGAINING  273 

abolition  of  the  2  2  per  cent  fund,  the  establishment  of  the  War  Labor 
Board  basis  for  the  new  wage  scale,  and  the  apparent  desirability  of 
a  broadening  and  enlargement  of  certain  features  of  the  plan,  made 
necessary  the  preparation  of  an  amended  plan,  which  has  been  sub- 
mitted to  the  employees,  by  means  of  United  States  mail,  in  such  a 
way  as  to  present  the  opportunity  for  examination  and  decision  under 
influence  of  the  home  and  counsel  of  the  family. 

The  stockholders  received  a  total  of  $2,847,933.50  in  dividends, 
and  a  5  per  cent  dividend  rate  has  been  established.  They  have 
also  a  greatly  improved  condition  of  their  property,  including  the 
equity  of  the  undistributed  surplus  income  accumulated  under  this 

management. 

The  Cooperative  Plan  has  thus  demonstrated  what  can  be  accom- 
plished where  both  men  and  management  strive  together  for  one 
common  purpose. 

A  LOOK  FORWARD 

The  Stotesbury-Mitten  management,  as  a  result  of  the"  past  seven 
years'  experience,  now  presents  the  following  statement  of  policy  and 
practice,  which  it  is  proposed  shall  hereafter  cover  the  joint  undertak- 
ings of  the  men  and  the  management  in  the  way  of  cooperative  effort. 

The  principle  of  the  Cooperative  Plan  of  191 1,  that  is,  that  em-r 
ployees  may  belong  to  any  union  or  other  organization  without  'Met 
or  hindrance,"  is  hereby  ratified  and  confirmed ;  it  being  understood, 
however,  that  in  the  interest  of  service  to  the  public  the  rules  of  the 
Company  must  be  obeyed. 

Satisfactory  service  insures  continuous  employment  with  the  Com- 
pany. In  the  event  of  there  being  such  a  decrease  in  the  business 
of  the  Company  as  makes  it  necessary  to  reduce  the  force,  those 
giving  the  least  satisfactory  service  shall  be  the  first  to  be  dropped 
from  the  pay  roll  of  the  Company. 

There  shall  be  no  discrimination  against  employees  who,  for 
any  reason,  do  not  become  members  of  the  Cooperative  Welfare 
Association. 

Cooperative  effort  is  recognized  as  the  keystone  of  all  accomplish- 
ment in  rendering  proper  service  to  the  public,  and  good  service  will 
be  recognized  by  such  advancement  as  opportunity  offers. 


'A 


I 


274       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Wages 

The  War  Labor  Board,  in  its  wisdom,  determined  upon  an  advanced 
wage  for  employees  of  street  railways.  This  management,  in  agree- 
ment with  the  Cooperative  Committee,  advanced  the  wages  of  its 
trainmen  another  5  cents,  to  a  maximum  of  48  cents  per  hour,  and 
has  adjusted  the  wages  of  its  other  employees  accordingly.  This  at 
once  brings  all  employees  upon  a  proper  comparative  basis  and,  by 
averaging  the  wage  scales  of  the  other  cities  of  the  first  class  under 
the  jurisdiction  of  the  War  Labor  Board,  namely,  Chicago,  Cleve- 
land, Detroit,  and  Buffalo,  gives  us  a  permanent  basis  upon  which 
to  adjust  the  wages  of  the  employees  in  each  of  the  departments 
from  time  to  time  as  occasion  may  warrant. 

This  new  basis  makes  unnecessary  the  longer  continuance  of  the 
22  per  cent  fund  and  opens  the  way  to  a  broadening  of  the  Cooper- 
ative Plan  to  include  all  employees  of  the  Company  upon  equally 
favorable  terms. 

The  original  Cooperative  Plan,  covering  the  payment  of  sick  bene- 
fits, now  provides  insufficiently  in  amount  and  imperfectly  in  time 
and  method  of  payment.  The  first  plan  of  death  benefits  and  of 
pensions  became  inadequate  and  subject  to  much  improvement. 

Therefore,  we  must  now  devote  our  energies  to  enlarging  the  scope 
of  the  Cooperative  Welfare  to  include  all  employees  one  year  in 
service,  and  to  increase  and  improve  sick  benefits,  death  benefits, 
and  pensions. 

The  government  has  been  good  to  us  in  various  ways.  The  War 
Labor  Board  has  dismissed  the  complaint,  of  those  who  were  desirous 
of  destroying  our  efficiency.  The  Emergency  Fleet  Corporation  and 
the  Bureau  of  Industrial  Housing  and  Transportation  have  ad- 
vanced us  millions  of  dollars  with  which  to  buy  new  cars  and  other 
equipment. 

The  stockholders  have  permitted  us  to  increase  wages  of  train- 
men more  than  $5,000,000  over  the  amount  which  the  men  would 
have  received  under  the  1910  strike-settlement  scale.  The  stock- 
holders themselves  have  received  less  than  $3,600,000  during  the 
seven  years,  as  a  return  upon  their  $30,000,000  of  invested  capital, 
and  have  now  again  let  us  advance  wages  to  meet  the  needs  of  the 
men,  and  this  without  knowing  where  tJie  money  is  coming  from. 


I^LAN  FOR  COLLECTIVE  BARGAINING 


275 


The  bounden  duty  of  the  men  and  the  management  under  these 
circumstances  is  to  do  their  level  best  to  cut  out  all  wasted  effort. 
Man  power  and  fuel  can  be  thereby  saved.  By  helping  the  govern- 
ment to  conserve  these  most  essential  things  we  will  not  only  be  doing 
our  patriotic  duty  but  in  addition  will  be  doing  all  in  our  power  to 
hold  down  our  rates  of  fare  to  the  lowest  possible  point  consistent 
with  the  following : 

1.  Efficient  service  to  the  public. 

2.  Payment  of  adequate  wages. 

3.  Proper  protection  of  invested  capital. 

Compensation  for  Injuries 

The  Company  will  continue  to  pay  the  compensation  as  determined 
under  the  Workmen's  Compensation  Act  for  injury  to  employees 
resulting  in: 

1.  Total  temporary  disability. 

2.  Partial  (permanent  or  temporary)  disability. 

3.  Limited  number  of  serious  dismemberments. 

4.  Total  permanent  injuries. 

5.  Fatal  injuries. 

The  period  and  amount  of  compensation  are  determined  under 
this  act  in  accordance  with  the  disability  sustained. 

Amended  Pi^n 

The  Cooperative  Plan  of  19 11,  redrawn  to  meet  the  changed  con- 
ditions, follows  and  will  be  known  as  the  Cooperative  Plan  of  19 18. 

COLLECTIVE  BARGAINING 
Voice  and  Vote 

1.  The  workers  shall  have  a  free  and  independent  vote  for  repre- 
sentatives for  proper  collective  bargaining,  and 

2.  Proper  committee  organization  of  such  representatives,  so  that 
class  and  group  contact  may  be  assured  and  the  integrity  of  workers' 
committees  be  established  and  maintained  as  such. 

Procedure 

The  business  of  Employer  is  divided  into  classes,  or  departments, 
and  each  department  is  subdivided  into  contact  groups,  or  Branches. 


i 


a ' 


2  76       TRADE  UNIONISM  AND  LABOR  PROBLEM!^ 

Differences  between  Employee  and  Employer  shall  be  settled 
through  the  medium  of 

1.  Branch  Committees. 

2.  Department  Committees. 

3.  General  Committees. 

4.  Board  of  Arbitration. 

Any  local  point  of  difference  shall  be  taken  up  by  the  Branch 
Committee  at  the  local  Branch  of  origin. 

When  a  grievance  is  not  settled  through  the  proper  Branch  Com- 
mittees, then  it  shall  be  taken  up  by  the  respective  Department 
Committees. 

When  a  grievance  is  not  settled  through  the  proper  Department 
Committees,  then  it  shall  be  taken  up  by  the  General  Committees. 

When  a  grievance  cannot  be  settled  through  the  General  Com- 
mittees, it  shall  then  be  settled  by  arbitration. 

All  appeals  shall  be  submitted  in  written  form  to  the  secretary  of 
the  respective  committees,  briefly  setting  forth  all  the  facts  of  the 
matter  at  issue. 

In  the  discussions  of  the  Department  Committees  and  of  the 
General  Committees  it  is  intended  that  Employees  shall  sit  on  one 
side  of  the  table,  so  to  speak,  and  Employer  on  the  other  side, 
throughout  the  collective  bargaining  contemplated  by  this  plan. 

The  majority  of  any  Committee  of  Employees  shall  be  the  voice 
of  that  committee. 

The  majority  of  any  Committee  of  Employer  shall  be  the  voice  of 
that  committee. 

Whenever  the  minds  of  the  majorities  of  any  committees  meet, 
the  controversy  shall  be  settled. 

While  it  is  intended  that  there  shall  be  full  and  free  discussion  in 
order  to  arrive  at  an  amicable  understanding  and  settlement  of  con- 
troversies, whenever  it  is  necessary  to  take  a  vote  to  ascertain  the 
voice  of  any  committee,  the  committees  for  the  employees  and  for 
the  employer  shall  have  the  right  to  retire  and  cast  their  vote  in  secret 
caucus.  In  such  secret  caucus  all  such  votes  shall  be  taken  by  secret 
ballot,  said  ballots  to  be  returned  unopened  to  the  secretary  for  the 
committees.  The  secretary  shall  count  the  ballots  under  the  ob- 
servation of  both  committees  and  announce  the  result  in  open 
meeting. 


PLAN  FOR  COLLECTIVE  BARGAINING 
Branch  Committees 


277 


There  shall  be  elected  two  representatives  by  the  workers  at  each 
depot,  station,  or  division.  The  candidate  receiving  the  highest  vote 
shall  be  declared  No.  i  Branch  Committeeman  for  that  depot,  sta- 
tion, or  division  for  the  ensuing  year,  and  the  candidate  receiving  the 
second  highest  vote,  in  like  manner,  shall  be  declared  No.  2  Branch 
Committeeman. 

The  employer  shall  appoint  two  representatives  for  each  depot, 
station,  or  division. 

The  two  Committeemen  elected  by  the  workers  shall  constitute 
the  Branch  Committee  for  Employees. 

The  two  representatives  appointed  by  the  Company  shall  consti- 
tute the  Branch  Committee  for  Employer. 

Committeemen  shall  be  elected  to  serve  for  the  period  of  one 
year.  It  shall  be  their  duty  well  and  truly  to  represent  their  fellow 
employees  and  to  give  all  matters  under  consideration  or  discussion 
their  best  thought  and  the  benefit  of  their  knowledge  and  experience. 

At  least  once  in  every  three  months  there  shall  be  an  opportunity 
for  a  meeting  of  workers  at  each  Branch,  when  reports  shall  be 
made  by  the  local  Branch  Committeemen. 

Elections 

The  dates  upon  which  Committeemen  elections  shall  be  held,  as 
well  as  the  hours  during  which  the  polls  will  be  open,  shall  be  so 
arranged  as  to  insure  to  every  qualified  voter  at  the  local  depot, 
station,  or  division  opportunity  to  cast  a  vote  for  one  candidate,  it 
being  stipulated  that  the  different  election  dates  shall  be  arranged 
in  such  order  and  sequence  as  to  provide  always  for  a  working 
majority  on  the  several  committees  of  members  who  are  familiar  with 
the  nature  and  routine  of  the  business  transacted. 

Notice  of  any  Branch  election  shall  be  posted  conspicuously  at 
the  said  local  Branch  twenty-one  days  in  advance  of  the  date  set  for 
the  election. 

All  elections  for  Committeemen  shall  be  by  secret  Australian  ballot 
under  the  supervision  and  direction  of  an  Election  Committee  of 
three  members  chosen  by  and  from  the  respective  Department  Com- 
mittee for  Employees. 


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278       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

All  ballots  cast,  together  with  the  official  return  of  the  Election 
Committee,  shall  be  forwarded  promptly  to  the  Secretary  of  the  De- 
partment Committee,  to  become  a  part  of  the  permanent  records. 

In  case  of  decease,  leaving  service,  or  inability  to  act  of  any 
Branch  Committeeman,  the  remaining  Committeeman  shall  act  until 
a  successor  is  elected.  An  election  shall  be  held  to  fill  the  vacancy  as 
promptly  as  possible  in  the  same  manner  as  the  original  choosing 
provided  by  this  plan. 

Qualifications  for  Voters 

To  qualify  as  a  voter  the  employee  must  have  been  six  months  in 
the  Company's  service,  be  regularly  assigned  to  duty,  and  not  occupy 
an  official  position  of  any  character  with  the  Company.  Every  voter 
shall  be  entitled  to  all  the  rights  and  privileges  under  this  plan. 

No  voter  shall  be  permitted  to  cast  a  ballot  unless  he  or  she  shall 
appear  at  the  polls  in  person  and  within  the  hours  prescribed  for  the 
election. 

Lists  containing  the  names  of  the  workers  qualified  to  vote  at  the 
election  shall  be  posted  conspicuously  at  the  local  Branch  three  days 
prior  to  the  date  set  for  the  election. 

Qualifications  for  Committeemen 

Candidates,  to  be  eligible  to  election  as  Committeemen,  must  be 
regularly  assigned  to  duty  and  have  been  continuously  in  the  employ 
of  the  Company  for  not  less  than  two  years. 

In  the  Transportation  Department  candidates  must  also  be  as- 
signed to  a  regular  run  and  be  actually  serving  in  the  capacity  of 
trainman  or  its  equivalent  grade. 

Candidates  for  election  as  Committeemen  must  file  with  the 
secretary  of  the  General  Committees,  not  less  than  thirteen  days  in 
advance  of  the  date  of  election,  official  nomination  papers,  carrying 
the  signatures  of  not  less  than  seven  workers  qualified  to  vote  at 
the  respective  Branch  location. 

It  is  not  intended  that  a  worker  shall  sign  more  than  one  nomina- 
tion petition  at  any  election. 

It  is  not  intended  that  any  employee  who  may  properly  be  said 
to  represent  Employer  shall  be  chosen  as  a  representative  of  workers. 


PLAN  FOR  COLLECTIVE  BARGAINING 


Department  Committees 


279 


I;. 


Employees  in  the  several  Departments  shall  be  represented  on  their 
respective    Department    Committees    through    their    duly    elected 

members. 

The  following  Departments  will  each  be  represented  by  its  respec- 
tive Department  Committee,  namely: 

Transportation  Department. 

Rolling-Stock  and  Buildings  Department. 

Electrical  Department. 

Way  Department. 

General  Offices  Department. 

These  Committeemen  elected  annually  by  the  employees  of  each 
Department  shall  be  equaled  in  number  by  the  Company  appoint- 
ments of  its  representatives.   Each  Committeeman  shall  be  entitled 

to  a  vote. 

Each  Department  Committee  for  Employees  shall  consist  of  all 
No.  I  Branch  Conmiitteemen  and  all  No.  2  Branch  Committeemen 
elected  by  the  workers  at  the  several  depots,  stations,  or  divisions  in 
that  Department.  In  the  event  of  decease,  leaving  service,  or  in- 
ability to  act  of  either  Branch  Committeeman,  then  the  remaining 
Branch  Committeeman  for  that  Branch  shall  act  on  the  Department 
Committee  until  a  successor  is  elected  in  the  manner  hereinbefore 
provided  for  filling  a  vacancy  on  a  Branch  Committee. 

Officers 

The  Department  Committee  for  Employees  and  the  Department 
Committee  for  Employer  shall  each  elect  its  respective  chairman. 

The  secretary  for  the  General  Committees,  or  an  authorized  repre- 
sentative, shall  act  as  secretary  for  the  several  Department  Com- 
mittees, without  vote. 

Meetings 

Stated  meetings  of  each  Department  Committee  shall  be  held  in 
alternate  months  throughout  the  year.  Special  meetings  shall  be  held 
at  the  call  of  the  secretary  or  upon  the  request  of  five  members  sub- 
mitted in  writing  to  the  secretary. 


nil 


Vff 


280       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

No  less  than  two  thirds  of  the  members  of  any  Department  Com- 
mittee shall  constitute  a  quorum  for  the  transaction  of  business  at 
any  regular  or  special  meeting  of  that  committee. 


General  Committees 

The  members  of  each  Department  Committee  for  Employees  shall 
annually  elect  two  of  their  number,  the  members  so  elected  to  consti- 
tute the  General  Committee  for  Employees. 

The  members  of  the  General  Committee  for  Employees  shall  be 
equaled  in  number  by  the  Company's  representatives,  to  be  appointed 
by  the  president  of  the  Company,  the  members  so  appointed  to  con- 
stitute the  General  Committee  for  Employer. 

A  vacancy  occurring  in  the  General  Committees  shall  be  filled  as 
promptly  as  possible  in  the  manner  of  the  original  choosing. 

It  shall  be  the  duty  of  the  General  Committees  to  devise  ways  and 
means  for  furthering  the  efforts  of  the  various  Department  Com- 
mittees for  the  greatest  possible  good,  to  promote  harmony  and  good 
fellowship  among  all  employees  of  the  Company,  to  formulate  plans 
for  submission  to  the  several  Department  Committees,  and  to  render 
every  assistance  within  their  power  toward  advancement  of  the  in- 
terests of  the  employees  and  the  betterment  of  the  service. 

Further,  the  General  Committees  shall  possess  the  power  to  review, 
modify,  or  reverse  any  findings  or  decision  of  the  Department  Com- 
mittees, and  may,  in  their  judgment,  change  any  portion  of  this  plan 
or  any  modification  thereof  or  the  composition  of  any  of  the  com- 
mittees, or  any  of  their  various  respective  functions. 

The  scope  and  authority  of  the  General  Committees  shall  be  su- 
perior to  that  of  the  Department  Committees,  and  their  decisions  in 
all  matters  shall  be  final  and  binding,  except  as  hereinafter  provided. 

Officers 

The  General  Committee  for  Employees  and  the  General  Committee 
for  Employer  shall  each  elect  its  respective  chairman.  The  secretary 
for  the  General  Committees  shall  be  appointed  by  the  president  of 
the  Company,  and  shall  not  be  entitled  to  vote.  It  shall  be  the 
duty  of  the  secretary  to  keep  accurate  minutes  of  meetings  of  all 


PLAN  FOR  COLLECTIVE  BARGAINING 


281 


committees.  For  this  purpose  an  assistant  secretary  shall  be  em- 
ployed to  assist  in  keeping  the  minutes  and  conducting  the  details 
of  the  several  committees. 

Meetings 

Stated  meetings  of  the  General  Committees  shall  be  held  on  the 
third  Tuesday  of  each  month. 

Special  meetings  shall  be  held  at  the  request  of  the  chairman  of 
either  of   the  General   Committees,   submitted   in   writing   to   the 

secretary. 

No  less  than  two  thirds  of  the  members  of  each  General  Committee 
shall  constitute  a  quorum  for  the  transaction  of  business  at  any 
regular  or  special  meeting. 

Board  of  Arbitration 

If  resort  to  arbitration  becomes  necessary,  then  there  shall  be 
an  arbitrator  chosen  by  the  General  Committee  for  Employees  and 
an  arbitrator  chosen  by  the  General  Committee  for  Employer,  the 
two  arbitrators  so  chosen  to  select  a  third  arbitrator.  Failing  unan- 
imous decision,  the  decision  of  any  two  of  these  arbitrators  shall 

be  binding. 

In  the  event  that  the  arbitrator  chosen  by  the  General  Committee 
for  Employees  and  the  arbitrator  chosen  by  the  General  Committee 
for  Employer  are  unable  to  agree  upon  a  third  arbitrator,  then  the 
provost  of  the  University  of  Pennsylvania,  the  chairman  of  the 
Public-Service  Commission,  and  the  president  of  the  Chamber  of 
Commerce  shall  be  requested  to  serve  as  additional  arbitrators,  or, 
failing  so  to  do,  to  appoint  their  own  personal  representatives  to  act 
as  such  additional  arbitrators.  Failing  unanimous  decision,  the 
decision  of  any  three  of  these  five  arbitrators  shall  be  binding. 

Compensation 

The  pay  of  members  of  the  General  Committee  for  Employees  and 
of  all  Department  Committees  for  Employees  while  employed  on 
committee  work  shall  be  paid  from  the  funds  of  the  Cooperative 
Welfare  Association  and  shall  be  at  the  rate  received  by  the  respec- 
tive employees  at  their  regular  occupations,  and  while  so  employed 
they  shall  receive  no  pay  from  the  Company. 


'li 


!fj 


4 


282        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  members  of  the  General  Committee  for  Employer  and  of  all 
Department  Committees  for  Employer  shall  receive  no  compensation 
from  the  Association  for  their  services  as  Committeemen,  but  shall 
receive  from  the  Company  the  continuation  of  their  regular  pay  as 
Company  employees. 

Each  arbitrator  shall  be  paid  from  the  funds  of  the  Cooperative 
Welfare  Association,  as  compensation  for  his  services,  an  amount  to 
be  determined  by  the  General  Committees. 

All  expenses  of  any  character  incident  to  the  carrying  out  of  the 
Cooperative  Plan  shall  be  paid  out  of  the  funds  of  the  Cooperative 
Welfare  Association— the  same  being  represented  in  the  amount  of 
the  dues  as  paid  in  from  time  to  time  by  the  members  of  the  Coopera- 
tive Welfare  Association  and  in  the  sum  of  $10,000  per  month  paid 
in  by  the  Company. 


COOPERATIVE  WELFARE 

Membership 

Membership  in  the  Cooperative  Welfare  Association  is  open  to  em- 
ployees one  year  or  over  in  service  and  over  sixteen  years  of  age, 
without  initiation  fee ;  $1  per  month  will  be  deducted  from  the  pay 
of  each  member,  and  said  dues  will  entitle  members  to  life  insurance, 
sick  benefits  and  pensions,  as  herein  provided. 

The  Company  during  the  period  of  this  management  has  paid  into 
the  various  funds  representing  sick  benefits,  pensions,  death  benefits, 
and  other  benefactions,  at  the  rate  of  approximately  $90,000  per 
annum.  Under  the  Cooperative  Plan  of  19 18  the  Company  will 
contribute  a  lump  sum  of  $10,000  per  month  to  the  cost  of  carrying 
out  the  conditions  contained  therein. 

Should  the  income  realized  by  the  payment  of  $1  per  month  by 
members  and  $10,000  per  month  by  the  Company  be  found  insuffi- 
cient to  meet  the  expenditures  of  the  Association,  the  dues  of  mem- 
bers shall  be  increased  sufficiently  to  prevent  a  deficit  in  the  funds  of 
the  Association,  and  no  increase  in  the  amount  paid  by  the  Company 
shall  be  made  until  the  total  amount  paid  monthly  by  the  members 
equals  the  $10,000  paid  monthly  by  the  Company.  Thereafter  all 
increases  shall  be  borne  equally  by  both.    The  Company,  however 


PLAN  FOR  COLLECTIVE  BARGAINING 


283 


will  not  reduce  its  minimum  payment  of  $10,000  per  month  should 
the  present  dues  of  $1  per  month  create  a  surplus  in  the  funds  of 
the  Association. 

Life  Insurance 

A  blanket  policy  has  been  issued  by  the  Metropolitan  Life  Insur- 
ance Company,  insuring  the  lives  of  employees  of  the  Company  desir- 
ing to  avail  themselves  of  this  protection  through  the  medium  of  the 
Cooperative  Welfare  Association. 

Certificates  of  Insurance  providing  for  $1000  life  insurance  have 
been  delivered  into  the  possession  of  each  member  of  the  Association, 
to  remain  in  full  force  and  effect  so  long  as  the  member  continues  in 
the  employ  of  the  Company  and  retains  membership  in  the  Cooper- 
ative Welfare  Association. 

This  replaces  the  death  benefit  of  $150  formerly  paid  under  the 
Cooperative  Plan  of  19 11,  to  which  the  members  contributed  25  cents 
per  month,  and  also  replaces  the  S500  given  by  the  Company  to 
dependents  of  deceased  employees  who  had  been  over  two  years  in 

its  service. 

The  Metropolitan  Life  Insurance  Company  makes  payment  of 
benefits  and  insurance  under  its  policy  direct  to  the  beneficiaries  of 
the  members  of  the  Cooperative  Welfare  Association. 

Each  Certificate  of  Insurance  for  $1000  issued  by  the  Metropolitan 
Life  Insurance  Company,  under  the  provisions  of  the  blanket  policy, 
entitles  the  holder,  upon  leaving  the  employ  of  the  Company,  to  re- 
insure for  the  same  amount  with  the  Insurance  Company  without 
medical  examination,  at  rates  based  upon  the  member's  then  attained 
age.  Any  such  member  subsequently  returning  to  the  employ  will 
again  become  eligible  for  reinsurance  under  the  provisions  of  this 
blanket  policy. 

A  special  feature  of  this  Certificate  of  Insurance  is  a  provision 
that  in  case  of  total  and  permanent  disability,  occurring  before  the 
member  shall  have  attained  sixty  years  of  age,  from  causes  arising 
after  the  issuance  of  insurance,  the  insured  will  be  entitled  to  receive 
from  the  Insurance  Company  the  $1000  covered  by  the  policy  in 
monthly  or  yearly  installments,  as  set  forth  in  the  Certificate  of  In- 
surance for  $1000  now  in  the  possession  of  each  member  of  the 
Association. 


1:i 


ill 


.:i 


284       TRADE  UNIOxXISM  AND  LABOR  PROBLEMS 

Sick  Benefits 

Sick  benefits  are  payable  at  the  rate  of  $1.50  per  day,  commencing 
with  the  eighth  day's  illness,  for  a  period  not  to  exceed  one  hundred 
days  in  any  consecutive  twelve  months. 

This  replaces  the  former  sick  relief  of  $1  per  day  for  one  hundred 
days  in  any  consecutive  twelve  months. 

Pensions 

Pensions  of  S40  per  month  are  payable  to  incapacitated  employees 
who  have  reached  sixty-five  years  of  age  and  have  been  continuously 
in  the  service  for  twenty-five  years ;  meritorious  cases  of  long  serv- 
ice, but  falling  short  of  these  requirements,  to  be  given  special 
consideration. 

This  increases  the  former  pension  plan  from  $20  to  $40  per  month. 

Administration 

The  affairs  of  the  Cooperative  Welfare  Association  shall  be  ad- 
ministered by  a  Cooperative  Council  consisting  of  the  combined 
membership  of  the  two  General  Committees  for  collective  bargaining. 
The  administration  of  the  Cooperative  Welfare  Association  shall 
be  entirely  separate  and  distinct  from  the  function  of  collective 
bargaining. 

The  Cooperative  Council  shall  act  as  Trustees  of  Insurance  for 
the  Cooperative  Welfare  Association  and  shall  also  authorize  the 
expenditure  of  all  moneys,  including  payment  of  sick  benefits. 

The  Cooperative  Council  shall  also  pass  upon  the  issuance  of  In- 
surance Certificates  and  the  validity  and  merit  of  all  applicants  for 
pensions. 

The  president  of  the  Cooperative  Welfare  Association,  who  shall 
also  act  as  chairman  of  the  Cooperative  Council,  shall  be  elected  an- 
nually from  the  membership  of  the  Association  by  the  majority 
vote  of  all  the  members  of  the  several  Department  Committees  for 
Employees. 

The  chairman  of  the  Board  of  Directors  and  the  president  of 
the  Company  shall  be  the  honorary  chairmen  of  the  Cooperative 
Council. 


PLAN  FOR  COLLECTIVE  BARGAINING 


28s 


THE  COMPANY 


THE  EMPLOYER 


THE  employee! 


BRANCH 
COMMITTEES 


BRANCH 
COMMITTEES 


DEPARTMENT 
COMMITTEES 


DEPARTMENT 
COMMITTEES 


GENERAL 
COMMITTEE 


GENERAL 
COMMITTEE 


COOPERATIVE  COUNCIL 

COOPERATIVE 
WELFARE  ASSOCIATION 


ARBITRATOR 


ARBITRATION 
THROUGH  THE  PUBLIC 


PROVOST 
I  yNIVHRSftY  OF  PtNNSYLVANIA 
REPRESENTING 

EDUCATION 


CHAIRMAN 

PUBUC  SERVICE  COMMISSION 

REPRESENTING 

SERVICE 


PRESIDENT 

CHAMBER  OF  COMMERCE 

REPRESENTING 

COMMERCE 


Chart  showing  Organization 

The  secretary-treasurer  of  the  Cooperative  Council  and  the  as- 
sistant secretary-treasurer  shall  be  appointed  by  the  president  of  the 
Company.  The  Association  shall  employ  such  other  assistants  as 
may  be  required. 

The  Company's  Auditing  and  Treasury  Departments  are  to  be 
placed  at  the  disposal  of  the  Cooperative  Council  for  the  purpose  of 
keeping  the  accounts  and  safeguarding  the  funds  of  the  Cooperative 
Welfare  Association. 


I 


Iftttl 


286       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

COOPERATIVE  PLAN  ADOPTED 

On  August  19,  1918,  a  personal  letter  signed  by  President  Mitten 
and  approved  by  Mr.  Stotesbury  was  mailed  to  each  employee  of  the 
Company,  together  with  a  booklet  containing  the  provisions  of  the 
amended  Cooperative  Plan  (which  included  life  insurance,  sick  bene- 
fits, pensions,  wages,  and  representation  through  the  duly  elected 
committees),  as  well  as  a  card  whereon  employees  so  desiring  were 
invited  to  express  their  approval  of  the  same. 

The  response  of  the  employees  was  prompt  and  general  and 
showed  such  an  overwhelming  majority  in  favor  of  the  amended  plan 
as  to  insure  its  immediate  success.  A  second  letter  was  therefore 
mailed  on  August  27  to  all  eligible  employees,  one  year  in  the  service, 
inclosing  an  official  application  card  for  membership  in  the  Associa- 
tion which  provided  for  certain  information  required  by  the  Insurance 
Company  not  contained  in  the  original  card. 

The  letter  explained  that  a  contract  had  been  entered  into  with 
the  i\Ietro[)olitan  Life  Insurance  Company  insuring  for  Si 000  the 
lives  of  all  who  became  members  of  the  Association,  and  also  de- 
scribed the  various  conditions  governing  the  issuance  of  the  Certifi- 
cates of  Insurance. 

A  further  letter  was  sent  to  all  eligible  employees  on  September  6, 
setting  forth  that  under  the  terms  of  the  contract  with  the  Metro- 
politan Life  Insurance  Company  the  insurance  on  employees  who 
mailed  their  application  cards  before  midnight  September  15  would 
become  effective  when  the  card  was  mailed  ;  that  insurance  on  em- 
ployees who  mailed  their  application  cards  after  midnight  September 
15  and  up  to  midnight  September  30  would  become  effective  when 
the  Certificate  was  issued,  and  that  any  eligible  employee  who  failed 
to  mail  his  application  card  before  midnight  September  30  would 
not  be  insurable  unless  able  to  perform  the  duties  of  his  or  her 
position. 

All  of  these  communications  were  mailed  to  the  homes  of  the 
employees,  so  that  they  could  be  carefully  considered  by  the  em- 
ployees and  the  members  of  their  families. 

At  December  i,  1918,  there  were  9073  employees  eligible  for  mem- 
bership in  the  new  Cooperative  Welfare  Association,  of  which  num- 
ber the  applications  of  8399,  or  over  92  per  cent  are  on  file.    The 


PLAN  FOR  COLLECTIVE  BARGAINING  287 

deaths,  owing  to  the  ravages  of  the  epidemic  influenza,  have  been 
unusually  large,  and  this,  together  with  the  withdrawals  from  service, 
have  reduced  the  total  by  267,  leaving  a  net  membership,  as  of 
December  i,  of  8132. 

The  applications  for  continued  membership  very  generally  bear 
the  indorsement  of  the  wife,  who,  in  most  instances,  is  named  as  the 
beneficiary.  The  following  statement  of  beneficiaries  named  in  the 
Certificates  of  Insurance  as  being  entitled  to  receive  the  $1000  death 
benefit  is  of  interest : 

Total       Per  Cent 
Number      of  Total 

Wife  and  Children 6459  80  % 

Parents ^^i  10 

Other  Relatives 5^8  7 

Estate,  etc ^^4           3 

Total 8132  100 

Following  the  overwhelming  indorsement  of  the  plan  by  the  em- 
ployees of  the  Company,  as  evidenced  by  their  applications  for  mem- 
bership in  the  new  Cooperative  Welfare  Association,  the  General 
Committee,  through  its  chairman  and  secretary,  on  October  21,  1918, 
mailed  to  all  employees  a  letter  outlining  the  progress  of  the  welfare 
work  and  declaring  the  Cooperative  Plan  of  1918  operative  and  in 
full  effect  as  of  that  date. 


IpBw 


XXII 

WORKSHOP  COMMITTEES^ 

SOME  time  ago  I  was  asked  to  prepare  a  memorandum  on  the 
subject  of  workshop  committees,  for  presentation  to  the  British 
Association,  as  a  part  of  the  report  of  a  special  subcommittee  study- 
ing industrial  unrest.  The  following  pages  contain  the  gist  of  that 
memorandum  and  are  now  issued  in  this  form  for  the  benefit  of  some 
of  those  interested  in  the  problem  who  may  not  see  the  original 
report. 

I  have  approached  the  subject  with  the  conviction  that  the  worker's 
desire  for  more  scope  in  his  working  life  can  best  be  satisfied  by  giv- 
ing him  some  share  in  the  directing  of  it ;  if  not  of  the  work  itself, 
at  least  of  the  conditions  under  which  it  is  carried  out.  I  have  tried, 
therefore,  to  work  out  in  some  detail  the  part  which  organizations  of 
workers  might  play  in  works  administration.  And  believing  as  I  do 
that  the  existing  industrial  system,  with  all  its  faults  and  injustices, 
must  still  form  the  basis  of  any  future  system,  I  am  concerned  to 
show  that  a  considerable  development  of  joint  action  between  man- 
agement and  workers  is  possible,  even  under  present  conditions. 

Many  of  the  ideas  put  forward  are  already  incorporated  to  a 
greater  or  lesser  degree  in  the  institutions  of  these  works,  but  these 
notes  are  not  intended,  primarily,  as  an  account  of  our  experiments, 
still  less  as  a  forecast  of  the  future  plans  of  this  firm.  Our  own  ex- 
perience and  hopes  do,  however,  form  the  basis  of  much  here  written, 
and  have  inevitably  influenced  the  general  line  of  thought  followed. 

INTRODUCTION 

Throughout  the  following  notes  it  is  assumed  that  the  need  is 

realized   for  a  new  orientation  of  ideas  with  regard  to  industrial 

management.    It  is  further  assumed  that  the  trend  of  such  ideas  must 

be  in  the  direction  of  a  devolution  of  some  of  the  functions  and 

^Survey,  Vol.  XLI,  1918,  Reconstruction  Series  No.  i. 

288 


WORKSHOP  COMMITTEES 


1 


z'S'g 


responsibilities  of  management  onto  the  workers  themselves  These 
notes  therefore,  are  concerned  mainly  with  considenng  how  far  this 
devolution  can  be  carried  under  present  conditions  and  the  necessary 
machinery  for  enabling  it  to  operate. 

Before  passing,  however,  to  detailed  schemes  it  is  worth  consider- 
ing briefly  what  the  aims  of  this  devolution  are. 

It  must  be  admitted  that  the  conditions  of  industrial  life  fail  to 
satisfy  the  deeper  needs  of  the  workers,  and  that  it  is  this  failure, 
even  more  than  low  wages,  which  is  responsible  for  much  of  their 
general  unrest.  Now  the  satisfaction  to  be  derived  from  work  depends 
upon  its  being  a  means  of  selLfixpre^ion^  This  again  depends  on  the 
power  of  control  exercised  by  the  individual  over  the  materials  and 
processes  used  and  the  conditions  under  which  the  work  is  carried 
out  or  in  the  case  of  complicated  operations  (where  the  individual 
can  hardly  be  other  than  a  "  cog  in  the  machine")  on  the  willingness, 
uriderstanding,  and  imagination  with  which  he  undertakes  such  a 
role    In  the  past  the  movement  in  industry  in  this  respect  has  been 
all  in  the  wrong  direction  ;  namely,  a  continual  reduction  of  freedom, 
initiative,  and  interest,  involving  an  accentuation  of  the  "cog-in-the- 
machine"  status.   Moreover,  it  has  too  often  produced  a     cog 
blind  and  unwilling,  with  no  perspective  or  understanding  of  the 
part  it  plays  in  the  general  mechanism  of  production  or  even  in  any 
one  particular  series  of  operations. 

Each  successive  step  in  the  splitting  up  and  specializing  of  oper- 
ations has  been  taken  with  a  view  to  promoting  efficiency  of  pro- 
duction, and  there  can  be  no  doubt  that  efficiency,  in  a  material 
sense  has  been  achieved  thereby  and  the  productivity  of  industry 
greatly  increased.  This  has  been  done,  however,  at  the  cost  of 
pleasure  and  interest  in  work,  and  the  problem  now  is  how  far  these 
could  be  restored,  as,  for  instance,  by  some  devolution  of  manage- 
ment responsibility  onto  the  workers,  and  how  far  such  devolution  is 
possible  under  the  competitive  capitalist  system,  which  is  likely  to 
dominate  industry  for  many  long  years  to  come. 

Under  the  conditions  of  capitalist  industry  any  scheme  of  devolu- 
tion of  management  can  only  stand  provided  it  involves  no  net  loss 
of  productive  efficiency.  It  is  believed,  however,  that  even  within 
these  limits  considerable  progress  in  this  direction  is  possible,  doubt- 
less involving  some  detail  loss,  but  with  more  than  compensating 


\ 


■f 


m 


fii 


290       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

gains  in  general  efficiency.  In  this  connection  it  must  be  remembered 
that  the  work  of  very  many  men,  probably  of  most,  is  given  more  or 
less  unwillingly,  and  even  should  the  introduction  of  more  democratic 
methods  of  business  management  entail  a  certain  amount  of  loss  of 
mechanical  efficiency,  due  to  the  greater  cumbersomeness  of  demo- 
cratic proceedings,  if  it  can  succeed  in  obtaining  more  willing  work 
and  cooperation,  the  net  gain  in  productivity  would  be  enormous. 

Important  and  urgent  as  is  this  problem  of  rearranging  the  ma- 
chinery of  management  to  enable  responsibility  and  power  to  be 
shared  with  the  workers,  another  and  preliminary  step  is  even  more 
pressing.  This  is  the  establishing  of  touch  and  understanding  be- 
tween employer  and  employed,  between  management  and  worker. 
Quite  apart  from  the  many  real  grievances  under  which  workers 
in  various  trades  are  suffering  at  the  present  time,  there  is  a  vast 
amount  of  bad  feeling,  due  to  misunderstanding,  on  the  part  of  each 
side,  of  the  aims  and  motives  of  the  other.  Each  party,  believing 
the  other  to  be  always  ready  to  play  foul,  finds  in  every  move  easy 
evidence  to  support  its  bitterest  suspicions.  The  workers  are  irri- 
tated beyond  measure  by  the  inefficiency  and  blundering  in  organiza- 
tion and  management  which  they  detect  on  every  side,  and  knowing 
nothing  of  business  management  cannot  understand  or  make  allow- 
ance for  the  enormous  difficulties  under  which  employers  labor  at 
the  present  time.  Similarly,  employers  are  too  ignorant  of  trade- 
unions  affairs  to  appreciate  the  problems  which  the  present  "light- 
ning transformation''  of  industry  present  to  those  responsible  for 
shaping  trade-union  policy ;  nor  is  the  employer  generally  in  close 
enough  human  touch  to  realize  the  effect  of  the  long  strain  of  war 
work  and  of  the  harassing  restrictions  of  personal  liberty. 

More  important,  therefore,  than  any  reconstruction  of  manage- 
'  ment  machinery,  more  important  even  than  the  remedying  of  specific 
grievances,  is  the  establishing  of  some  degree  of  ordinary  human 
touch  and  sympathy  between  management  and  men. 

This  also  has  an  important  bearing~on  any^disclKsion  with  regard 
to  developing  machinery  for  joint  action.  It  cannot  be  empha- 
sized too  strongly  that  the  hopefulness  of  any  such  attempt  lies  not 
in  the  perfection  of  the  machinery,  nor  even  in  the  wideness  of  the 
powers  of  self-government  granted  to  the  workers,  but  in  the  degree 
to  which  touch  and,  if  possible,  friendliness  can  be  established.    It 


WORKSHOP  COMMITTEES 


291 


should  be  realized,  for  instance,  by  employers  that  time  spent  on 
discussing  and  ventilating  alleged  grievances  which  turn  out  to  be 
no  grievances  may  be  quite  as  productive  of  understanding  and 
good  feeling  as  the  removal  of  real  grievances. 

Passing  now  to  constructive  proposals  for  devolution  of  manage- 
ment, the  subject  is  here  dealt  with  mainly  in  two  stages. 

Under  Section  I  some  of  the  functions  of  management  which  most 
concern  the  workers  are  considered  with  a  view  to  seeing  how  far 
the  autocratic  (or  bureaucratic)  secrecy  and  exclusiveness  which 
usually  surround  business  management,  as  far  as  workers  are  con- 
cerned, is  really  unavoidable  or  how  far  it  could  be  replaced  by 
democratic  discussion  and  joint  action.  The  conclusion  is  that  there 
is  no  reason  inherent  in  the  nature  of  the  questions  themselves  why 
this  cannot  be  done  to  a  very  considerable  extent. 

Section  II  deals  with  the  second  stage  referred  to  and  considers 
the  machinery  needed  to  make  such  joint  action  as  is  suggested  in 
Section  I  workable — a  very  different  matter  from  admitting  that 
in  itself  it  is  not  impossible!  The  apparent  complication  of  such 
machinery  is  doubtless  a  difficulty,  but  it  is  not  insuperable  and  is 
in  practice  less  formidable  than  it  seems  at  first  sight.  It  must  be 
realized,  however,  that  the  degree  of  elaboration  of  the  machinery  for 
joint  working  adopted  by  any  particular  industry  or  firm  must  be 
in  relation  to  the  elaboration  of  the  existing  management  system. 
It  would  be  quite  impossible  for  many  of  the  refinements  of  dis- 
cussion and  joint  action  suggested  to  be  adopted  by  a  firm  whose 
ordinary  business  organization  was  crude,  undeveloped,  and  un- 
systematic.   This  point  is  more  fully  dealt  with  in  this  section. 

Section  III  contains  a  summary  of  the  scheme  of  committees  con- 
tained in  Section  II,  showing  the  distribution  to  each  committee  of 
the  various  questions  discussed  in  Section  I. 

SECTION  I.    SCOPE  OF  WORKERS'  SHOP  ORGANIZATIONS; 
MANAGEMENT  QUESTIONS  WHICH  COULD  BE  DEVOLVED, 

WHOLLY  OR  IN  PART 
It  is  proposed  in  this  section  to  consider  the  activities  which  or- 
ganizations of  workers  within  the  workshop  might  undertake  without 
any  radical  reorganization  of  industry.   What  functions  and  powers, 
usually  exercised  by  the  management,  could  be  devolved  onto  the 


^ 


I 


3 


I 


iM 


292       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

workers,  and  what  questions,  usually  considered  private  by  the  man- 
agement, could  be  made  the  subject  of  explanation  and  consultation  ? 
The  number  of  such  questions,  as  set  out  in  this  section,  may  appear 
very  formidable,  and  is  possibly  too  great  to  be  dealt  with  except  by 
a  very  gradual  process.  No  thought  is  given  at  this  stage,  however, 
to  the  machinery  which  would  be  necessary  for  achieving  so  much 
joint  working,  the  subject  being  considered  rather  with  a  view  to  see- 
ing how  far,  and  in  what  directions,  the  inherent  nature  of  the  ques- 
tions themselves  would  make  it  possible  or  advisable  to  break  down 
the  censorship  and  secrecy  which  surround  business  management. 

In  the  list  which  follows,  obviously  not  all  questions  are  of  equal 
urgency,  those  being  most  important  which  provide  means  of  consul- 
tation and  conciliation  in  regard  to  such  matters  as  most  frequently 
give  rise  to  disputes ;  namely,  wage  and  piece-rate  questions  and,  to 
a  lesser  degree,  workshop  practices  and  customs.  Any  scheme  of 
joint  working  should  begin  with  these  matters,  the  others  being  taken 
over  as  the  machinery  settles  down  and  it  is  found  practicable  to 
do  so.  How  far  any  particular  business  can  go  will  depend  on  the 
circumstances  of  the  trade  and  on  the  type  of  organization  in 
operation. 

Though  machinery  for  conciliation  in  connection  with  existing 
troubles,  such  as  those  mentioned,  must  be  the  first  care,  some  of 
the  other  matters  suggested  in  this  section — for  example,  safety  and 
hj^giene,  shop  amenities,  etc. — should  be  dealt  with  at  the  earliest 
possible  moment.  Such  subjects,  being  less  controversial,  offer  an 
easier  means  of  approach  for  establishing  touch  and  understanding 
between  managers  and  men. 

The  suggestions  in  this  section  are  divided  into  two  main  groups, 
but  this  division  is  rather  a  matter  of  convenience  than  an  indication 
of  any  vital  difference  in  nature.  The  suggestions  are  arranged  in 
order  of  urgency,  those  coming  first  where  the  case  for  establishing 
a  workers'  shop  organization  is  so  clear  as  to  amount  to  a  right,  and 
passing  gradually  to  those  where  the  case  is  more  and  more  question- 
able. The  first  group,  therefore,  contains  all  those  items  where  the 
case  is  clearest  and  in  connection  with  which  the  immediate  benefits 
would  fall  to  the  workers.  The  second  group  contains  the  more  ques- 
tionable items,  which  lie  beyond  the  region  where  the  shoe  actually 
pinches  the  worker.    These  questions  are  largely  educational,  and  the 


WORKSHOP  COMMITTEES 


293 


immediate  benefit  of  action,  considered  as  a  business  proposition, 
would  accrue  to  the  management  through  the  greater  understanding 
of  management  and  business  difiiculties  on  the  part  of  the  workers. 

Questions  in  Connection  with  which  Shop  Organizations 

WOULD  primarily  BENEFIT   THE  WORKERS 

This  group  deals  with  those  matters  where  the  case  for  establishing 
shop  organizations,  to  meet  the  need  of  the  workers,  is  clearest. 

I.  Collective  bargaining.  There  is  a  need  for  machinery  for 
carryingTHis  funcHDn  of  the  trade-union  into  greater  and  more  inti- 
mate workshop  detail  than  is  possible  by  any  outside  body.  A 
workshop  organization  might  supplement  the  ordinary  trade-union 
activities  In  the  foUuwmg  directions :  '^     ^  ^^ 

a.  Wages 

(Note.  General  standard  rates  would  be  fixed  by  negotiation 
with  the  trade-union  for  an  entire  district,  not  by  committees 
of  workers  in  individual  works.) 

To  insure  the  application  of  standard  rates  to  individuals,  to 
see  that  they  get  the  benefit  of  the  trade-union  agreements. 

When  a  scale  of  wages,  instead  of  a  single  rate,  applies  to  a 
class  of  work  (the  exact  figure  varying  according  to  the  ex- 
perience, length  of  service,  etc.,  of  the  worker),  to  see  that 
such  scales  are  applied  fairly. 

To  see  that  promises  of  advances  (such  as  those  made,  for  in- 
stance, at  the  time  of  engagement)  are  fulfilled. 

To  see  that  apprentices,  on  completing  their  time,  are  raised  to 
the  standard  rate  by  the  customary  or  agreed  steps. 

b.  Piecework  Rates 
IS  assumed  that  the  general  method  of  rate-fixing — for 

example,  the  adoption  of  time  study  or  other  method — would 
be  settled  with  the  local  trade-unions.) 

To  discuss  with  the  management  the  detailed  methods  of  rate- 
fixing,  as  applied  either  to  individual  jobs  or  to  particular 
classes  of  work. 

Wliere  there  is  an  agreed  relation  between  time  rates  and  piece 
rates  as,  for  instance,  in  engineering  to  see  that  individual 
piece  rates  are  so  set  as  to  yield  the  standard  rate  of  earning. 

To  discuss  with  the  management  reduction  of  piece  rates  where 
these  can  be  shown  to  yield  higher  earnings  than  the  standard. 


si 


V 


df'S 


^1! 


<« 


294       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

To  investigate  on  behalf  of  the  workers  complaints  as  to  in- 
ability to  earn  the  standard  rate.  For  this  purpose  all  the 
data  and  calculations,  both  with  regard  to  the  original  setting 
of  the  rate  and  with  regard  to  time-booking  on  a  particular 
job,  would  have  to  be  open  for  examination. 

(Note.  It  is  doubtful  whether  a  shop  committee,  on  account  of 
its  cumbersomeness,  could  ever  handle  detail,  individual  rates, 
except  where  the  jobs  dealt  with  are  so  large  or  so  standard- 
ized as  to  make  the  number  of  rates  to  be  set  per  week 
quite  small.  A  better  plan  would  be  for  a  representative 
of  the  workers,  preferably  paid  by  them,  to  be  attached 
to  the  rate-fixing  department  of  a  works,  to  check  all  cal- 
culations and  to  look  after  the  workers'  interests  generally. 
He  would  report  to  a  shop  committee,  whose  discussions 
with  the  management  would  then  be  limited  to  questions 
of  principle.) 

c.  Watching   the   Application   of   Special   Legislation,   Awards,   or 

Agreements ;  for  example, 

Munitions-of-war  act,  dilution,  leaving-certificates,   etc. 

Recruiting,  exemptions. 

After-war  arrangements,  demobilization  of  war  industries,  res- 
toration of  trade-union  conditions,  etc. 

d.  Total  Hours  of  Work 

To  discuss  any  proposed  change  in  the  length  of  the  standard 
week.  This  could  only  be  done  by  the  workers'  committee 
of  an  individual  firm,  provided  the  change  were  within  the 
standards  fixed  by  agreement  with  the  local  union  or  those 
customary  in  the  trade. 

e.  New  Processes  or  Change  of  Process 

Where  the  management  desire  to  introduce  some  process  which 
will  throw  men  out  of  employment,  the  whole  position  should 
be  placed  before  a  shop  committee  to  let  the  necessity  be 
understood  and  to  allow  it  to  discuss  how  the  change  may  be 
brought  about  with  the  least  hardship  to  individuals. 
/.  Grades  of  Worker  for  Types  of  Machines 

Due  to  the  introduction  of  new  types  of  machines,  and  to  the 
splitting  up  of  processes,  with  the  simplification  of  manipula- 
tion sometimes  entailed  thereby,  the  question  of  the  grade  of 
worker  to  be  employed  on  a  given  type  of  machine  continually 
arises.  Many  such  questions  are  so  general  as  to  be  the 
subject  of  trade-union  negotiation,  but  many  more  are  quite 
local  to  particular  firms.  For  either  kind  there  should  be  a 
works  committee  within  the  works  to  deal  with  their  applica- 
tion there. 


WORKSHOP  COMMITTEES 


295 


2.  Grievances.  The  quick  ventilating  of  grievances  and  injustices 
to  individuals  or  to  classes  of  men  is  of  the  greatest  importance  in 
securing  good  feeling.  The  provision  of  means  for  voicing  such 
complaints  acts  also  as  a  check  to  petty  tyranny  and  is  a  valuable 
help  to  the  higher  management  in  giving  an  insight  into  what  is 

going  on. 

A  shop  committee  provides  a  suitable  channel  in  such  cases  as 

the  following : 

Alleged  petty  tyranny  by  foremen. 

Hard  cases  arising  out  of  too  rigid  application  of  rules,  etc. 

Alleged  mistakes  in  wages  or  piecework  payments. 

Wrongful  dismissal ;  for  example,  for  alleged  disobedience,  etc.,  etc. 

In  all  cases  of  grievances  or  complaints  it  is  most  important  that 
the  body  bringing  them  should  be  of  sufficient  weight  and  standing 
to  speak  its  mind  freely. 

3.  General  sho±s2uditiai2^_md-UmitBli^^  ^^^  ^^^^e  questions 
which~aTfecrtKe  community  life  of  the  factory  the  fullest  consultation 
is  necessary  and  considerable  self-government  is  possible. 

The  following  indicate  the  kind  of  question : 

a.  Shop  Rules 

Restriction  of  smoking. 
Tidiness,  cleaning  of  machines,  etc. 
Use  of  lavatories  and  cloakrooms. 
Provision,  care,  and  t\pe  of  overalls. 
Time-booking  arrangements. 
Wage-paying  arrangements,  etc.,  etc. 

b.  Maintenance  of  Discipline 

It  should  be  possible  to  promote  such  a  spirit  in  a  works  that 
not  only  could  the  workers  have  a  say  in  the  drawing  up  of 
shop  rules,  but  the  enforcing  of  them  could  also  be  largely 
in  their  hands.  This  would  be  particularly  desirable  with 
regard  to 

Enforcing  good  timekeeping. 

Maintaining  tidiness. 

Use  of  lavatories  and  cloakrooms. 

Promoting  a  high  standard  of  general  behavior,  etc.,  etc. 

c.  Working  Conditions 

Meal  hours,  starting  and  stopping  times. 
Arrangements  for  holidays,  etc. 
Arrangement  of  shifts,  night  work,  etc. 


j: 


m 


296       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

d.  Accidents  and  Sickness 

Safety  appliances  and  practices. 
Machine  guards,  etc. 
Administration  of  first  aid. 
Rest-room  arrangements. 
Medical  examination  and  advice. 

e.  Dining  Service 

Consultation  re  requirements. 
Criticisms  of  and  suggestions  re  service. 
Control  of  discipline  and  behavior. 
Seating  arrangements,  etc. 
/.  Shop  Comfort  and  H)^giene 

Suggestions  re  temperature,  ventilation,  washing  accommoda- 
tion, drying  clothes,  etc. 
Provision  of  seats  at  work,  where  possible. 
Drinking-water  supply. 
g.  Benevolent  Work 

Shop   collections    for   charities   or   hard    cases   among    fellow 

workers. 
Sick  club,  convalescent  home,  etc. 
Saving  societies. 

4.  General  social  amenities.  A  works  tends  to  become  a  center 
of  social  activities  having  no  direct  connection  with  its  work,  for 
example : 

Works  picnics. 

Games ;  for  example,  cricket,  football,  etc. 

Musical  societies. 

Etc.,  etc. 

These  should  all  be  organized  by  committees  of  the  workers  and 
not  by  the  management. 


Questions  on  which  Joint  Discussion  would  primarily  be  of 

Advantage  to  the  Management 

In  this  group  are  those  questions  with  regard  to  which  there  is  no 
demand  put  forward  by  the  workers,  but  where  discussion  and  ex- 
planation on  the  part  of  the  management  would  be  desirable  and 
would  tend  to  ease  some  of  the  difficulties  of  management.  The 
institution  of  works  committees  would  facilitate  discussion  and 
explanation  in  the  following  instances: 


WORKSHOP  COMMITTEES 


297 


1.  fr^f^*-^^^^^'^*^  ^f  mnn^^ement  to  workers.  In  any  case  of  new 
rules  or  new  developments,  or  new  workshop  policy,  there  is  always 
the  greatest  difficulty  in  getting  the  rank  and  file  to  understand  what 
the  management  is  ^'getting  at."  However  well  meaning  the  change 
may  be  as  regards  the  workers,  the  mere  fact  that  it  is  new  and  not 
understood  is  likely  to  lead  to  opposition.  If  the  best  use  is  made  of 
committees  of  workers,  such  changes,  new  developments,  etc.  would 
have  been  discussed  and  explained  to  them,  and  it  is  not  too  much  to 
expect  that  the  members  of  such  committees  would  eventually  spread  a 
more  correct  and  sympathetic  version  of  the  management's  intentions 
among  their  fellow  workers  than  these  could  get  in  any  other  way. 

2.  Education  in  shop  processes  and  trade  technic.  The  knowl- 
edge of  mosTworkers  is  limited  to  the  process  with  which  they  are 
concerned,  and  they  would  have  a  truer  sense  of  industrial  problems 
if  they  understood  better  the  general  technic  of  the  industry  in  which 
they  are  concerned,  and  the  relation  of  their  particular  process  to 
others  in  the  chain  of  manufacture  from  raw  material  to  finished 

article. 

It  is  possible  that  some  of  this  education  should  be  undertaken 
by  technical  schools,  but  their  work  in  this  respect  can  only  be  of 
a  general  nature,  leaving  still  a  field  for  detailed  teaching  which 
could  only  be  undertaken  in  connection  with  an  individual  firm  or  a 
small  group  of  similar  firms.  Such  education  might  well  begin  with 
the  members  of  the  committee  of  workers,  though  if  found  feasible 
it  should  not  stop  there,  but  should  be  made  general  for  the  whole 
works.  Any  such  scheme  should  be  discussed  and  worked  out  in 
conjunction  with  a  committee  of  workers,  in  order  to  obtain  the  best 

from  it. 

3.  Promotion.  It  is  open  to  question  whether  the  filling  of  any 
given  vacan^^^^mild  profitably  be  discussed  between  the  management 
and  the  workers. 

In  connection  with  such  appointments  as  shop  foremen,  where  the 
position  is  filled  by  promoting  a  workman  or  "leading  hand,"  it 
would  at  least  be  advisable  to  announce  the  appointment  to  the 
workers'  committee  before  making  it  generally  known.  It  might  per- 
haps be  possible  to  explain  why  a  particular  choice  had  been  made. 
This  would  be  indicated  fairly  well  by  a  statement  of  the  qualities 
which  the  management  deemed  necessary  for  such  a  post,  thereby 


IP 


298       TRADE  UNIONISM  AND  LABOR  PROBLExMS 

tending  to  head  off  some  of  the  jealous  disappointment  always  in- 
volved in  such  promotions,  especially  where  the  next  in  seniority  is 
not  taken. 

It  has  of  course  been  urged,  generally  by  extremists,  that  work- 
men  should  choose  their  own  foremen  by  election,  but  this  is  not 
considered  practical  politics  at  present,  though  it  may  become  possible 
and  desirable  when  workers  have  had  more  practice  in  the  exercise 
of  self-management  to  the  limited  degree  here  proposed. 
j     One  of  the  difficulties  involved  in  any  general  discussion  of  pro- 
Unotions  is  the  fact  that  there  are  so  many  parties  concerned  and  all 
tfrom  a  different  point  of  view.    For  example,  in  the  appointment  of 
a  foreman  the  workers  are  concerned  as  to  how  far  the  new  man  is 
sympathetic  and  helpful  and  inspiring  to  work  for.    The  other  fore- 
men are  concerned  with  how  far  he  is  their  equal  in  education  and 
technical  attainments,  social  standing,  length  of  service ;  that  is   as 
to  whether  he  would  make  a  good  colleague.    The  manager  is  con- 
cerned, among  other  qualities,  with  his  energy,  loyalty  to  the  firm 
and  ability  to  maintain  discipline.  Each  of  these  three  parties  is  look- 
ing for  three  different  sets  of  qualities,  and  it  is  not  often  that  a  candi- 
date can  be  found  to  satisfy  all.    Whose  views,  then,  should  carry 
most  weight-the  men's,  the  other  foremen's,  or  the  manager's? 
It  IS  quite  certain,  however,  that  it  is  well  worth  while  making 
some  attempt  to  secure  popular  understanding  and  approval  of  ap- 
pointments made,  and  a  worker's  committee  offers  the  best  oppor- 
tunity for  this. 

It  would  be  possible  to  discuss  a  vacancy  occurring  in  any  grade 
with  all  the  others  in  that  grade.  For  example,  to  discuss  with  all 
shop  foremen  the  possible  candidates  to  fill  a  vacancy  among  the 
foremen.  This  is  probably  better  than  no  discussion  at  all,  and  the 
foremen  might  be  expected,  to  some  extent,  to  reflect  the  feeling 
among  their  men.  Here,  again,  the  establishing  of  any  such  scheme 
might  well  be  discussed  with  the  committee  of  workers. 

4.  Educaiionjnj^emral  business  questiojis.  This  point  is  still 
more  doubtful  than  the  precedmg.  Employers  continually  complain 
that  the  workers  do  not  understand  the  responsibilities  and  the  risks 
which  they,  as  employers,  have  to  carry,  and  it  would  seem  desirable 
therefore,  to  take  some  steps  to  enable  them  to  do  so.  In  some 
directions  this  would  be  quite  feasible ;  for  example, 


P! 


WORKSHOP  COMMITTEES 


299 


1.  The  reasons  should  be  explained  and  discussed  for  the  establish- 

ment of  new  works  departments,  or  the  reorganization  of 
existing  ones,  the  relation  of  the  new  arrangement  to  the 
general  manufacturing  policy  being  demonstrated. 

2.  Some  kind  of  simplified  works  statistics  might  be  laid  before  a 

committee  of  workers ;  for  example, 
Output. 

Cost  of  new  equipment  installed. 
Cost  of  tools  used  in  given  period. 
Cost  of  raw  material  consumed. 
Number  employed. 
Amount  of  bad  work  produced. 

3.  Reports  of  activities  of  other  parts  of  the  business  might  be  laid 

before  them. 

(i)  From  the  commercial  side,  showing  the  difficulties  to  be 
met,  the  general  attitude  of  customers  to  the  firm,  etc. 

(2)  By  the  chief  technical  departments,  design  office,  labora- 
tory, etc.,  as  to  the  general  technical  developments  or  diffi- 
culties that  were  being  dealt  with.  Much  of  such  work  need 
not  be  kept  secret  and  would  tend  to  show  the  workers  that 
other  factors  enter  into  the  production  of  economic  wealth 
besides  manual  labor. 

4.  Simple  business  reports,  showing  general  trade  prospects,  might 

be  presented.  These  are  perhaps  most  difficult  to  give,  in  any 
intelligible  form,  without  publishing  matter  which  every 
management  would  object  to  showing.  Still,  the  attempt 
would  be  well  worth  making  and  would  show  the  workers 
how  narrow  is  the  margin  between  financial  success  and 
failure  on  which  most  manufacturing  businesses  work.  Such 
statistics  might,  perhaps,  be  expressed  not  in  actual  amounts 
but  as  proportions  of  the  wages  bill  for  the  same  period. 

SECTION  II.   TYPES  OF  ORGANIZATION 

Having  dealt  in  the  previous  section  with  the  kinds  of  questions 
which,  judged  simply  by  their  nature,  would  admit  of  joint  discussion 
or  handling,  it  is  now  necessary  to  consider  what  changes  are  needed 
in  the  structure  of  business  management  to  carry  out  such  proposals. 
The  development  of  the  necessary  machinery  presents  very  consider- 
able difficulties  on  account  of  the  slowness  of  action  and  lack  of 
executive  precision  which  almost  necessarily  accompany  democratic 
organization  and  which  it  is  the  express  object  of  most  business 
organizations  to  avoid. 


h. 

1 

1 

1  1 

■* 

300       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  question  of  machinery  for  joint  discussion  and  action  is  con- 
sidered in  this  section  in  three  aspects : 

/   I.  The  requirements  which  such  machinery  must  satisfy. 
\    2.  The  influence  of  various  industrial  conditions  on  the  type  of  ma- 
i  chinery  likely  to  be  adopted  in  particular  trades  or  works. 

\3.  Some  detailed  suggestions  of  shop  committees  of  varying  scope. 

Requirements  to  be  Satisfied 

i._  Keeping  in  touch  with  the  trade-unions.  It  is  obvious  that  no 
works  committee  can  be  a  subsTitiife'Tor  the  trade-union,  and  no 
attempt  must  be  made  by  the  employer  to  use  it  in  this  way.  To 
allay  any  trade-union  suspicion  that  this  is  the  intention,  and  to 
insure  that  the  shop  committee  links  up  with  the  trade-union  organi- 
zation, it  would  be  advisable  to  see  that  the  trade-union  is  repre- 
sented in  some  fairly  direct  manner.  This  is  specially  important  for 
any  committee  dealing  with  wages,  piecework,  and  such  other  work- 
ing conditions  as  are  the  usual  subject  of  trade-union  action. 

In  the  other  direction,  it  will  be  necessary  for  the  trade-unionists 
to  develop  some  means  of  working  shop  committees  into  their  scheme 
of  organization ;  otherwise  there  will  be  the  danger  of  a  works  com- 
mittee, able  to  act  more  quickly  through  being  on  the  spot,  usurping 
the  place  of  the  local  district  committee  of  the  trade-unions. 

2.  Representation  of  all  grades.  The  desirability  of  having  all 
grades  of  workers  represented  on  works  committees  is  obvious,  but  it 
is  not  always  easy  to  carry  out,  owing  to  the  complexity  of  the  distri- 
bution of  labor  in  most  works.  Thus,  it  is  quite  common  for  a  single 
department,  say  in  an  engineering  works,  to  contain  several  grades  of 
workers,  from  skilled  tradesmen  to  laborers,  and  possibly  women. 
These  grades  will  belong  to  different  unions,  and  there  may  even  be 
different,  and  perhaps  competing,  unions  represented  in  the  same 
grade.    Many  of  the  workers  also  will  not  be  in  any  union  at  all. 

3.  Touch  with  management.  As  a  large  part  of  the  aim  of  the 
whole  development  is  to  give  the  workers  some  sense  of  management 
problems  and  point  of  view,  it  is  most  desirable  that  meetings  be- 
tween works  committees  and  management  should  be  frequent  and 
regular  and  not  looked  on  merely  as  means  of  investigating  grievances 
or  deadlocks  when  they  arise.  The  works  committee  must  not  be 
an  accidental  excrescence  on  the  management  structure,  but  must 


WORKSHOP  COMMITTEES 


301 


be  worked  into  it  so  as  to  become  an  integral  part,  with  real  and 
necessary  functions. 

4.  Rapidity  of  action.  Delays  in  negotiations  between  employers 
and  labor  are  a  constant  source  of  irritation  to  the  latter.  Every 
effort  should  be  made  to  reduce  them.  Where  this  is  impossible,  due 
to  the  complication  of  the  questions  involved,  the  works  committee 
should  be  given  enough  information  to  convince  it  of  this,  and  that 
the  delay  is  not  a  deliberate  attempt  to  shirk  the  issue. 

On  the  other  hand,  the  desire  to  attain  rapidity  of  action  should 
not  lead  to  haphazard  and  ''scratch"  discussions  or  negotiations. 
These  will  only  result  in  confusion,  owing  to  the  likelihood  that  some 
of  those  who  ought  to  take  part  or  be  consulted  over  each  question 
will  be  left  out  or  have  insufficient  opportunity  for  weighing  up  the 
matter.  The  procedure  for  working  with  or  through  works  com- 
mittees must,  therefore,  be  definite  and  constitutional,  so  that  every- 
one knows  how  to  get  a  grievance  or  suggestion  put  forward  for 
consideration  and  everyone  concerned  will  be  sure  of  receiving  due 
notice  of  the  matter. 

The  procedure  must  not  be  so  rigid,  however,  as  to  preclude 
emergency  negotiations  to  deal  with  sudden  crises. 

Influence  of  Various  Industrial  Conditions  on  the  Type  of 
Organization  of  Shop  Committees 

There  is  no  one  ty^^e  of  shop  committee  that  will  suit  all  conditions. 
Some  industries  can  develop  more  easily  in  one  direction  and  some 
in  another,  and  in  this  subsection  are  pointed  out  some  of  the 
conditions  which  are  likely  to  influence  development. 

I.  Type  of  labor.  The  constitution  of  works  committees,  or  the 
scheme  ot  committees,  which  will  suitably  represent  the  workers  of 
any  particular  factory  will  depend  very  largely  on  the  extent  to 
which  different  trades  and  different  grades  of  workers  are  involved. 

In  the  simplest  kind  of  works,  where  only  one  trade  or  craft  is 
carried  out,  the  workers,  even  though  of  different  degrees  of  skill, 
would  probably  all  be  eligible  for  the  same  trade-union.  In  such  a 
case  a  purely  trade-union  organization,  but  based  of  course  on  works 
departments,  would  meet  most  of  the  requirements  and  would  prob- 
ably, in  fact,  be  already  in  existence. 


.|.- 


302       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  many  works,  however,  at  least  in  the  engineering  industry,  a 
number  of  different  "  trades  "  are  carried  on ;  for  instance,  turning, 
automatic-machine  operating,  blacksmithing,  patternmaking,  foundry 
work,  etc.  Many  of  these  trades  are  represented  by  the  same  trade- 
union,  though  the  interests  of  the  various  sections  are  often  antago- 
nistic ;  for  example,  in  the  case  of  turners  and  automatic-machine 
operators.  Some  of  the  other  trades  mentioned  belong  to  different 
unions  altogether.  In  addition  to  these  "  tradesmen  "  will  be  found 
semiskilled  and  unskilled  laborers.  For  the  most  part  these  will 
belong  to  no  union,  though  a  few  may  belong  to  laboring  unions 
which,  however,  have  no  special  connection  with  the  engineering 
unions.  In  addition  to  all  these  there  may  be  women,  whose  position 
in  relation  to  men's  unions  is  still  uncertain,  and  some  of  whose  in- 
terests will  certainly  be  opposed  to  those  of  some  of  the  men. 

The  best  way  of  representing  all  these  different  groups  will  depend 
on  their  relative  proportion  and  distribution  in  any  given  works. 
Where  women  are  employed  in  any  considerable  numbers  it  will  prob- 
ably be  advisable  for  them  to  be  represented  independently  of  the 
men.    For  the  rest  it  will  probably  be  necessary  to  have  at  least  two 
kinds   of   works   committees:  one    representing    trade-unionists    as 
such,  chosen  for  convenience  by  departments  ;  the  other  representing 
simply  works  departments.    The  first  would  deal  with  wages  and 
the  type  of  question  usually  forming  the  subject  of  discussion  be- 
tween employers  and  trade-unions;   the  other  would  deal  with  all 
other  workshop  conditions.    The  first,  being  based  on  trade-unions, 
would  automatically  take  account  of  distinctions  between  different 
trades  and  different  grades,  whereas  the  second  would  be  dealing  with 
those  questions  in  which  such  distinctions  do  not  matter  very  much. 
^'Ji^MU^Lmdj:£guhjdl^l_oj  employment.    Where  work   is  of 
an  irregular  or  seasonal  nature  and  workers  are  constantly  beincr 
taken  on  and  turned  off,  only  the  very  simplest  kind  of  committee 
of  workers  would  be  possible.    In  such  industries  probably  nothing 
but  a  trade-union  organization  within  the  works  would  be  possible 
This  would  draw  its  strength  from  the  existence  of  the  trade-union 
outside,  which  would,  of  course,  be  largely  independent  of  trade  fluc- 
tuations and  would  be  able  to  reconstitute  the  works  committee  as 
often  as  necessary,  thus  keeping  it  in  existence  even  should  most  of 
the  previous  members  have  been  discharged  through  slackness 


WORKSHOP  COMMITTEES 


303 


p 
it 


3.  mahoratigv  ^1  rnnimsp.mp.nt  oreajiizatimL  The  extent  to  which 
management  functions  can  be  delegated  or  management  questions 
and  policy  be  discussed  with  the  workers  depends  very  largely  on 
the  degree  of  completeness  with  which  the  management  itself  is  or- 
ganized. Where  this  is  haphazard  and  management  consists  of  a 
succession  of  emergencies,  only  autocratic  control  is  possible,  being 
the  only  method  which  is  quick-acting  and  mobile  enough.  There- 
fore, the  better  organized  and  more  constitutional  (in  the  sense  of 
having  known  rules  and  procedures)  the  management  is,  the  more 
possible  is  it  for  policy  to  be  discussed  with  the  workers. 

Some  Schemes  Suggested 

The  following  suggestions  for  shop  organizations  of  workers  are 
intended  to  form  one  scheme.  Their  individual  value,  however,  does 
not  depend  on  the  adoption  of  the  scheme  as  a  whole,  each  being 
good  as  far  as  it  goes. 

I . ...Sh9pzSiewards_committe£^  As  pointed  out  in  the  last  sub- 
section, in  alactory  where  the  trade-union  is  strong  there  will 
probably  be  a  shop-stewards  or  trade-union  committee  already  in 
existence.  This  is,  of  course,  a  committee  of  workers  only,  elected 
generally  by  the  trade-union  members  in  the  works  to  look  after 
their  interests  and  to  conduct  negotiations  for  them  with  the  man- 
agement. Sometimes  the  stewards  carry  out  other  purely  trade- 
union  work,  such  as  collecting  subscriptions,  obtaining  new  members, 
explaining  union  rules,  etc.  Such  a  committee  is  the  most  obvious 
and  simplest  type  of  works  committee,  and  where  the  composition 
of  the  shop  is  simple  (that  is,  mainly  one  trade,  with  no  very  great 
differences  in  grade)  a  shop-stewards  committee  could  deal  with 
many  of  the  questions  laid  down  as  suitable  for  joint  handling. 

It  is  doubtful,  however,  whether  a  shop-stewards  committee  can, 
or  should,  cover  the  full  range  of  workers'  activities  except  in  the 
very  simplest  type  of  works.  The  mere  fact  that  as  a  purely  trade- 
union  organization  it  will  deal  primarily  with  wages  and  piecework 
questions  will  tend  to  introduce  an  atmosphere  of  bargaining,  which 
would  make  the  discussion  of  more  general  questions  very  difficult. 
Further,  such  a  committee  would  be  likely  to  consider  very  little 
else   than   the   interests   of   the   trade-union   or   of   themselves   as 


304       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

trade-unionists.  While  this  is  no  doubt  quite  legitimate  as  regards 
such  questions  as  wages,  the  more  general  questions  of  workshop 
amenities  should  be  considered  from  the  point  of  view  of  the  works 
as  a  community  in  which  the  workers  have  common  interests  with 
the  management  in  finding  and  maintaining  the  best  conditions  pos- 
sible. Moreover,  in  many  shops,  where  workers  of  widely  differing 
grades  and  trades  are  employed,  a  shop-stewards  committee  is  not 
likely  to  represent  truly  the  whole  of  the  workers,  but  only  the 
better-organized  sections. 

The  shop-stewards  committee,  in  the  engineering  trade  at  least,  is 
fairly  certain  to  constitute  itself  without  any  help  from  the  manage- 
ment. The  management  should  hasten  to  recognize  it  and  give  it 
every  facility  for  carrying  on  its  business,  and  should  endeavor 
to  give  it  a  recognized  status  and  to  impress  it  with  a  sense  of 
responsibility. 

It  would  probably  be  desirable  that  shop  stewards  should  be 
elerted  by  secrelJialjot  rather  than  by  show  of  hands  in  open  meeting, 
in  order  that  the  most  responsible  men  may  be  chosen  and  not  merely 
the  loudest  talkers  or  the  most  popular.  It  seems  better,  also,  that 
stewards  should  be  elected  for  a  certain  definite  term,  instead  of 
holding  office,  as  is  sometimes  the  case  now,  until  they  resign,  leave 
the  firm,  or  are  actually  deposed.  The  shop-stewards  committee 
being  primarily  a  workers'  and  trade-union  affair,  both  these  points 
are  outside  the  legitimate  field  of  action  of  the  management.  The 
latter's  willingness  to  recognize  and  work  through  the  committee 
should,  however,  confer  some  right  to  make  suggestions  even  in  such 
matters  as  these. 

The  facilities  granted  by  the  management  might  very  well  include 
a  room  on  the  works  premises  in  which  to  hold  meetings  and  a  place 
to  keep  papers  etc.  If  works  conditions  make  it  difficult  for  the 
stewards  to  meet  out  of  work  hours,  it  would  be  well  to  allow  them 
to  hold  committee  meetings  in  working  hours  at  recognized  times. 
The  management  should  also  arrange  periodic  joint  meetings  with 
the  committee,  to  enable  both  sides  to  bring  forward  matters  of 
discussion. 

/    The  composition  of  the  joint  meeting  between  the  committee  of 

/shop  stewards  and  the  management  is  worth  considering  shortly. 

In  the  conception  here  set  forth  the  shop-stewards  committee  is  a 


WORKSHOP  COMMITTEES 


305 


complete  entity  by  itself;  it  is  not  merely  the  workers'  section  of 
some  larger  composite  committee  of  management  and  workers.  The 
joint  meetings  are  rather  in  the  nature  of  a  standing  arrangement 
on  the  part  of  the  management  for  receiving  deputations  from  the 
workers.  For  this  purpose  the  personnel  of  the  management  section 
need  not  be  fixed,  but  could  well  be  varied  according  to  the  subjects 
to  be  discussed.  It  should  always  include,  however,  the  highest  exec- 
utive authority  concerned  with  the  works.  For  the  rest,  there  might 
be  the  various  departmental  managers  and,  sometimes,  some  of  the 
foremen.  As  the  joint  meeting  is  not  an  instrument  of  management 
taking  decisions  by  vote,  the  number  of  the  management  contingent 
does  not  really  matter  beyond  assuring  that  all  useful  points  of  view 
are  represented. 

Too  much  importance  can  hardly  be  laid  on  the  desirability  of 
regularjoin^ meetings,  as  against  ad  hoc  meetings  called  to  discuss 
special  grievances.  According  to  the  first  plan  each  side  becomes 
used  to  meeting  the  other  in  the  ordinary  way  of  business,  say  once 
a  month,  when  no  special  issue  is  at  stake  and  no  special  tension  is 
in  the  air.  Each  can  hardly  fail  to  absorb  something  of  the  other's 
point  of  view.  At  a  special  meeting,  on  the  other  hand,  each  side 
is  apt  to  regard  as  its  business  not  the  discussion  of  a  question  on 
its  merits  but  simply  the  making  out  of  a  case.  And  the  fact  that 
a  meeting  is  called  specially  means  that  expectations  of  results  are 
raised  among  the  other  workers  which  make  it  difficult  to  allow  the 
necessary  time  or  number  of  meetings  for  the  proper  discussion  of 
a  complicated  question. 

Where  women  are  employed  in  considerable  numbers  along  with 
men  the  question  of  their  representation  by  stewards  becomes  im- 
portant. It  is  as  yet  too  early  to  say  how  this  situation  can  best  be 
met.  If  they  are  eligible  for  membership  in  the  same  trades-unions 
as  the  men,  the  shop-stewards  committee  might  consist  of  representa- 
tives of  both.  But  considering  the  situation  which  will  arise  after 
the  war,  when  the  interests  of  the  men  and  of  the  women  will  often 
be  opposed,  this  solution  does  not  seem  very  promising  at  present. 

Another  plan  would  be  for  a  separate  women's  shop-stewards 
committee  to  be  formed,  which  would  also  meet  the  management 
periodically  and  be,  in  fact,  a  duplicate  of  the  men's  organization. 
It  would  probably  also  hold  periodic  joint  meetings  with  the  men's 


^1 


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3o6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

committee,  to  unify  their  policies  as  far  as  possible.  This  plan  is 
somewhat  cumbersome,  but  seems  to  be  the  only  one  feasible  at 
present,  on  account  of  the  divergence  of  interest  and  the  very  different 
stage  of  development  in  organization  of  men  and  women. 

2.  SociaLunmi,  Some  organization  for  looking  after  recreation 
is  in  existence  in  many  works,  and  if  not,  there  is  much  to  be  said 
for  the  institution  of  such  a  body  as  the  social  union  here  described. 

Although  the  purpose  which  calls  together  the  members  of  a  works 
community  is,  of  course,  not  the  fostering  of  social  life  and  amenities, 
there  is  no  doubt  that  members  of  such  communities  do  attain  a 
fuller  life  and  more  satisfaction  from  their  association  together  when 
common  recreation  is  added  to  common  work.    It  may,  of  course,  be 
urged  against  such  a  development  of  community  life  in  industry  that 
it  is  better  for  people  to  get  away  from  their  work  and  to  meet  quite 
another  set  in  their  leisure  times.    This  is  no  doubt  true  enough,  but 
the  number  of  people  who  take  advantage  of  it  is  probably  very 
much  less  than  would  be  affected  by  social  activities  connected  with 
the  works.    The  development  of  such  activities  will,  in  consequence, 
almost  certainly  have  more  effect  in  spreading  opportunities  for  fuller 
life  than  it  will  have  in  restricting  them.    Moreover,  if  the  works  is 
a  large  one,  the  differences  in  outlook  between  the  various  sections 
are  perhaps  quite  as  great  as  can  be  met  with  outside.    For  this 
reason  the  cardinal  principle  for  such  organizations  is  to  mix  up 
the  different  sections  and  grades,  especially  the  works  and  the  office 
departments. 

The  sphere  of  the  social  union  includes  all  activities  other  than 
those  affecting  the  work  for  which  the  firm  is  organized.  This  sphere 
being  outside  the  work  of  the  firm,  the  organization  should  be  en- 
tirely voluntary  and  in  the  hands  of  the  workers,  though  the  manage- 
ment may  well  provide  facilities  such  as  rooms  and  playing  fields. 

Two  main  schemes  of  organization  are  usual.  In  the  first  a  general 
council  is  elected  by  the  members,  or,  if  possible,  by  all  the  employees, 
irrespective  of  department  or  grade.  This  council  is  responsible  for 
the  general  policy  of  the  social  union,  holds  the  funds,  and  under- 
takes the  starting  and  supervising  of  smaller  organizations  for  specific 
purposes.  Thus,  for  each  activity  a  club  or  society  would  be  formed 
under  the  auspices  of  the  council.  The  clubs  would  manage  their  own 
affairs  and  make  their  own  detail  arrangements. 


WORKSHOP  COMMITTEES 


307 


It  is  most  desirable  that  the  social  union  should  be  self-supporting 
as  far  as  running  expenses  go  and  should  not  be  subsidized  by  the 
management,  as  is  sometimes  done.  A  small  subscription  should 
be  paid  weekly  by  every  member,  such  subscription  admitting  them 
to  any  or  all  clubs.  The  funds  should  be  held  by  the  council  and 
spent  according  to  the  needs  of  the  various  clubs,  not  according  to 
the  subscriptions  traceable  to  the  membership  of  each.  This  is  very 
much  better  than  making  the  finances  of  each  club  self-supporting, 
since  it  emphasizes  the  "community"  feeling,  is  very  simple,  and 
enables  some  forms  of  recreation  to  be  carried  on  which  could  not 
possibly  be  made  to  pay  for  themselves. 

The  second  general  type  of  social-union  organization  involves 
making  the  clubs  themselves  the  basis.  Each  levies  its  own  sub- 
scriptions and  pays  its  own  expenses,  and  the  secretaries  of  the  clubs 
form  a  council  for  general  management.  This  is  a  less  desirable 
arrangement,  because  each  member  of  the  council  is  apt  to  regard 
himself  as  there  only  to  look  after  the  interests  of  his  club,  rather 
than  the  whole.  The  starting  of  new  activities  is  also  less  easy 
than  under  the  first  scheme. 

3.  Wfljarp.  f^q'tfimittee.  The  two  organizations  suggested  so  far, 
namely,  shop-stewards  committee  and  social  union,  do  not  cover  the 
whole  range  of  functions  outlined  in  Section  I.  In  considering  how 
much  of  that  field  still  remains  to  be  covered  it  is  simplest  first  to 
mark  off,  mentally,  the  sphere  of  the  social  union ;  namely,  social 
activities  outside  working  hours.  This  leaves  clear  the  real  problem ; 
namely,  all  the  questions  affecting  the  work  and  the  conditions  of 
work  of  the  firm.  These  are  then  conceived  as  falling  into  two  groups. 
First,  there  are  those  questions  in  which  the  interests  of  the  workers 
may  be  opposed  to  those  of  the  employer.  These  are  concerned  with 
such  matters  as  wage  and  piece  rates,  penalties  for  spoiled  work,  etc. 
With  regard  to  these  discussion  is  bound  to  be  of  the  nature  of  bar- 
gaining, and  these  are  the  field  for  the  shop-stewards  committee, 
negotiating  by  means  of  the  periodical  joint  meetings  with  the 
management. 

There  remains,  however,  a  second  class  of  questions,  in  which  there 
is  no  clash  of  interest  between  employer  and  employed.  These  are 
concerned  mainly  with  regulating  the  "community  life"  of  the  works, 
and  include  all  questions  of  general  shop  conditions  and  amenities 


I 


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308       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

and  the  more  purely  educational  matters.     For  dealing  with  this 
group  a  composite  committee  of  management  and  workers,  here  called 
the  Welfare  Committee,  is  suggested. 
^This  would  consist  of  two  parts : 

1.  Representatives  elected  by  workers. 

2.  Nominees  of  the  management. 

The  elected  side  might  well  represent  the  offices,  both  technical 
and  clerical,  as  well  as  the  works,  and  members  would  be  elected  by 
departments,  no  account  being  taken  of  the  various  grades.  Where 
women  are  employed  it  would  probably  be  desirable  for  them  to  elect 
separate  representatives.  If  they  are  in  departments  by  themselves, 
this  would  naturally  happen.  If  the  departments  are  mixed,  the  men 
and  women  of  such  departments  would  each  send  representatives. 

The  trade-union  or  unions  most  concerned  with  the  work  of  the 
firm  should  be  represented  in  some  fairly  direct  way.  This  might  be 
done  in  either  of  two  ways : 

1.  If  a  shop-stewards  committee  exists,  it  might  be  asked  to  send  one 

or  more  representatives. 

2.  Or  each  of  the  main  trade-unions  represented  in  the  works  might 

elect  one  or  more  representatives  to  represent  their  members 
as  trade-unionists. 

The  management  section  should  contain,  in  general,  the  highest 
members  of  the  management  who  concern  themselves  with  the  run- 
ning of  the  works  ;  it  would  be  no  use  to  have  here  men  in  subor- 
dinate positions,  as  much  of  the  discussion  would  deal  with  matters 
beyond  their  jurisdiction.  Moreover,  the  opportunity  for  the  higher 
management  to  get  into  touch  with  the  workers  would  be  too  im- 
portant to  miss.  It  is  doubtful  whether  there  is  any  need  for  the 
workers'  section  of  the  welfare  committee  to  meet  separately,  though 
there  is  no  objection  to  this  if  thought  desirable.  In  any  case  a 
good  many  questions  can  be  handed  over  by  the  joint  meeting  to 
subcommittees  for  working  out,  and  such  subcommittees  can,  where 
desirable,  consist  entirely  of  workers. 

It  may  be  urged  that  the  welfare  committee  is  an  unnecessary 
complication  and  either  that  its  work  could  be  carried  out  by  the 
shop-stewards  committee  or  that  the  work  of  both  could  be  handled 
by  a  single  composite  shop  committee  of  management  and  workers. 
In  practice,  however,  a  committee  of  the  workers  sitting  separately 


WORKSHOP  COMMITTEES 


309 


to  consider  those  interests  that  are,  or  appear  to  be,  opposed,  with 
regular  deputations  to  the  management,  and  a  composite  committee 
of^'workers  and  management  sitting  together  to  discuss  identical  in- 
terests would  seem  the  best  solution  of  a  difficult  problem. 

Everything  considered,  therefore,  there  seems,  in  many  works  at 
least,  to  be  a  good  case  for  the  institution  of  both  organizations, 
that  of  the  shop  stewards  and  that  of  the  welfare  committee.  The 
conditions  making  the  latter  desirable  and  possible  would  seem  to  be 

1.  A  management  sufficiently  methodical  and  constitutional  to  make 

previous  discussion  of  developments  feasible. 

2.  The  conditions  of  employment  fairly  stable. 

3.  The  trades  and  grades  included  in  the  shop  so  varied  and  mter- 

mixed  as  to  make  representation  by  a  committee  of  trade- 
union  shop  stewards  incomplete. 

SECTION  III.  SUMMARY  AND  CONCLUSIONS  OF 
SECTIONS  I  AND  II 

Gathering  together  the  views  and  suggestions  made  in  the  fore- 
going pages,  it  is  felt  that  three  separate  organizations  within  the 
works  are  necessary  to  represent  the  workers  in  the  highly  developed 
and  elaborate  organisms  which  modern  factories  tend  to  become. 

It  is  not  sufficient  criticism  of  such  a  proposal  to  say  that  it  is  too 
complicated.  Modern  industry  is  complicated,  and  the  attempt  to 
introduce  democratic  ideas  into  its  governance  will  necessarily  make 
it  more  so.  As  already  pointed  out,  the  scheme  need  not  be  accepted 
in  its  entirety.  For  any  trade  or  firm  fortunate  enough  to  operate 
under  simpler  conditions  than  those  here  assumed  only  such  of  the 
suggestions  need  be  accepted  as  suit  its  case. 

The  scope  of  the  three  committees  is  shown  by  the  following 

summary: 

I.  Shop-stewards  committee 

Sphere.    Controversial  questions  where  interests  of  employer 

and  worker  are  apparently  opposed. 
Constitution.    Consists   of   trade-unionist   workers   elected   by 
works  departments. 
Sits  by  itself,  but  has  regular  meetings  with  the  management. 
Examples  of  questions  dealt  with: 
Wage  and  piece  rates. 
The  carrying  out  of  trade-union  agreements. 


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310      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Negotiations  re  application  of  legislation  to  the  workers  repre- 
sented ;   for  example,  dilution,  exemption  from  recruiting. 
The  carrying  out  of  national  agreements  re  restoration  of 
trade-union  conditions,  demobilization  of  war  industries,  etc. 
Introduction  of  new  processes. 
Ventilation  of  grievances  re  any  of  above. 
Etc.,  etc. 
2.  Welfare  committee 

Sphere.     "Community"   questions,   where   there   is   no   clash 

between  interests  of  employer  and  worker. 
Constitution.    Composite  committee  of  management  and  work- 
ers, with  some  direct  representation  of  trade-unions. 
Sits  as  one  body,  with  some  questions  relegated  to  subcommit- 
tees, consisting  either  wholly  of  workers  or  of  workers  and 
management  according  to  the  nature  of  the  case. 
Examples  of  questions  dealt  with : 
Shop  rules. 
Such  working  conditions  as  starting  and  stopping  times,  meal 

hours,  night-shift  arrangements,  etc. 
Accident  and  sickness  arrangements. 
Shop  comfort  and  hygiene. 
Benevolent  work,  such  as  collections  for  charities,  hard  cases 

of  illness,  or  accident  among  the  workers. 
Education  schemes : 
Trade  technic. 
New  works  developments. 
Statistics  of  works  activity. 
Business  outlook. 
Promotions — explanation  and,  if  possible,  consultation. 
Ventilation  of  grievances  re  any  of  above. 
3.  Social  union 

Sphere.    Social  amenities,  mainly  outside  working  hours. 
Constitution.    Includes  any  or  all  grades  of  management  and 
workers. 

Governing  body  elected  by  members  irrespective  of  trade, 
grade,  or  sex. 
Example  of  activities: 

Institution  of  clubs  for  sports — cricket,  football,  swimming, 
etc. 

Recreative  societies— orchestral,  choral,  debating,  etc. 
Arranging  social  events — picnics,  dances,  etc. 
Provision  of  games,  library,  etc.,  for  use  in  meal  hours. 
Administration  of  clubrooms. 


Haxs  Rexold  Limited,  Manchester,  England 


C.  G.  Renold 


XXIII 

LABOR  ADMINISTRATION  IN  THE  SHIPBUILDING 
INDUSTRY   DURING   WAR   TIME^ 

THE  FUNCTIONING  OF  THE   ORGANIZATIONS   UPON 

PROBLEMS 

LIKE  practically  every  governmental  agency,  the  system  of  ship- 
yard labor  administration  was  just  getting  into  its  stride  when 
the  armistice  was  signed.  Early  mistakes  were  being  remedied,  and 
a  thorough  and  comprehensive  machinery  had  just  been  set  up.  But 
relatively  short  as  was  the  period  in  which  the  work  was  performed, 
the  functioning  of  the  organizations  upon  the  various  problems  can 
be  studied  and  stated  with  a  fair  degree  of  accuracy. 

I.  Wages 

The  wage  question  was  perhaps  the  most  perplexing  problem  with 
which  the  Emergency  Fleet  Corporation  dealt.    Increases,  it  should 
be  realized,  were  granted  not  only  by  the  Shipbuilding  Labor  Ad- 
justment Board  but  by  the  Corporation  itself.    In  IMay,  1918,  the 
Corporation  granted   certain  increases   to   salaried   employees  who 
earned  less  than  $2000  a  year,  since  the  Board  had  made  no  pro- 
vision for  these  grades.    Increases  for  leading  men,  quarter  men,^ 
and  foremen,  who  had  been  omitted  by  the  Board,  were  also  granted 
in  order  that  these  classes  might  receive  a  wage  in  reasonable  balance 
with  the  wages  of  the  men  employed  under  them.    The  Fleet  Cor- 
poration, however,  did  not  grant  further  increases  in  the  fall  of  1918, 
because  of  the  signing  of  the  armistice  and  the  probability  of  a 
plentiful  labor  supply. 

iFrom  Joiirnal  of  Political  Economy,  Vol.  XXVII  (iqiq),  pp.  362-396. 

2  By  leading  man  is  meant  the  foreman  of  a  group  of  ten  to  eighteen  work- 
men ;  by  quarter  man,  the  foreman  of  a  group  of  twenty-four  to  thirty 
workmen. 

311 


te 


{ - 


312       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

It  has  always  puzzled  the  man  in  the  street  how  the  Adjustment 
Board  and  the  Fleet  Corporation  were  enabled  to  order  these  in- 
creases to  be  paid  and  by  what  power  they  compelled  the  shipbuilders 
who  were  not  themselves  parties  to  the  memorandum  creating  the 
Board,  to  comply  with  their  decisions.  The  answer  is  very  simple. 
The  Fleet  Corporation  was  enabled  to  make  these  awards  effective 
only  by  promising  to  reimburse  the  shipbuilders  for  any  added 
labor  cost  occasioned  either  by  the  decisions  of  the  Board  or  by  the 
mstructions  of  the  Corporation. 

It  must  not  be  thought,  however,  that  this  policy  of  reimbursement 
was  adopted  immediately  and  uniformly.    It  was,  indeed,  uncertainty 
over  this  very  question  in  the  fall  of  1917  that  delayed  the  organi- 
zation of  the  Board.    For  months  after  the  first  decisions  it  was  the 
practice  to  grant  reimbursement  only  when  the  companies  made  ur- 
gent pleas  and  not  to  grant  it  to  companies  who  entered  no  claim 
Until  June  i,  1918,  there  was  no  uniform  method  of  granting  this 
reimbursement.    Each  case  was  settled  by  itself,  and  no  common 
accounting  practice  in  computing  or  paying  the  reimbursement  was 
followed-    The  shipbuilders  were  compelled  to  struggle  for  what  they 
got,  and  many  who  were  in  ignorance  of  the  situation  did  not  ask 
for  any  reimbursement  at  all.    The  situation  became  so  unsatisfac- 
tory that  on  May  31,  1918,  the  Fleet  Corporation  issued  a  lengthy 
General  Order  outlining  a  uniform  policy  to  be  followed  in  computing 
any  paying  for  the  increased  labor  cost.^    This  was  followed  by  a 
series  of  General  Orders  which  covered  further  points 

It  was,  however,  one  thing  to  establish  wage  rates  and  another  to 
enforce  them,  and  it  was  their  enforcement  that  occasioned  the 
greatest  difficulty  and  unrest.  The  violations  were  of  two  main 
types: 

I.  Neglect  on  the  part  of  shipbuilding  companies  to  pay  workmen 
backpay  due  them.  This  was  a  provocative  cause  of  dissatisfaction. 
The  Adjustment  Board  made  all  of  its  major  decisions  retroactive  to 
varying  dates.  The  computing  of  this  back  pay  was  difficult,  and 
the  shipbuilding  companies  were  very  slow  in  complying  with  the 
orders  of  the  Board  and  the  Fleet  Corporation.  In  September  1018 
some  of  the  yards  in  the  Columbia  River  district  had  not  paid  the 
retroactive  increases  granted  in  the  November,  1917,  decisions.  The 
iThis  was  the  much-consulted  General  Order  No.  36. 


SHIPYARD  LABOR  ADMINISTRATION  3^3 

conditions  were  also  unsatisfactory  in  several  other  districts.  This 
failure  promptly  to  pay  retroactive  increases  had  the  inevitable  result 
of  arousing  the  ire  of  the  men  and  making  them  impatient  with  the 
whole  svstem  of  wage  administration. 

2.  Violations  of  the  established  rate.  This  type  of  violation  was 
even  more  common,  and  was  basically  more  important,  than  the 
former.  The  two  memoranda  which  created  the  Board  were  drawn 
up  in  the  period  when  it  was  thought  that  the  chief  purpose  in  fixing 
the  wage  scale  was  to  protect  the  standard  of  living  of  the  workers 
against  the  increase  in  prices.  It  was  therefore  originally  intended 
to  make  the  wage  scale  fixed  by  the  Board  merely  a  minimum.  Both 
memoranda  term  the  wage  rates  which  the  Board  was  to  fix  as  ^' basic 
standards."  The  accepted  interpretation  of  this  phrase  is  that  the 
rates  established  are  to  be  minima  below  which  no  member  of  a  craft 
can  be  paid,  but  above  which  individual  workers  can  receive  a  higher 
wage  through  superior  ability  or  by  the  process  of  individual  bar- 
gaining. A  strike  on  the  part  of  the  union,  however,  to  obtain  a 
higher  basic  wage  for  all  members  of  the  craft  would  constitute  a 
violation  of  the  agreement  and  a  breach  of  faith.  The  Board  in  every 
one  of  its  first  set  of  decisions  explicitly  stated  that  the  rates  were 

minima. 

During  the  first  few  months  some  violations  were  complained  of 
where  companies  were  refusing  to  pay  as  high  wages  as  the  Board 
had  ordered  or  where  they  were  classifying  the  men  in  lower  grades 
with  lower  wages  than  those  to  which  the  workmen  rightly  belonged. 
The  Corporation  promptly  remedied  such  conditions. 

In  the  late  winter  and  early  spring  of  19 18  another  significant  de- 
velopment occurred,  which  was  caused  partly  by  the  drain  upon  the 
nation's  man  power,  following  upon  the  expansion  of  the  army. 
A  decided  shortage  in  labor  became  apparent,  which  was  especially 
acute  in  some  of  the  more  skilled  trades,  such  as  coppersmiths,  chip- 
pers  and  calkers,  riveters,  machinists,  blacksmiths,  etc.  There  was, 
moreover,  a  very  considerable  shortage  of  common  labor,  which  be- 
came more  acute  after  the  heavy  draft  quotas  of  the  late  spring  and 

.  early  fall  of  19 18. 

Each  contractor  was  desirous  of  completing  his  contract  and  was 
therefore  eager  to  get  a  sufficient  number  of  men.  He  was  conse- 
quently willing  to  pay  more  than  the  fixed  scale  in  order  to  get  the 


m 


riJ 


:  I 


314       TRADK  I'NIONISIV!   AND  LABOR  PROBLEMS 

men.    The  situation  became  especially  acute  in  the  Pacific  North- 
west, where  the  wage  scale  in  one  of  the  largest  shipbuilding  plants 
and  in  many  of  the  outside  shops  had  always  been  higher  than  that 
set  by  the  Board,  even  when  the  10  per  cent  bonus  of  December, 
191 7,  was  added.    The  result  was  a  competitive  bidding  for  labor! 
Workmen  moved  about  from  plant  to  plant,  and  the  stability  of 
labor  was  seriously  threatened.    The  production  program  was  hin- 
dered, for  men  who  were  needed  on  the  job  were  rushing  about  from 
plant  to  plant  on  railroad  trains.    The  Fleet  Corporation  tried  to 
check  this  by  refusing,  on  June  i,  19 18,  to  reimburse  shipbuilders 
for  any  wages  paid  in  excess  of  those  fixed  by  the  Board.    This  was 
strengthened  by  a  General  Order,  issued  July  i,  1918,  making  the 
established  scale  a  maximum  and  prohibiting  employers  from  ex- 
ceeding it.    It  should  be  emphasized  that  it  was  the  Fleet  Corporation 
and  not  the  Adjustment  Board  that  issued  these  orders  which  estab- 
lished the  Board's  rates  as  maxima,  although  the  Adjustment  Board 
unofficially  approved.' 

These  orders-  of  the  Corporation  were  followed  in  the  majority  of 
cases,  but  in  at  least  two  sections  of  the  country  they  were  dis- 
regarded.   As  has  been  stated,  the  situation  in  the  Seattle  district 
had  always  been  unsatisfactory,  and  in  order  to  hold  their  labor 
many  yards  raised  their  wages  to  a  point  far   in   excess  of  that 
set  by  the  Board,  until  the  situation  was  one  in  which  practically 
75  per  cent  of  the  men  were  receiving  more  than  the  authorized 
wage.    The  piecework  trades  along  the  Atlantic   Coast   were  also 
paid  at  a  higher  rate  than  that  authorized,  owing  to  the  permis- 
sion of  the  Board  to  use  the  "allowance  system"  on  difficult  work 
This  was  originally  intended  to  apply  only  to  work  which  was  so 
difficult  that  piece  rates  would  be  unfair,  and  it  was  not  intended 
to  cover  more  than  10  per  cent  of  the  operations  in  the  pre-war 

^This  was  sometimes  forgotten  even  by  members  of  the  Board  itself  ;  thus 
Mr.  Macy  m  blammg  Seattle  shipyard  employers  states  that  they  "violated 
a^l  orders  of  the  Shipbuilding  Lal^or  Adjustment   Board  and   the   Emrr'encv 

f^'.1il7rr'T>,"'"^"  "^°^"   '''   ^"   ^^^-   ^'  ^^^   -'^   authorized" 

'to  nt       t'  {    r-\T  ^'"''^'  ^'^'"^^y'  ^^'9'  P-  ^>-    (It-»^s  are  mine.) 
lo  prevent  shipbuilders  constructing  for  private  account  from  disrupting  the 
abor  market,  all  yards  of  this  group  were  compelled  to  obtain  a  ,Lrm  t  from 
he  Corporation,  bmding  themselves  not  to  exceed  the  authorized  scTle    Th^ 
legal  sanctions  behind  this  requirement  were  (r)  power  to  requis  tfon'hips  I 
withholding  priorities   on   materials,  etc.  :>  "uii  biups,  ^2; 


SHIPYARD  LABOR  ADMINISTRATION  3^5 

times  Tne  shortage  of  workers,  however,  was  such  that  most  of  the 
Atlantic  Coast  companies  abused  the  use  of  the  "allowance  system'' 
and  applied  it  to  nearly  all  of  the  piecework,  whether  it  was  difficult 
or  not  As  a  result  many  of  the  riveting  gangs  were  granted  from 
$25  to  $60  a  day  irrespective  of  the  number  of  rivets  driven,  and 
great  abuses  resulted.    This  was,  indeed,  not  finally  checked  until 

February,  1919-  .  1      -c     .•         f 

A  further  method  of  violation  was  the  improper  classification  of 

workers  by  shipbuilding  companies.    It  was  not  an  unknown  practice 

to  list  workers  under  classifications  with  higher  rates  of  pay  than 

were  actually  deserved.    Some  yards  hsted  mechanics  as  leading  men, 

quarter  men.  or  foremen,  and  thus  paid  them  a  higher  wage  without 

osten-iblv  violating  the  orders  of  the  Corporation.    In  several  yards 

there  were  in  some  trades  more  foremen  than  men,  while  in  one  yard 

there  were  actually  thirteen  foremen  and  two  men  in  a  particular 

The  violation  of  the  wage  scales  was  caused  not  only  by  the 
scarcity  of  labor  but  by  the  existence  of  cost-plus  contracts.  The 
number  of  these  contracts  was  not  so  large  as  has  been  commonly 
supposed  and,  indeed,  decreased  as  time  went  on,  but  many  of  the 
wood-ship  yards  and  a  few  of  the  steel  yards  were  on  this  basis. 
The  inevitable  result  of  these  contracts  was,  of  course,  to  make  the 
contractor  less  careful  of  his  labor  costs.  Although  there  were  only 
a  few  such  yards,  their  influence  was  widespread,  since  they  set  a 
pace  which  other  companies  felt  that  they  must  meet  in  order  to 

hold  their  labor  force. 

In  addition,  the  accounting  procedure  set  up  by  the  Fleet  Cor- 
poration to  cover  reimbursement  for  increased  labor  cost  was  cumber- 
some and  involved,  and  the  auditing  division  was  not  organized  as 
effectively  as  it  might  have  been.    Prior  to  the  signing  of  the  armis- 
tice most  of  the  companies  which  had  paid  rates  in  excess  of  the 
authorized  scale  were  reimbursed  for  all  their  labor  costs  and  even 
for  their  violations.    True,  the  government  will  not  necessarily  lose 
on  these  reimbursements,  for  final  settlements  were  not  made,  and 
steps  have  since  been  taken  to  protect  the  Treasury  against  improper 
wa-e-cost  claims.    Nevertheless  the  temporary  adjustments,  which 
sometimes  covered  improper  claims,  played  their  part  in  unsetthng 
labor  conditions. 


Wl 


3i6      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  "excessive"  wages  which  many  complained  that  the  shipyard 
workers  were  receiving,  when  they  did  actually  occur,  did  not  result 
from  the  decisions  of  the  Adjustment  Board,  which  merely  adjusted 
wages  m  keeping  with  the  increase  in  the  cost  of  living,'  but  were 
caused  either  by  the  competitive  bidding  of  the  employers  in  giv- 
ing higher  wages  than  those  awarded  in  order  to  attract  workmen  to 
their  particular  contract  or  by  the  practice  of  excessive  overtime 

In  spite  of  what  has  been  said,  it  is,  however,  undoubtedly  true 
that  in  the  majority  of  cases  the  Adjustment  Board's  rates  were  both 
maxima  and  minima,  and  that  consequently  standardization  of  wages 
was  roughly  effected.  *' 

After  the  signing  of  the  armistice,  as  will  be  stated  later,  the  Fleet 
Corporation  suspended  making  the  Board's  rates  maxima,  although 

oi  :h°:rrdt3e:°  ^'"'"^^  -''^  ^^^^^^'"^^ '-  -^^^ '-  -- 

II.  Hours 

The  basic  eight-hour  day  was  uniformly  established  in  the  shin- 
yards  as  the  standard  working-day.    Due  to  a  previous  custom  of  a 
Saturday  half-holiday  in  the  Delaware  River  district  the  basic  fortv- 
four-hour  week  was  established  there.   Overtime  was  paid  for  at  the 
rate  of  time  and  a  half  for  all  districts  save  the  Pacific  Coast  where 
It  was  paid  for  as  double  time.    Sunday  and  holiday  work  was  uni- 
versally paid  for  at  double  rates.    The  Labor  Adjustment  Board  fixed 
no  limits  as  to  the  amount  of  overtime  that  could  be  worked  in  the 
Pacific  Coast  districts,  but  in  their  other  decisions  they  prescribed 
a  maximum  working-day  of  twelve  hours  and  a  maximum  sixty- 
hour  working-week,  e.xcept  at  the  order  of  the  Fleet  Corporation  or 
Navy  Department.  ^ 

The  overtime  bonuses  increased  rather  than  decreased  the  length 
of  the  average  working-day.  The  men  were  anxious  to  receive  the 
extra  pay  for  overtime,  and  the  managements  were  willing,  because 
they  could  charge  the  expense  to  the  Fleet  Corporation.  Owing  to 
an  egregious  blunder  by  one  of  the  construction  divisions  of  the 
Corporation,  certain  shipyard  owners  were  even  paid  to  July  i,  1918, 

cen7ovcr^"he''io^6T.',    Tv''  ""   ""'   '''"'"  ^'""'  approximately   60  per 


SHIPYARD  LABOR  ADMINISTRATION  31? 

an  additional  bonus  of  from  25  per  cent  to  160  per  cent  on  every 
dollar  that  the  workmen  received  for  overtime.' 

A  better  system  to  encourage  overtime  could  not  have  been  devised. 
General  Manager  Piez  was  constantly  exerting  pressure  to  reduce 
the  amount  of  overtime,  but  up  to  June  i  there  were  no  defi""^  °^f  «^ 
issued  as  to  the  amount  which  would  be  allowed,  and  the  district 
managers  of  the  Corporation  were  given  a  great  deal  of  discretion 
On  June  i  the  amount  of  overtime  was  fixed  at  a  maximum  o 
two  hours  per  man  per  day,  "except  under  extraordinary  and  special 

circumstances."  ,, 

The  results  of  overtime  work  were,  of  course,  lamentable.  Not 
only  was  it  on  the  whole  inefficient  but  there  were  cases  where  men 
loafed  during  the  first  eight  hours  in  order  that  they  might  have  an 
excuse  for  working  overtime.  It  furthermore  directly  increased  ab- 
senteeism. Some  men  would  work  Sunday  at  double  time  and  then 
lay  off  a  day  during  the  week,  thus  getting  their  day's  rest  and 
receiving  seven  days'  pay  for  six  days'  work.  It  also  made  many  of 
the  rank  and  file  reluctant  to  have  more  men  added  to  the  working 
force  since  it  decreased  their  opportunities  for  overtime. 

The  labor  leaders  themselves  recognized  the  viciousness  of  over- 
time as  did  the  employers  after  their  premium  upon  it  was  taken 
away  and  representatives  of  both  parties  from  the  Pacific  Coast 
recommended  that  it  be  entirely  prohibited  except  during  cases  of 
ur-ent  necessity.  It  was  not  until  after  the  signing  of  the  armistice, 
however,  that  the  Fleet  Corporation  issued  an  order  specifically  put- 
ting the  work  on  an  eight-hour  day  and  abolishing  overtime.  Several 
small  groups  of  workmen  then  struck  because  they  were  prevented 
from  working  more  than  eight  hours  a  day. 

The  whole  experience  with  the  basic  eight-hour  day  and  the  over- 
time bonus  during  war  time  was  such  as  to  demonstrate  conclusively 
that  the  basic  eight-hour  day  on  contract  work  for  the  government 
really  conduces  to  a  long  working-day.  The  men  are  more  eager  to 
receive  the  overtime  bonus  than  they  are  to  limit  their  work  to  eight 
hours,  and  "loafing  on  the  job"  is  the  result.  Since  the  government 
iThe  reason  assigned  for  granting  this  bonus  was  that  the  efftciency  of  the 
vard  was  decreased  by  workin.  overtime  and  that  the  management  should  be 
rewarded  for  this  loss  This  is  an  eloquent  bit  of  testimony  to  the  necessity 
of  centraliring  the  control  of  labor  matters  in  one  department  under  com- 
petent  guidance. 


iJ 


IH 


3i8      TRADE  UNIOXISAr   WO  LABOR  PROBLEMS 

foots  the  bills  the  manafiements  do  not  have  the  objection  to  over- 
t-me  work  that  they  would  have  if  they  were  compelled  to  pay 
There  can  be  httle  doubt  that  the  Fleet  Corporation  lost  millions  of 
dollars  by  reason  of  this  practice,  and  it  seems  clear  that  a  better 
arrangement  would  have  been  to  establish  a  flat  eight-hour  day  and 
to  have  permitted  no  overtime  save  in  cases  of  an  emergency  and  at 
the  express  permission  of  the  Corporation's  representatives. 

in.   Unions,  Shop  Committees,  and  Collective  Bargaining 

The  creation  of  the  Shipbuilding  Labor  Adjustment  Board  was 

m  Itself  a  recognition  of  the  international  unions  and  collective  bar- 

gammg.    The  Fleet  Corporation  dealt  with  the  union  officials  as 

representafves  of  labor,  and   the  policy  pursued   by  the  Corpo- 

Cainin"g  ''  ''^  ^°"'  ''^^'^  ^''  ^"^'^  ^'  ""  ~^«  -"-^ve 

"cSe7shln"°'  "'  T't  '"'  "'^  ^''''  C°T'°'-^"'°"  '°--d  the 
closed  shop    was  really  that  of  refusing  to  disturb  the  status  quo. 

The  Board  refusea  to  permit  shops  to  be  closed  against  the  will  of 

the  empbyer  if  they  had  not  been  closed  prior  to  the  war.  Where  the 

districts    if  "'f-"*'  f  ""  ''^  '^"  ^^^"^-°  -d  P"g«t  Sound 

districts,  It  was  continued. 

The  Board  declared  that  discrimination  should  not  be  practiced 
against  any  workman  either  on  the  ground  that  he  belonged   or  on 

iv'trF";  Tr  '^ '" "°'  '^'°"^' '"  ^  -'-•  Th'=  -'  -f::c:d 

by  the  Fleet  Corporation,  and  many  men  who  had  been  discharged 
or  forced  from  employment  were  ordered  to  be  reinstated.    It  was 
of  course,  impos^ble  to  enforce  this  perfectly  because  of  the  difficulty 
in  determining  the  real  causes  for  dismissal. 

The  principles  promulgated  by  the  War  Labor  Conference  Board' 
were  adopted  by  the  Fleet  Corporation  as  its  labor  policy  and  it 
therefore  permitted  the  organization  of  the  workers  into  unions  and 

r^owt  T  "'"'""^  ^'^  '"^"  ^'"'^  ^■'""^''-  ''  '^  '^»->' ""  -as- 
ie  liuTe  doub  ZtT  """="  ''.'  ^''P^"'  "°^''*^^'  but  there  can 
that  itv  l\        ?'°"'  '"''*'  »''^'  S^'"^  '"  membership,  and 

that  they  emerged  from  the  war  far  stronger  than  when  they  went  in 


SHIPYARD  LABOR  ADMINISTRATION  JiQ 

One  of  the  striking  acts  of  the  Board  was  the  authorization  of  shop 
committees  to  handle  grievances.  This  was  first  provided  or  m  th 
Portland  district,  where  the  employers  refused  to  recognize  the  unions 
as  such.  It  wa  later  authorized  for  all  other  yards,  save  in  the 
Seattle  and  San  Francisco  districts.'  The  establishment  o  these  shop 
committees  was  really  intended  to  provide  """"f  \^.°"^^^;_;;^.\^^: 
gaining  and  adjustment  of  grievances  in  those  yards  which  would  not 
recognize  unions.  Although  many  of  these  committees  were  organ- 
ized, they  cannot  be  said  to  have  been  a  success,  in  actual  operation, 

exceot  in  one  district.  ,   i  n  -^^  i 

In  one  district,  for  example,  not  many  of  the  yards  had  definitely 
constituted  committees,  with  regular  periods  of  ■"feting    nor  were 
all  crafts  within  the  yards  organized.   The  committees  m  this  district 
did  not  consider  more  than  20  per  cent  of  the  complaints  which  arose 
and  the  other  80  per  cent  were  taken  up  with  the  exammer  himsel 
either  by  the  business  agents  of  the  unions  or  by  the  direct  appeal 

of  the  parties  interested. 

The  chief  reasons  for  the  failure  of  these  committees  to  function 

were  as  follows:  ,    ,    „,.^,    ....  ^ 

I    The  lack  oj  active  onanizafwn  upon  the  part  of  the  Shipbuilding^ 

Labor  Adjustment  Board.   The  Board  authorized  the  organization  o, 

the  committees,  but  for  a  long  time  did  little  else.   Only  one  o    the 

examiners  devoted  much  attention  to  organizing  these  committees. 

Moreover,  when  the  committees  were  organized  they  were  not  always 

siven  proper  facilities  for  conducting  business. 

2    The  indifference  of  the  workers.   The  men  were  busy  and  were 

earning  good  wages  and  did  not  take  much  interest  in  organizing 

the  committees. 

,  The  more  or  less  open  hostility  of  the  unions.  The  unions  were 
afraid  that  the  committees  would  usurp  their  functions  and  that  they 
could  be  used  to  break  down  the  unions.  This  was  not  wholly  un- 
justified, since  in  some  cases  the  employers  attempted  to  control  the 
election  of  the  committeemen.  Perhaps  the  most  important  point 
about  the  organization  of  shop  committees  is  as  to  whether  they  will 

1  Alihounh  authorized  for  the  Delaware  River  district  in  the  October  24,  191S, 
deci^on  no  ^  committees  were  set  up  there  because  of  the  comphcat.ons 
with  the  unions  that  might  result. 


w 


320      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

be  a  substitute  for,  or  a  supplement  to,  unionism.^  The  unions  have 
been  loath  to  approve  of  them  until  they  were  convinced  that  they  were 
intended  to  be  the  latter  and  not  the  former. 


IV.    Labor  Supply 

The   Fleet   Corporation  officials   at   first   regarded   the  securing 
of  materials  as  the  most  pressing  production  problem,  but  after 
this  had   been  centralized   in   a   Supply   Division   the  securing   of 
sufficient  labor  became  the  most  urgent  problem.    It  was  the  ques- 
tion  whether  enough   men   could    be   brought    into    the   shipyards 
and  trained  that  most  agitated   shipbuilders  during    1918.    There 
were  really  two  problems  of  labor  supply:    (i)    that  of  securing 
a  sufficient  number  of  men  for  the  industry  as  a  whole ;   (2)  that  o'f 
distributing  this  labor  so  that  all  yards  could  have  'an  adequate 
amount.    Table  I  shows  the  number  of  men  working  in  the  shipyards. 
One  must  first  ascertain  how  many  men  were  needed  to  carry  out  the 
production  program  before  estimating  whether  the  industry  as  a 
whole  had  a  sufficient  labor  force.    This  can  now  be  done  with  some 
accuracy,  but  it  was  very  diftkult  formerly,  for  the  Shipping  Board 
never  furnished  the  Fleet  Corporation  with  a  program  to  be  attained. 
The  chairman  of  the  Board  at  Congressional  hearings  and  in  public 
speeches  set  varying  figures.    The  19 18  program  of  deliveries  for 
steel  ships  was  set  by  various  authorities  at  6,000,000  and  4,000,000 
tons.    This  was  later  scaled  down  to  3,100,000  tons  by  the  production 
engineers  of  the  Fleet  Corporation.   As  for  wood  ships,  there  was 
never  a  real  production  program.    Contracts  were  let  more  to  fill 
the  ways  than  with  a  view  to  a  comprehensive  and  well-thought-out 
policy. 

Since  only  2,600,000  tons  of  steel  ships  were  delivered  in  19 18  the 
steel-ship  shortage  was  consequently  500,000  tons.^'  Since  the  aver- 
age production  per  man-year  was  approximately  25  dead-weight  tons 
(which  is  a  fairly  creditable  production  record)  the  average  shortage 

iSee  the  statement  by  Mr.  Macy,  the  chairman  of  the  Board,  "Shop  Com- 
mittees must  not  be  regarded  as  a  substitute  for  the  unions"  (National  Civic 
Federation  Revieio,  February  25,  1919,  p.  2).  "*  t^«a*  ^ivic 

A.17^^l  '''  1  ^''°°'°°°  ^^«^'S  's  ^^'^e"  as  the  goal  to  be  attained.   It  is  a  great 
deal  below  the  early  estimates  of  6,000,000  tons. 


''if 

11^ 


SHIPYARD  LABOR  ADMINISTRATION 


321 


of  labor  in  the  steel  yards  during  19 18  seems  to  have  been  around 
20,000.  The  adequacy  of  the  wood-ship  labor  force  is  difficult  to 
judge,  since  there  was  no  program  with  which  to  compare  it.  It  is 
unquestionably  true,  however,  that  there  were  as  many  workmen 
employed  as  the  value  of  w^ooden  ships  as  ocean  carriers  justified. 
On  the  whole,  therefore,  while  there  was  a  shortage  of  labor  in 
the  steel  yards,  this  shortage  was  not  as  acute  as  was  maintained 
at  the  time. 

Table  I.  Growth  of  the  Labor  Force  on  E.F.C.  Work  in  Shipyards 

BY  Months 


Month 

Average  Number  ok 

Employees  in  Woou- 

Ship  Yards  on 

E.F.C.  Work 

Average  Number  of 
Employees  in  Steel- 
Ship  Yards  on 
E.F.C.  Work 

Total  Employees  in 
Shipyards  as 
E.F.C.  Work 

I917 

October      .... 

12,000  (est.) 

76,000  (est.) 

88,000  (est.) 

November  .... 

17,000  (est.) 

103,000  (est.) 

120,000  (est.) 

December  .... 

21,000  (est.) 

125,000  (est.) 

146,000  (est.) 

1918 

January  

February    .... 

31,000 
38,000 

160,000 
1 66,000 

191,000 
204,000 

March 

47,000 

181,000 

228,000 

April 

58,000 

200,000 

258,000 

May 

June 

70,000 
77.000 

2 1 1 ,000 
237,000 

281,000 
314,000 

July 

August 

September.  .  .  . 
October 

81,000 
85,000 
91,000 
91,000 

251,000 
267,000 
280,000 
284,000 

332,000 
352,000 
371,000 
375,000 

November  .... 

86,000 

299,000 

385,000 

These  statistics  do  not  include  those  employed  in  plants  devoted  exclusively 
to  fitting  out  hulls  after  launching.  They  do  include,  however,  some  clerical 
employees  (not  more  than  a  few  thousand  in  number)  who  should  be  charged 
to  construction  work  for  the  navy.  j     •  u 

The  total  number  of  employees  listed  in  the  table  should  not  be  confused  with 
the  number  of  men  actually  engaged  in  shipbuilding.  In  January,  1918,  only  63.7 
per  cent  of  the  employees  were  shipbuilders,  while  26.4  per  cent  were  engaged 
on  plant  construction,  and  9.9  per  cent  were  office  employees.  Indeed,  until  May 
over  20  per  cent  of  the  men  were  working  on  plant  construction.  By  October  the 
percentage  in  shipbuilding  had  increased  to  83.8  per  cent  of  the  total  force,  and 
the  percentage  on  plant  construction  had  decreased  to  7.7  per  cent. 


i 


fii 


31 


^1 


-        1 

ffiBI 


322       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Despite  the  difficulties  of  drawing  men  to  a  new  and  exposed  in- 
dustry, where  transportation  and  housing  facilities  were  often  over- 
crowded and  inadequate,  the  recruiting  of  the  men  for  the  industry 
as  a  whole  was  accomplished  without  elaborate  administrative  organi- 
zation by  the  Fleet  Corporation  itself.    The  one  organization  which 
was  started,  namely  the  United  States  Shipyard  Volunteers,  was  con- 
ceived and  managed  by  the  Shipping  Board  and  the  United  States 
Department  of  Labor  rather  than  by  the  Fleet  Corporation  officials. 
The  280,000  men  who  were  enrolled  in  this  organization  were  listed 
without  proper  investigation  of  their  qualifications  or  as  to  whether 
they  were  engaged  in  other  essential  industries.    Once  enrolled,  they 
were  not  called  upon,  for  preference  in  employment  was  given  to 
those  who  were  unemployed  over  those  enrolled   in  the  Shipyard 
Volunteers.    The  men  had  expected  that  they  would  soon  be  called 
to  service  in  the  yards,  and  many  gave  up  their  jobs.    The  manage- 
ment of  the  Shipyard  Volunteers,  however,  did  not  follow  up  the 
campaign  of  enrollment  and  did  not  work  out  with  the  shipyards  any 
concerted  plan  whereby  the  labor  requirements  of  the  yards  might 
be  ascertained  and  men  furnished  to  them. 

After  August  i,  of  course,  the  shipyards  were  compelled  to  hire 
all  of  their  unskilled  labor  through  the  United  States  Employment 
Service.  Skilled  labor  could,  however,  be  hired  through  private 
agencies,  and  the  labor  scouts  of  the  shipyards  themselves  were  in 
most  cases  merely  supervised  by  the  Employment  Service  and  allowed 
to  act  for  their  individual  companies  in  the  securing  of  both  skilled 
and  unskilled  labor. 

The  movement  of  labor  to  the  yards  was  therefore  voluntary  and 
in  the  main  unorganized.  The  facts  which  enabled  the  shipbuildincr 
mdustry  to  obtam  m  this  way  the  300,000  men  were  principally 
the  following : 

I.  Higher  wages  than  those  paid  in  the  majority  of  other  industries. 
A3  has  been  stated,  the  Adjustment  Board  and  the  Fleet  Corporation 
itself  sought  to  make  shipyard  wages  higher  than  the  average  wage 
level  in  order  to  draw  men  to  the  yards.  A  substantial  differential 
was,  on  the  whole,  created.  In  certain  sections  of  the  country,  how- 
ever, the  wage  scale  in  outside  industries  for  some  classes  of  labor 
caught  up  with  and  even  surpassed  that  of  the  shipyards.  On  the 
Pacific  Coast  much  difficulty  was  experienced  in  retaining  common 


SHIPYARD  LABOR  ADMINISTRATION 


323 


labor  in  the  shipyards,  since  lumber  camps  and  other  occupations 
were  paying  more  for  common  labor  than  the  wage  scale  fixed  by  the 
Board.  Late  in  the  summer  of  1918  the  same  situation  with  respect 
to  common  labor  prevailed  in  the  Middle  Atlantic  States. 

This  attempt  of  the  Board  to  fix  higher  wages  than  those  in  other 
industries  was  probably  justified  because  of  the  urgency  of  the  need 
for  ships  and  the  necessity  of  getting  men  to  build  them.  The  men 
thus  attracted  were,  however,  drawn  not  only  from  nonessential  but 
from  essential  industries  as  well,  and  the  whole  situation  illustrated 
the  necessity  for  a  general  standardization  of  wages,  which  un- 
doubtedly would  have  been  effected  had  the  war  continued  for  a 
few  months  longer. 

2.  Patriotic  desire  of  men  to  assist  the  government.  The  need  for 
ships  was  widely  advertised,  and  many  thousands  of  men  went  to 
the  shipyards  in  order  to  help  "  do  their  bit." 

3.  Protection  against  draft.  Under  the  selective-service  law  the 
general  staff  created  an  "Emergency  Fleet"  listing,  whereby,  in 
addition  to  the  ordinary  industrial  exemption  granted  to  all  essential 
industries,  additional  men  could  be  protected  from  the  draft  and  the 
labor  force  constantly  stabilized.  Some  90,000  workers  in  the  800  ship- 
yards and  industrial  plants  having  contracts  with  the  Fleet  Corpora- 
tion were  thus  exempted  from  the  draft  under  this  form.  Thus  both 
patriotic  reasons  and  the  desire  to  escape  military  service  operated 
to  bring  men  to  the  yards  and  to  keep  them  when  they  were  once  there. 

4.  Payment  by  the  Fleet  Corporation  of  the  transportation  ex- 
penses of  workers  to  the  job.  In  order  to  facilitate  the  movement  of 
men  from  inland  points  to  the  shipyards,  the  Fleet  Corporation 
entered  into  an  agreement  with  the  United  States  Employment  Serv- 
ice early  in  the  winter  of  19 18  to  pay  the  transportation  of  labor 
to  the  yards.  This  free  transportation  was  not  administered  very 
efficiently  by  the  Employment  Service,  and  moreover  it  operated 
directly  to  increase  the  turnover  of  labor,  because  men  could  leave 
one  job  and  go  to  another  at  the  expense  of  the  Fleet  Corporation. 
One  man  traveled  back  and  forth  across  the  continent  three  times 
at  the  expense  of  the  Corporation.  Just  before  the  conclusion  of  the 
armistice  a  system  of  control  had  been  set  up  which  promised  to 
handle  the  matter.  After  the  armistice  was  signed  this  payment,  of 
course,  was  discontinued. 


r 


i 


324      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

While  it  is  probably  true  that,  taken  as  a  whole,  the  yards  of  the 
country  had  nearly  a  sufficient  labor  supply,  it  is  just  as  true  that 
this  supply  was  poorly  distributed.  Many  yards  had  so  many  men 
that  they  could  not  be  directed  efficiently,  and  men  were  compelled 
to  remam  idle  because  of  lack  of  work  which  they  could  do.  The 
early  days  of  the  Hog  Island  and  Submarine-Boat  projects  were  but 
lurid  examples ;  the  same  situation  existed,  though  in  a  lesser  degree 
in  many  other  yards.  ' 

There  were,  on  the  other  hand,  other  yards  which  were  greatly 
undermanned,  and  the  causes  for  the  dearth  of  labor  in  these  yards 
were  primarily  three: 

I.  The  individualistic  attitude  of  the  shipyard  managements 
whereby  each  contractor  ivas  concerned  only  with  his  own  contract 
It  was  the  common  practice  of  shipyards  to  attempt  to  recruit  labor 
not  only  from  industries  other  than  shipbuilding  but  from  other 
shipbuilders  as  well.  Sometimes  this  was  done  directly  and  em- 
ployees of  another  company  were  "scamped"  by  labor  scouts,  who 
promised  the  men  higher  wages,  more  overtime,  better  housing  and 
a  score  of  similar  inducements.  Sometimes  it  was  done  indirectly 
by  advertisements  stating  supposedly  superior  advantages. 

The  labor  forces  of  many  shipyards  were  crippled  by  this  "scamp- 
mg"  of  labor,  and  shipbuilders  often  seemed  more  interested  in 
stealing  labor  from  other  companies  than  they  were  in  retaining  the 
supply  that  they  had.^  The  employers  who  were  most  conscientious 
and  refused  to  "scamp"  were  those  who  were  penalized.  The  result 
of  this  individualistic  attitude  was  an  enormous  loss  in  productivity 
due  to  the  loss  of  time  in  the  shifting  of  labor  and  the  impossibilitv 
of  maintaining  a  stable  force. 

2.  Competition    for    labor    by    other    government    departments     • 
A  number  of  yards  lost  their  men  because  other  near-by  government 
industries  were  paying  higher  wages  than  the  yards  could  pay 

3.  Unattractiveness  of  certain  shipyards  and  inefficient  manage- 
ment. Wherever  poor  housing,  inadequate  transportation,  and  in- 
sanitary and  dangerous  conditions  existed  men  were  loath  to  stay. 

1  One  enterprising  labor  scout  is  reported  to  have  promised  a  group  of  shio- 
buUders  on  the  street  higher  pay  than  they  were  then  receiving,  only  to  di  cove'i 
after  he  had  taken  them  to  work,  that  they  were  already  em^d  at  trown 


SHIPYARD  LABOR  ADMINISTRATION 


325 


This  was  heightened  in  many  cases  by  the  inefficient  management 
of  the  plants,  which  made  men  discouraged  and  disgruntled.  Thus 
inefficient  management  was  a  cause  both  of  some  yards'  having  too 
much  labor  and  of  other  yards'  having  too  little. 

It  has  been  said  above  that  the  Fleet  Corporation  did  not  perfect 
an  elaborate  organization  to  deal  with  the  problem  of  labor  supply. 
A  short  time  prior  to  the  signing  of  the  armistice  a  Labor  Supply 
Section  was  created  in  the  Industrial  Relations  Division  to  deal 
with  the  matter.  This  section  did  not  have  sufficient  time  to  demon- 
strate its  usefulness,  but  it  probably  would  have  served  to  stabilize 
the  situation  and  would  have  aided  in  supplying  the  additional  men 
that  would  have  been  needed  had  the  war  continued.  This  section 
had  perfected  a  system  whereby  the  labor  needs  of  the  shipbuilders 
might  be  ascertained  and  was  devising  methods  whereby  the  labor 
could  be  supplied  to  the  yards.  It  was,  indeed,  getting  ready  to  allo- 
cate labor  in  much  the  same  way  in  which  the  Supply  Division  had 
allocated  materials. 

The  most  important  task  which  the  Labor  Supply  Section  actually 
undertook  was  its  canvass  among  the  demobilization  camps.  Agents 
were  placed  in  the  thirty  demobilization  camps  of  the  country  to 
spread  information  about  shipyard  work  to  the  soldiers,  although 
work  was  not  guaranteed  to  anyone.  The  names  of  the  soldiers  in- 
terested were  filed,  and  the  shipyards  were  then  furnished  with  the 
names  of  men  in  their  vicinity  and  put  in  touch  with  the  returning 
soldiers. 

V.   Employment  Management 

Prior  to  19 1 8  only  thirteen  shipyards  had  employment  departments 
in  any  organized  form.  Yet  as  the  war  progressed  the  problem  of 
increasing  ship  production,  with  a  steadily  decreasing  supply  of 
workmen  in  industry,  required  shipbuilding  managers  to  give  special 
attention  to  securing,  placing,  and  maintaining  a  competent  and 
adequate  force  of  workers.  It  has  been  found  that  in  many  cases  the 
greatest  handicap  to  production  is  not  the  scarcity  of  men  but  the 
attempt  to  choose  and  retain  employees  without  careful  thought  or 
plan.  Accordingly  the  Industrial  Service  Department  of  the  Fleet 
Corporation  at  first  conducted  pioneer  educational  activities  to 
promote  the  establishment  and  improvement  of  properly  functioning 


'i^ 


326      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

employment  departments.  The  Employment  Management  Branch 
of  the  Industrial  Relations  Division  later  cooperated  with  certain 
universities  in  training  employment  managers,  provided  the  shipyards 
with  detailed  plans  for  employment  departments  to  meet  their 
respective  needs,  and  assisted  in  placing  employment  managers  and 
assistants  as  openings  for  them  developed. 

The  more  tangible  results  of  this  work  may  be  indicated.    In  addi- 
tion to  correspondence,  conferences,  printing  manuals,  and  organizing 
employment  managers'  associations,  surveys  of  employment  methods 
were  made  in  fifty-two  yards.    Direct  assistance  was  given  in  im- 
proving their  procedure  and  in  planning  fourteen  employment  and 
service  buildings.    Standard  forms  on  employment  procedure,  han- 
dling labor  loss,  physical  examinations,  labor  adjustment,  and'  other 
approved  practices  were  prepared  and  made  available  to  all  yards 
Forty-one    representatives    of    shipbuilding    companies    took    the 
employment-management    courses.     Twenty-nine    men    were    also 
trained  as  reserve  employment  managers,  and  from  these  twenty- 
three  were  placed  as  employment  and  service  managers  and  assistants. 
New  centralized  employment  departments  were  established  in  twenty- 
one  shipyards. 

These  various  improvements  have  probably  contributed  to  the 
stabilization  of  labor  employed  in  shipbuilding.  Complicating  factors 
due  to  the  unsettled  industrial  conditions  of  war  time,  especially 
aggravated  in  the  expanding  shipbuilding  industry,  enter  into  the 
situation  and  prevent  a  fair  comparison  of  different  periods  as  to 
the  stabilizing  effects  of  proper  methods  of  employment  management 
No  conclusions,  therefore,  are  deducible  from  the  chart  of  the  per- 
centage of  labor  turnover,  given  later  in  this  article,  as  to  the  effect 
of  improved  employment  procedure  on  turnover.  Further  experience 
alone  can  provide  data  upon  which  to  base  reliable  deductions. 

VI.   The  Training  of  Men 

The  mere  addition  of  285,000  men  to  shipyards  did  not  solve  the 
problem  of  building  ships.  A  large  percentage  of  these  men  had  to 
be  trained.  In  November,  19 17,  this  work  was  organized  and  two 
methods  were  adopted:  (i)  that  of  training  skilled  shipyard  crafts- 
men to  become  instructors  and  (2)  that  of  using  these  instructors 


SHIPYARD  LABOR  ADMINISTBIATION 


327 


as  teachers  of  green  men  upon  the  job  in  the  shipyards  to  which 
they  returned. 

Thirty-seven  training  centers  for  the  training  of  instructors  were 
established,  covering  all  sections  of  the  country.  Approximately  iioo 
instructors  were  given  the  six  weeks'  training  course^  the  aim  of  which 
was  to  enable  them  to  teach  what  they  already  knew.  The  men  who 
had  been  given  the  instructor  training  returned  to  the  seventy-one 
yards  from  whence  they  had  been  sent  and  started  to  train  workmen 
on  the  job.^ 

These  training  courses  in  the  shipyards  were  brought  under  the 
control  and  supervision  of  the  Fleet  Corporation  by  an  ingenious 
$i-a-day  bonus  given  to  those  yards  v/ith  properly  established  training 
departments,  which  was  to  be  shared  equally  between  learner  and 
employer  if  the  learner  should  stay  in  the  employ  of  the  yard  for 
seventy-eight  days. 

Of  the  285,000  which  were  added  to  the  shipbuilding  rolls  from 
October,  191 7,  to  October,  19 18,  it  is  probable  that  one  half  went 
into  types  of  work  for  which  little  or  no  training  was  required.  The 
remaining  half,  or  approximately  140,000  in  all,  did  need  training. 
How  far  was  this  need  met  by  the  training  system  which  was  set  up 
by  the  Fleet  Corporation  ?  Careful  estimates  made  by  the  Education 
and  Training  Section  indicate  that  the  11 00  instructors  trained  ap- 
proximately 80,000  men,  or  about  57  per  cent  of  all  that  needed 
training. 

It  was  possible  to  do  this  because  it  was  found  that  men  could 
be  trained  for  shipbuilding  trades  in  a  relatively  short  period  of  time. 
Statistics  from  twenty-one  yards  indicate  that  the  average  training 
period  for  all  men  was  nineteen  days.^ 

Table  II  shows  the  length  of  training  period  by  trades.  When  the 
learners  left  their  training  course  they  were  able  in  the  main  to  hold 
their  own  with  experienced  journeymen,  while  in  certain  cases  they 
even  excelled  the  journeymen  in  the  latter  part  of  their  training 
period.  The  men  who  were  thus  taught  trades  were  drawn  principally 
from  unskilled  shipyard  work  and  frorn  manufacturing.    The  fact 

lAll  but  three  of  these  were  steel-ship  yards.  The  system  of  training  was 
not  adopted  by  wood-ship  yards  to  any  extent. 

2 1  am  indebted  for  these  statistics  to  Mr.  E.  E.  MacNary,  head  of  the  Edu- 
cation and  Training  Section. 


m 


imi 


i 


328       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

that  these  men  could  be  adapted  to  specific  trades  in  so  short  a  time 
throws  an  interesting  sidelight  upon  the  amount  of  skill  required 
in  modern  industry  under  the  division  of  labor.  One  of  the  most 
notable  contributions  to  the  theory  of  vocational  education  was  the 
fact  that  these  men  were  trained  on  the  job  at  actual  processes  under 
normal  working  conditions.  Supervised  by  an  instructor,  they  worked 
m  groups  alongside  of  other  groups  of  experienced  workmen  It  is 
noteworthy  that  they  did  better  work  in  these  cases  than  when  they 
were  attached  to  "school  hulls";  that  is,  hulls  upon  which  only 
learners  were  employed. 

Table  II.  Length  of  Training  Period  for  Twenty  Trades  in  Twenty- 
one  Yards,  Covering  9700  Men 


Trade 


Riveters  . 
Holders-on 
Heaters   . 
Ship  fitters 
Chippers 
Drillers    . 
Reamers . 
Bolters    . 
Linermen 
Erectors  . 


Average  Days 
FOR  Each  Trape 


28 

14 
10 

51 

28 

J3 
12 

10 

8 

20 


Trade 


Machinists     . 

Pipe  fitters     . 

Regulators     . 
Gas  welders 
Electric  welders 
Burners      .    . 
Punchmen 
Ship  carpenters 
Hand  calkers 
Tank-testers  . 


Average  Davs 
FOR  Each  Tkadf, 


39 

39 
12 

30 
28 

23 
21 

48 

34 

33 


Other  educational  activities  carried  through  by  the  Education  and 
Traming  Section  were  (i)  supplementary  industrial  training  for 
journeymen  by  means  of  short  courses  on  the  principles  of  their 
trade;  (2)  technical  education  for  members  of  the  supervisory 
force;  (3)  electric  welding,  in  which,  through  the  efforts  of  the 
Education  and  Training  Section,  a  new  technic  was  developed  as 
well  as  instructors  trained;  and  (4)  foremen-training. 

It  IS  not  too  much  to  state  that  the  education  and  training  carried 
through  by  the  Fleet  Corporation  was  a  notable  achievement  in 
the  field  of  vocational  education. 


SHIPYARD  LABOR  ADMINISTRATION 
VII.  Health  and  Sanitation 


329 


It  is  impossible  to  appraise  fully  and  accurately  the  effect  on  pro- 
duction of  the  medical  and  sanitary  measures  that  were  fostered  by 
the   Industrial   Relations   Division   to   improve   and   maintain   the 
physical  welfare  of  shipyard  workers.    But  the  Health  and  Sanitation 
Section,  which  has  now  become  a  part  of  the  Public  Health  Service, 
functioned  effectively  in  dealing  with  the  concrete  problems  facing 
it.   The  field  sanitary  engineers  inspected  the  shipyards  every  thirty 
days.    The  section  supervised  and  organized  first-aid  work  for  injured 
men  and  provisions  for  medical  attention,  dispensary  and  hospital 
facilities,  medical  inspection,  and  quarantine.    It  improved  the  sani- 
tation about  the  shipyards  as  to  water  supply,  toilets,  sewage  dis- 
posal, bathing   facilities,  pure   food,   and  mosquito   extermination. 
State  and  local  communities  were  directly  induced  to  appropriate 
$672,000  for  exterminating  mosquitoes  in  shipbuilding  districts,  and 
the  mosquito  nuisance  was  reported  to  have  been  virtually  eliminated 
at  Hog   Island  and   at   the   shipyards   of   Chester,   Pennsylvania, 
and  Camden  and  Gloucester,  New  Jersey.    Epidemics  of  smallpox 
and  typhoid  fever  were  successfully  handled  in  seven  localities,  and 
vaccine  and  typhus  serums  were  supplied  to  all  yards  when  needed. 
Special  aid  was  rendered  during  the  influenza  epidemic,  and  where 
the  scourge  threatened  serious  curtailment  of  shipbuilding  temporary 

hospitals  were  erected. 

A  comprehensive  survey  of  medical  and  sanitary  conditions  in 
shipyards  has  also  been  recently  undertaken,  with  a  view  to  having 
a  basis  of  facts  upon  which  to  proceed  henceforth.  Much  remains 
to  be  accomplished  before  adequate  sanitary  standards  may  be  said 
to  obtain  in  every  shipyard,  but  the  measures  already  pursued  have 
been  of  decided  educational  and  material  advantage. 

VIII.   Safety  Engineering 

The  newness  of  the  industry,  the  inexperience  of  the  men  and  the 
management,  and  the  haste  with  which  shipyards  were  constructed 
and  ships  built  would  be  expected  to  lead  to  a  vastly  increased  rate 
of  personal  injuries  to  ship  workers.  In  the  early  months  of  the  war, 
indeed,  signs  were  not  wanting  that  such  was  the  case.  The  stories 
about  the  dangerous  character  of  the  work  which  were  so  widely 


330       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

circulated  in  the  late  months  of  19 17  and  the  early  winter  of  19  iS 
were  not  wholly  products  of  enemy  propaganda.  In  many  cases  they 
but  mirrored  the  true  condition  of  affairs. 

The  work  of  the  Safety  Engineering  Section  in  meeting  this  situa- 
tion has  been  most  notable.    Although  established  in  January,  19 18, 
it  was  not  until  the  creation  of  the  Industrial  Relations  Division 
that  its  district  organization  was  authorized  and  began  to  function. 
Prior  to  this  time  only  8  per  cent  of  the  shipyards  had  safety  or- 
ganizations.   The  district  safety  engineers  made  it  their  practice  to 
begin  by  interesting  the  officials  of  a  shipyard  company.    Central  and 
departmental  safety  committees  were  then  promoted,  and  in  yards 
which  were  large  enough  safety  engineers  were  appointed  by  the 
company.    Safety  conferences  and  committee  meetings  were  held,  at 
which  the  district  safety  engineers  made  addresses.    Pamphlets  were 
distributed  and  bill  posters  exhibited,  all  emphasizing  the  necessity 
of  safety  measures  to  the  employees.    Surveys  of  yard  conditions 
were  conducted,  and  standard  safety  specifications 'for  plant  con- 
struction and  equipment  were  furnished  to  all  yards.    On  January  i, 
19 1 9,  over  70  per  cent  of  the  yards  had  safety  organizations,  or  nearly 
a  nmefold  increase  over  the  number  six  months  before. 

It  is  possible  to  compare  the  pre-war  accident  rates  with  those  of 
the  war  period  after  safety  measures  had  been  partially  set  up 
Chaney  and  Hanna's  study  of  accident  and  accident  prevention  in 
marine  building  shows  that  in  steel-ship  yards  in  1912  there  were 
217.8  accidents  causing  loss  of  a  day's  work  or  more  for  every  1000 
full-time  workers  per  year,  or  18.2  per  month.^  Statistics  gathered  for 
the  last  quarter  of  19 18  from  twenty-four  typical  steel  yards  employ- 
mg  over  100,000  men  show  the  following  accident  frequency  per  1000 
workers  in  attendance  per  month: 2 

Month  „     Accident- 

Frequency  Rate 

October       .     .     . 

5.3 

November        .     .  r 

_  6.0 

December  ...  o 

0.1 

These  statistics  show  a  decrease  in  accident  frequency  to  a  point 
slightly  over  one  third  of  the  former  rate. 

^"Accidents  and  Accident   Prevention  in  Machine  BuUding,"  U.  S    Bureau 
of  Labor  Statistics,  Bulletin  No.  216,  p.  30. 

2  This  includes  men  working  in  shipyards  on  both  hulls  and  boilers. 


SHIPYARD  LABOR  ADMINISTRATION  331 

The  frequency  rate  computed  on  the  same  basis  for  forty-one  wood- 
ship  yards,  employing  approximately  3 5, 000  men,  was  as  follows: 

ACCIDENT- 

]^oi^TH  Frequency  Rate 

October 9-5 

November ^  ^  -4 

December 9-^ 

It  is  important,  however,  not  only  to  ascertain  the  decline  in  the 
frequency  of  accidents  but  also  to  determine  whether  the  relative 
severity  of  accidents  decreased.  As  is  well  known,  a  standard  weight- 
ing system  for  accidents  has  been  devised  by  Dr.  Chaney.  A  sub- 
stantially similar  one  was  used  by  the  Safety  Engineering  Section, 
so  that  the  results  are  comparable.'  Dr.  Chaney  found  that  in  steel- 
ship  building  in  19 12  accidents  caused  a  loss  of  eight  days  for  every 
full-time  worker  per  year,  or  0.66  days  per  month." 

The  accident-severity  rate  per  month  during  the  last  quarter  of 
19 1 8  for  the  twenty-four  steel-ship  yards  furnishes  an  interesting 
comparison  with  this.  accident-Severity 

Rate  (Days  per 
Month  Month) 

October 0-79i 

November o-4oi 

December 0.444 

It  will  thus  be  seen  that  the  severity  rates,  with  the  exception  of 
October,  were  substantially  lower  than  in  the  pre-war  period. 

In  the  forty-one  wood-ship  yards,  however,  the  record  was  not 
so  favorable.  accident-Severity 

Rate  (Days  per 
Month  Month) 

October i-^72 

November o-97o 

December o-899 

ijf  anything,  the  rating  adopted  by   the  Safety  Engineering  Section  was 

slightly  more  severe, 

2  This  should  not  be  interpreted  to  mean  that  these  days  were  actually  lost 
during  the  specific  year  or  month.  It  merely  means  that  accidents  which 
occurred  during  this  time  caused  either  during  that  year  or  in  future  years  a 
loss  of  this  amount  of  time.  For  instance,  Dr.  Chaney  rates  a  death  as  9000 
working-days.  Thus  the  loss  of  time  due  to  this  accident  would  be  spread  over 
thirty  years. 


332       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Although  more  detailed  statistics  are  not  available  for  months  since 
December,  19 18,  the  facts  at  hand  seem  to  indicate  that  there  has  been 
a  somewhat  steady  decrease  in  the  frequency  and  severity  of  accidents. 
It  seems  probable  that,  as  a  result  of  safety  measures,  from  12,000  to 
13,000  fewer  accidents  occurred  during  the  last  quarter  of  1918  alone 
than  would  have  occurred  had  the  pre-war  conditions  existed.^  Such  a 
showing  is  all  the  more  remarkable  when  the  sudden  expansion  of  the 
industry  and  the  addition  of  nearly  300,000  "green  men"  is  considered. 

The  reduction  of  accidents  effected  by  the  Fleet  Corporation,  how- 
ever, not  only  saved  many  lives  and  much  human  loss  but  also 
materially  reduced  the  labor  cost  to  shipbuilding  companies  and  thus 
to  the  Fleet  Corporation.  Sixty-nine  shipbuilding  companies  were 
enabled  to  secure  a  reduction  in  their  insurance  premium  because  of 
the  safety  measures  introduced  at  the  instance  of  the  Safety  En- 
gineering Section.  This  reduction  totaled  in  all  several  millions 
of  dollars.- 

IX.    The  Instability  of  Labor 
Table  III  shows  the  labor  turnover  from  January  to  September, 
1918,  for  90   representative  companies,   which   in   September  em-' 
ployed  273,632  shipbuilders.    The  table  shows  the  following: 

I.  That  the  turnover  for  the  country  as  a  whole  was  at  an  annual 
rate  of  over  200  per  cent  in  practically  every  month.    In  some  months 

'  While  reading  the  proof  of  this  article,  a  further  study  by  Dr    Chaney  ap- 
peared which  affords  a  basis  for  further  comparison.    Dr.  Chaney,  after  a  study 
of  the  191 7  accident  rates  in  several  long-established  shipyards,  finds  that,  though 
the  accident-frequency   rates   decreased   from    217.8    for  every    1000   full-time 
workers  per  year  as  in  1912  to  60.9  in  1917,  the  accident-severity  rates  increased 
from  6.6  to  10.8.     It  is  probable  that  the  newly  established  yards  had  a  much 
higher  frequency   rate  in   191 7  and   the  early   part  of   1918   than   these  long- 
estabhshed  yards  and  that  their  accident-severity  rate  was  as  high  if  not  hi-her 
The  work  of  the  Safety  Engineering  Section,  therefore,  appears  to  be  even  more 
effective  than  indicated  above  as  respects  the  decrease  in  the  severity  of  acci- 
dents, although  it  is  possible  that  its  influence  in  causing  a  decline  in  the  fre 
quency  of  accidents  was  not  as  great  as  might  be  expected  from  the  1912  figures 
For  the  later  study  of  Chaney 's,  see  U.  S.  Bureau  of  Labor  Statistics,  Monthly 
Labor  Review,  Vol.  VIII,  No.  4  (1919),  p.  16. 

2  As  has  been  explained,  the  increased  labor  cost  caused  by  the  decisions  of 
the  Adjustment  Board  was  ultimately  paid  for  by  the  Fleet  Corporation  The 
mcrease  m  wages  necessitated  a  consequent  increase  in  insurance  premiums 
which  was  chargeable  against  the  Fleet  Corporation.  A  reduction  of  the  insur- 
ance premium,  therefore,  decreased  the  amount  which  the  Fleet  Corporation  was 
compelled  to  reimburse. 


SHIPYARD  LABOR  ADMINISTRATION 


333 


it  was  as  high  as  30c  per  cent.    In  other  words,  it  was  necessary  to 
hire  from  three  to  four  men  in  a  year  in  order  to  increase  the  working 

force  by  one.^ 

2.  The  turnover  for  wood-ship  yards  was  slightly  less  than  that 

for  steel  yards. 

3.  The  turnover  for  the  three  fabricating  yards  ^  was  the  highest  of 
all  types  of  construction,  averaging  447  per  cent  for  the  nine  months. 

4.  The  turnover  was  heaviest  in  the  Pacific  Coast  yards  and  those 
north  of  Chesapeake  Bay,  while  it  was  lightest  in  the  yards  of  the 
Great  Lakes  and  those  of  the  ]\Iiddle  Atlantic  district  (Chesapeake 
Bay  to  Wilmington,  North  Carolina).  It  is  not  an  accident  that  the 
districts  where  the  turnover  was  the  heaviest  were  those  where  there 
had  been  the  greatest  violation  of  the  Macy  scale  and  the  heaviest 
competitive  bidding  for  labor  by  the  shipyards. 

5.  The  turnover  was  lightest  in  the  winter  months  and  increased 
during  the  late  spring,  summer,  and  fall.  It  is  difficult  to  tell  whether 
this  was  purely  a  seasonal  variation  or  whether  it  was  due  to  the 
competitive  bidding  for  labor  in  excess  of  the  established  scale.  This 
latter  factor  made  the  situation  worse  as  time  went  on.^ 

iThe  method  of  calculating  the  labor  turnover  was  as  follows:  The  number 
of  shipbuilding  employees  on  the  pay  roll  for  each  week  during  each  month 
was  added,  and  the  sum  was  divided  by  the  number  of  weeks  in  the  month. 
This  method  secured  the  average  number  on  the  pay  roll.  The  average  number 
of  shipbuilding  employees  on  the  pay  roll  was  divided  into  the  number  of  ship- 
building employees  replaced  during  the  month,  giving  the  turnover  percentage 
for  the  month.  The  monthly  turnover  percentage  was  reduced  to  a  yearly  basis 
for  purposes  of  uniform  comparison  by  multiplying  the  monthly  percentage  by 
the  factor  10.4  (that  is,  25  divided  by  5)  when  five  weeks  were  included  in  the 
month,  and  by  13  (that  is,  52  divided  by  4)  when  four  weeks  were  included  in 
the  month.  When  the  pay  roll  was  increasing,  the  number  of  men  replaced 
would  be  the  number  lost  from  the  pay  rpll  (in  operations),  while  when  the 
pay  roll  decreased  the  number  of  men  replaced  would  be  the  total  number  hired. 

2  Fabricating  yards  are  so  termed  because  there  is  no  fabricating  done  at 
them  !  The  parts  are  prepared  at  various  other  plants  and  shipped  to  these 
yards,  where  they  are  assembled.    The  term  "assembling  yards"  would  be  much 

more  accurate. 

3  Dr.  Boris  Emmet's  study  in  an  automobile  establishment  indicates  that  the 
labor  turnover  in  that  plant  uniformly  increased  during  the  spring  and  summer 
months  and  decreased  during  the  winter.  This  may  be  due  to  the  greater  preva- 
lence of  employment  during  the  summer  months,  which  entices  workmen  from 
job  to  job,  while  in  the  winter  they  feel  that  they  should  hold  on  to  whatever 
jobs  they  have.  See  "Labor  Turnover  and  Employment  Policies  of  a  Large 
Motor  Vehicle  Manufacturing  Establishment,"  U.  S.  Bureau  of  Labor  Statistics, 
Monthly  Labor  Review,  Vol.  VII,  No.  4  (1918),  pp.  1-18. 


i 


334      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Table  III 

Turnover  Percentages  for  Shipbuilding  Employees 

(Yearly  Basis) 


Districts 


North  Atlantic 
Delaware  River 
Middle  Atlantic 
Southern 
Gulf 

Great  Lakes 
North  Pacific 
No.  II 

South  Pacific 
Fabricating  yards 
All  districts 


North  Atlantic 
Delaware  River 
Middle  Atlantic 
Southern 
Gulf 

Great  Lakes 
North  Pacific 
No.  II 

South  Pacific 
Fabricating  Yards 
.    All  districts 


No.  OF 

Yards 

REPORT- 
ING 

Every 
Month 


> 

< 

z 

< 


> 

X 

< 

D 
OS 
SQ 
U 


Z 
u 

X 

< 


a. 


< 


z 

D 


X 
Ul 

n 
S 

H 


CD 


H 

h 
X 

X  Qf 


X 

u 

z  < 

o  ^ 

yo 


h 
X  :j 


X 
H 
Z 

HI    O 

2S 


Steel-Ship  Yards 


7 
6 
2 

4 

M 

8 


202 
189 
lit 
176 

219 
184 


165 
304 
112 

212 


178 

195 

168 

170 

196 

146 

153 

183 

199 

170 

131 

118 

lOI 

140 

190 

134 

143 

134 

168 

160 

243 

22s 

180 

'77 

224 

257 

176 

irk> 

270 

191 

"7 

119 

199 

•74 

>47 

149 

No  steel-ship  building  companies  in  this  district 


199 

233 

192 

181 

138 

190 

196 

205 

214 

234 

276 

374 

362 

407 

369 

332 

313 

229 

168 

380 


No  steel-ship  building  companies  in  this  district 


219 
214 

218 
»75 

'95 
340 


'94 
'93 
'S8 
163 

190 
32' 


Description  of  districts:  North  Atlantic— all  yards  north  of  Newark  New 
Jersey;  Delaware  River— all  yards  on  Delaware  River;  Middle  Atlantic— all 
yards  on  Chesapeake  Bay,  Potomac  River,  and  Atlantic  Coast  from  Baltimore, 
Maryland,  to  Wilmmgton,  North  Carolina;  Southern  — all  yards  from  Wilmine- 
lon,  North  Carolina,  to  Mississippi  River;  Gulf-yards  west  of  Mississippi  on 
the  Gulf;  Great  Lakes— all  yards  on  Great  Lakes;  North  Pacific— all  wood- 
ship  yards  m  Washmgton  save  those  on  the  Columbia  River  (which  are  in 
District  II)  and  all  steel-ship  yards  in  Washington  and  Oregon;  District  11  — 
all  wood-ship  yards  in  Oregon  and  on  Columbia  River,  save  those  of  Coos 
Uay ;  bouth  Pacific— all  California  yards  and  those  of  Coos  Bay,  Oregon. 

Turnover  is  not  the  only  factor  in  the  instability  of  labor.  Though 
absenteeism  is  often  confused  with  turnover,  it  is  really  a  separate 
item.    Absenteeism  differs  from  turnover  in  that   while  turnover 


SHIPYARD  LABOR  ADMINISTRATION  335 

represents  a  changing  of  positions,  absenteeism  represents  the  ab- 
sence from  a  position  while  one  is  employed. 

Table  IV  shows  the  percentage  of  attendance  of  all  employees  (not 
shipbuilders  alone)  in  90  representative  companies.  These  com- 
panies employed  over  320,000  workmen  in  September,  1918.^ 


Table  IV.  Average  Percentage  of  Pay  Roll  in  Daily  Attendance 

FOR  All  Employees 


No.  OF 



Vakds 

X 

X 

X 

X 

Districts 

Report- 

> 

X 

a: 
< 

a 

E 

a  X 

Y    < 

2 

. 

ing 
Every 

< 

3 

X 

ca 

u 

X 

< 

X 

> 
< 

z 

5 

5 

6. 

C    3 

X    3 

aa  0 

Month 

< 

W4 

< 

<, 

•-> 

<i 

in 

b 

C/3 

H 

z 

Steel-Ship  Yards 

North  Atlantic 

7         ' 

37.q 

68.0 

71.0 

73-0 

78.1 

79.1 

79-7 

83-3     78.3 

69.0 

77 -o 

80.4 

76.3 

Delaware  River 

6 

73-8 

78.5 

84.7 

85-4 

84.2 

86.8 

84.0 

85.7     81.2 

79.1 

85-4 

83.6 

83.1 

Middle  Atlantic 

2 

64.. 

72.1 

77.1 

76.4 

78.7 

82.3 

77.2 

74.6    80.2 

71-3 

79-3 

77-3 

76.5 

Southern 

4 

89.1 

89.4 

84.6 

80.5 

84.6 

84.1 

86.3 

86.4    85.9 

87.3 

83-4 

86.2 

85-5 

Gulf 

No  steel-ship  building  companies  in  this  district 

Great  Lakes 

14 

77.0 

79-4 

83.1 

84.5 

83.7 

88.8 

86.0 

86.5 

83.8 

79-9 

85.6 

85.4 

84.2 

North  Pacific 

8 

92.4 

89.5 

88.2 

88.9 

89-5 

87-7 

85.1 

85.6 

83-3 

90.1 

88.7 

84.7 

87.6 

No.  II 

No  steel-ship  building  companies  in  this  district 

South  Pacific 

4 

909 

88.1 

87.9 

88.8 

90.5 

92.5   88.8 

94.0 

82.5 

88.7  90.7 

88.4 

89-3 

Fabricating  yards 

3 

61.5 
74.0 

73-5 

78.3 

77-4 
81.1 

73-9 
Si.o 

82.2 
84.0 

87.2   83.4 

80.3 

84.8 

82.2 

S1.7 

69.8  81.5 
77.7  84.0 

82.0 
83-5 

78.4 

82.2 

All  districts 

48 

86.6 

83-9 

Wood-ship  Yards 

North  Atlantic 

12 

79-3 

76.7 1 83.1    84.0   86.2    87.8   86.8     88.6    80.5    80.0     86.3 

85-5 

84.9 

Delaware  River 

No  wood-ship  building  companies  in  this  district 

Middle  Atlantic 

2 

69.0 

77.1 

76.5 

74-7 

79.1 

79-9 

78.1 

83-8 

79.2 

74-3 

78.6 

80.0 

78.7 

Southern 

4 

78.2 

79.0 

83.8 

80.7 

79-9 

86.4 

80.1 

81.4 

77-9 

80.6 

82.6 

79-7 

80.9 

Gulf 

5 

74.0 

80.4 

82.8 

85.0 

83-7 

80.5 

80.0 

78.4 

77.8 

79-5 

83-1 

78.8 

80.6 

Great  Lakes 

I 

S1.4 

74.2 

95-3 

92.6 

85.9 

89.7 

98.3 

loo.o 

99-7 

82.5 

89.2 

99-2 
91.8 

88.6 
91.6 
91.6 

North  Pacific 

6 

90.7 

89.0 

90.1 

90.5 

93 -o 

92.7 

91. 1 

94-3 

90.4 

.^9.9 

923 

No.  II 

7 

91.9 

90.9 

90.7 

91.4 

91.7 

92.5 

89.3 

93-3   92-4;  91-1 

91.9 

91-5 

South  Pacific 

5 

90.2 

87.2 

89.1  1  90.1 193-2  194-2  192-7 

1    95.1  I92.6    88.9 

92.6 

93-4 

92.0 

Fabricating  yards 

No  wood-ship  building  companies  in  this  district 

All  districts 

42 

84.7 

84.1  86.8 

87.2 

87.S 

!   88.6 

86.5 

88.7 

84.8 

85.3 

87.9 

86.6 

86.8 

iThe  method  of  computing  attendance  figures  was  as  follows:  The  average 
daily  attendance  for  each  week  is  calculated  by  adding  the  attendance  for  all 
the  davs  of  the  week  save  Sunday,  and  dividing  by  6.  The  ratio  of  this  average 
daily  attendance  to  the  total  number  on  the  pay  roll  expressed  m  percentage 
gives  the  average  attendance.  The  difference  between  this  and  100  per  cent  is 
the  amount  of  absenteeism  for  the  week.   To  reduce  this  to  a  monthly  basis, 


f*' 


336       TRADE  UNIONISM  AND  LABOR  PROBLExMS 

It  must  be  clearly  realized  that  this  percentage  of  absenteeism 
merely  measures  the  number  of  full  days  lost.    It  does  not  include 
absenteeism  resulting  from  (i)  half-days  absent  and  (2)  tardiness 
The  real  amount  of  absenteeism,  therefore,  is  probably  greater  than 
that  mdicated  by  the  statistics  given. 

The  following  facts  appear  from  Table  IV  : 

I.  That  the  percentage  of  days  lost  per  month  for  the  country  as 
a  whole  ranged  in  steel-ship  yards  from  26  to  13.3  per  cent  and  in 
wood-ship  yards  from  15.9  to  ii.4percent.  The  average  absenteeism 
for  the  nine  months  in  the  steel-ship  yards  was  17.8  per  cent  •  in 
the  wood-ship  yards,  13.2  per  cent. 

2  That  absenteeism  was  approximately  25  per  cent  less  in  the 
wood-ship  yards  than  in  the  steel-ship  yards. 

3.  That  absenteeism  was  higher  in  the  winter  months  than  in  the 
spring  and  summer.    This  was  particularly  true  of  the  steel  yards 
Climatic  reasons  were  undoubtedly  a  large  factor. 

4.  That  absenteeism  is  highest  in  the  yards  of  the  Northern  At- 
lantic States  and  lowest  in  those  of  the  Pacific  Coast.  Here  again  it 
IS  probable  that  the  equable  temperature  of  the  Pacific  Coast  was 
responsible  in  a  large  part  for  the  better  showing  made  by  these  yards. 

EVALUATION  OF  RESULTS 

I.  Principles  Underlying  the  Labor  Policy  of  the  Fleet 

Corporation 

Had  the  managers  of  the  Fleet  Corporation  been  asked,  "What  is 
the  philosophy  upon  which  your  rulings  and  policies  are  based?" 
they  w^ould  probably  have  replied,  "We  have  none.  We  are  here  *to 
build  ships.  Speed  was  their  aim.  They  wanted  results.  The  multi- 
tude of  questions  that  poured  in  upon  them  were  decided,  therefore 
m  the  light  of  this  purpose  and  not  by  a  priori  theories.    From  the 

LTar'are  "eated'af fn  Th^'T  "  'f  ^"^''  "'^^^^^  ^^^  ^^^^^  ^--^ 
weeU  t  J  K  ?  ^"cJ^dmg  five  weeks  and  eight  months  as  including  four 
weeks,  the  aim  being  to  make  the  weekly  periods  and  the  monthly  periods  cob 
cide  as  evenly  as  possible.  The  percentage  of  attendance  for  the  elective 
number  of  weeks  m  the  month  is  added,  and  is  then  divided  by  the  number 
of  weeks,  which  gives  the  average  attendance  for  the  month 


I'' 


SHIPYARD  LABOR  ADMINISTRATION 


337 


accumulation  of  their  decisions,  however,  the  student  can  detect  cer- 
tain fundamental  principles  being  crystallized  and  an  inductive 
industrial  philosophy  being  formed,  of  which  the  promulgators  them- 
selves were  almost  unconscious. 

There  were  really  two  basic  principles  upon  which  the  labor  policy 
was  based,  the  implications  of  which  were  perhaps  grasped  by  only 
a  few  :  ( i )  The  first  of  these  was  that  the  hearty  support  and  cooper- 
ation of  labor  was  necessary  to  attain  any  modicum  of  success. 
( 2 )  The  second  was  that  the  ordinary  peace-time  method  of  competi- 
tion between  shipyards  was  not  only  inadequate  to  build  the  neces- 
sary ships  under  war  conditions  but  was,  on  the  whole,  an  actual 
impediment. 

Shipbuilding  in  war  time  demonstrated  the  importance  of  the 
worker.  It  was  possible  in  peace  time,  with  the  plentiful  labor  supply, 
to  take  less  account  of  labor,  but  it  was  impossible  in  war,  for  the 
success  of  the  whole  program  depended  largely  upon  the  zeal  and 
efficiency  of  the  laboring  men.  The  Fleet  Corporation  could  not  wash 
its  hands  of  its  labor  problem  by  delegating  its  responsibility  to  its 
contractors,  and  could  secure  the  cooperation  of  labor  not  by  auto- 
cratic commands  but  only  by  taking  the  workers  into  its  confidence 
and  by  jointly  sharing  with  them  the  settlement  of  their  problems. 
The  creation  of  the  Shipbuilding  Labor  Adjustment  Board  was  the 
most  important  recognition  of  this  truth  which  any  great  industry 
in  America  has  ever  made,  and  throughout  the  administration  of 
labor  matters  by  the  Fleet  Corporation  it  was  found  absolutely  essen- 
tial to  secure  the  cooperation  of  the  workers  themselves.  Many  of 
the  charges  that  the  workmen  have  been  "coddled"  come  from 
those  who  do  not  understand  the  significance  of  labor  which  the  war 
has  revealed.  Such  statements  are  based  upon  the  implicit  belief  that 
the  workers  should  do  what  is  ordered  by  economically  stronger 
classes  and  that  they  should  be  servants  of  the  state  but  not  members 
of  the  state. 

The  other  basic  principle,  namely,  the  supplementing  and  restrain- 
ing of  competition,  did  not  manifest  itself  so  quickly,  but  it  emerged 
after  a  time  as  a  necessity. 

It  was  necessary  to  supplement  competition,  because  the  work  per- 
formed by  the  Education  and  Training,  the  Safety  Engineering,  and 
the  Health  and  Sanitation  sections,  together  with  the  Employment 


4*. 

if 


ii! 

Ill 


^1 


33^      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Management  Branch  and  other  agencies  of  the  Corporation,  would 
never  have  been  performed  by  the  shipbuilders  themselves,  for  the 
following  reasons : 

I.  While  it  was  for  the  interest  of  the  industry  as  a  whole  that 
these  facilities  should  be  provided,  it  need  not  have  been  for  the 
interest  of  any  particular  yard  to  perform  these  functions.    If  an 
employer,  for  instance,  provided  training  for  his  men  at  his  own 
expense,  there  was  every  likelihood  that  some  other  shipyard  which 
had  not  undergone  the  expense  of  training  men  would  offer  these 
men,  once  trained,  more  than  their  original  emplover  could  pay  and 
would  thus  entice  them  away.    The  offering  of  these  advantages  by 
a  central  agency,  such  as  the  Fleet  Corporation,  however,  relieved 
any  individual  yard  of  the  burden  and  extended  these  facilities  to 
the  industry  as  a  whole.    Though  the  movement  of  newly  trained  men 
from  yard  to  yard  still  continued,  nevertheless  the  industry  as  a  whole 
possessed  these  trained  workmen,  a  gain  which  would  hardly  have 
materialized  had  the  Fleet  Corporation  depended  upon  the  initiative 
of  mdividual  employers  to  furnish  them. 

2.  It  was  necessary  for  the  Fleet  Corporation  to  provide  these 
services  not  only  because  it  was  not  to  the  economic  interest  of 
mdividual  shipyards  but  also  because  of  the  ignorance  on  the  part 
of  many  shipbuilders  of  what  was  actually  to  their  economic  interest 
It  was  not  easy  for  the  owners  to  understand  that  good  health 
safety  measures,  and  efficient  employment  methods  meant  an  in-' 
creased  output.  The  Industrial  Relations  Division  performed  valu- 
able educational  work  in  impressing  the  necessity  for  these  measures 
upon  indifferent  and  even  hostile  concerns. 

3.  By  reason  of  the  nation-wide  extent  of  the  organization  im- 
provements in  matters  relating  to  labor  could  be  pooled  and  'then 
quickly  extended  to  all  other  plants  instead  of  being  confined  to  a 
few.  Illustrations  of  this  can  be  drawn  from  such  diverse  items  as 
the  invention  of  an  appliance  which  lessened  the  vibration  in  riveting 
methods  of  managing  plant  cafeterias,  and  a  plan  devised  by  one 
district  representative  of  organizing  shop  committees. 

The  officials  of  the  Corporation  slowly  learned,  moreover  that 
competition  must  be  restrained  as  well  as  supplemented.  This  was 
first  learned  in  the  supplying  of  raw  material  to  the  shipyards  It  was 
necessary  to  centralize  the  purchasing  and  distribution  of  steel    of 


Shipyard  labor  administration 


339 


lumber,  and  of  other  materials,  because  each  plant  tried  to  "play 
safe"  and  accumulated  more  than  it  needed.  Some  yards  were  con- 
sequently unable  to  get  the  raw  materials  that  they  needed.  It  be- 
came almost  equally  necessary  to  restrain  the  competitive  methods 
of  attracting  labor.  The  treating  of  the  Macy  rates  as  maxima  as 
well  as  minima  was  only  one  step  in  the  attempt  to  prevent  firms 
from  enticing  labor  from  other  shipyards.  The  Corporation  expressly 
forbade  a  concern  to  take  men  intentionally  from  other  yards,  it  used 
all  its  influence  to  punish  yards  which  had  so  offended,  and  it  tried 
to  bring  about  the  return  of  the  men  who  had  been  enticed  away. 

In  the  fall  of  19 18  the  Corporation  found  it  necessary  to  regulate 
advertising  for  labor,  which  many  concerns  were  conducting  in- 
judiciously, and  it  issued  a  General  Order  regulating  advertising, 
which  is  perhaps  unique.  By  it  shipyards  were  forbidden  to  state 
any  special  advantages  in  the  form  of  wages  or  working  conditions 
and  were  required  to  state  that  they  would  not  employ  anyone 
working  in  another  shipyard.^ 


3}| 


II.    Defects  and  Merits 

So  great  was  the  necessity  for  haste  that  it  is  small  wonder  mistakes 
were  made  in  building  up  from  nothing  a  system  of  labor  administra- 
tion and  control.  Rather  is  it  remarkable  that  the  mistakes  were 
upon  the  whole  so  few,  and  that  the  conspicuous  merits  far  out- 
weighed them  ;  but  both  mistakes  and  merits  alike  are  of  distinct 
service  in  pointing  out  what  labor  policy  a  nation  should  pursue  in 
war  time  and  in  peace  time  as  well. 

Among  the  most  important  defects  were : 

I.  Delay  in  setting  up  an  adequate  administrative  machinery  to 
enforce  the  rates  authorized  by  the  Shipbuilding  Labor  Adjustment 
Board.     It  is  perhaps  an  American  characteristic  to  enunciate  a 

1  The  restrictions  imposed  were  as  follows : 

1.  Every  advertisement,  whether  for  skilled  or  unskilled  labor,  must  contain 
the  following  statements:  "No  one  working  in  an  Emergency  Fleet  Shipyard 
should  apply.  Wages  and  working  conditions  arc  the  same  in  all  such  shipyards." 

2.  No  advertisement,  whether  for  skilled  or  unskilled  labor,  shall  state 
(fl)  number  of  men  needed;  {b)  rate  of  pay;  (c)  the  amount  of  overtime  or 
rate  of  compensation  for  overtime;  {d)  housing,  welfare  work,  or  similar  in- 
ducements; {e)  inducements  in  violation  of  the  wages  and  standards  fixed  by 
the  Shipbuilding  Labor  Adjustment  Board. 


340      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

policy  and  then  neglect  to  provide  machinery  to  see  that  it  is  carried 
out.  The  Fleet  Corporation  and  the  Adjustment  Board  shared  in  this 
American  vice.  A  more  thorough  organization  with  several  full-time 
men  in  each  district  should  have  been  created  early.  The  Corporation 
was  relatively  slow  to  realize  the  necessity  for  a  separate  system  of 
labor  control  with  administrative  decentralization.  Had  this  been 
in  existence  earlier,  the  violations,  both  those  above  and  those  below 
the  Macy  rates,  would  have  been  fewer. 

2.  A  rather  loosely  administered  system  oj  reimbursement  for 
added  labor  cost.  There  can  be  little  question  that  many  yards  were 
reimbursed,  temporarily  at  least,  for  amounts  in  excess  of  the  actual 
Macy  scale.  This  was  partially  caused  by  a  shortage  of  competent  ac- 
countants, which  rendered  the  work  of  detecting  these  amounts  more 
difficult,  and  the  necessity  for  training  more  and  better  accountants 
was  thereby  sharply  emphasized. 

3.  A  too  liberal  contract  system.  Though  the  contracts  for  the 
Fleet  Corporation  probably  protected  the  government  more  than 
those  of  other  government  departments,  yet  many  were  unduly  fa- 
vorable to  the  contractor.  The  cost-plus-percentage  contracts,  the 
number  of  which  became  fewer  as  time  went  on,  directly  encouraged 
extravagance  in  labor  matters  upon  the  part  of  the  contractor,  while 
the  cost-plus-fixed-fee  contracts  and  agency  contracts,  where  the 
Fleet  Corporation  bore  all  the  expense,  did  not  sufficiently  discourage 
such  extravagance.  Costs  were  often  unduly  swollen,  and  an  ex- 
travagant attitude  was  created  toward  labor  matters. 

4.  Failure  to  provide  an  adequate  labor-requirements  machinery. 
The  Fleet  Corporation  should  have  established  relatively  early  a 
staff  to  estimate  the  labor  requirements  of  the  various  yards  and 
the  country  as  a  whole,  concerning  the  number  and  kinds  of  men 
needed  at  varying  periods  of  time.  This  should  have  been  roughly 
computed  from  the  estimated  production  program  as  it  varied, 
although  the  uncertainties  in  the  program  would  have  rendered  the 
work  exceedingly  difficult.  Such  estimates  could  have  been  checked 
up  by  estimates  from  the  yards  themselves.  This  system  would  have 
furnished  the  United  States  Employment  Service  with  an  accurate 
list  of  labor  requirements  and  would  have  guided  the  various  activ- 
ities of  the  Corporation,  as,  for  instance,  the  Education  and  Training 
Section  and  other  sections.    Had  such  a  section  been  in  existence  the 


SHIPYARD  LABOR  ADMINISTRATION 


341 


Shipyard  Volunteers'  fiasco  might  have  been  avoided.  It  is  only  fair, 
however,  to  say  that  such  a  centralized  system  of  labor  requirements 
had  never  been  created  in  the  country,  and  it  is  not  wholly  proper 
to  reproach  the  officials  of  the  Corporation  for  having  failed  to  create 
such  machinery  de  novo. 

5.  Failure  to  acquaint  all  groups  with  the  real  policy  of  the  Fleet 
Corporation  and  Adjustment  Board.  In  a  country  as  large  as  the 
United  States  the  cooperation  of  all  parties  cannot  be  obtained 
merely  by  the  action  of  committees  representing  both  sides.  It  is 
vitally  important  to  educate  and  inform  the  rank  and  file  of  both 
employers  and  employees  as  to  the  reasons  for  and  necessity  of  the 
policies  and  methods  adopted. 

The  fundamental  merits  of  the  work  must  also  be  remembered, 

however : 

1.  The  necessity  of  recognizing  the  principle  of  collective  bargain- 
ing and  of  granting  labor  a  voice  in  the  determination  of  its  own 
conditions  was  demonstrated  beyond  a  doubt. 

2.  For  the  first  time  a  great  government  industry  realized  the 
necessity  for  a  separate  and  coordinate  organization  to  deal  with 

labor  problems. 

3.  It  was  shown  that  industrial  disputes  not  only  should  be  settled 
after  the  fact  but  should  be  headed  off  by  a  thorough  examination 
into  and  removal  of  the  basic  causes  of  labor  unrest.  Not  only  did 
this  policy  prevent  interruption  in  production  but  it  increased  the 
efficiency  of  the  men  while  at  work. 

4.  The  industry  was  viewed  as  a  whole,  and  measures  were  taken 
to  supply  the  needs  of  all  plants,  instead  of  depending  upon  the 
self-interest  of  the  individual  contractor  to  furnish  the  services  for 

the  industry. 

5.  The  principle  of  basing  wages  upon  increase  in  the  cost  of  living 
was  officially  recognized  and  applied  throughout  an  important  in- 
dustry. Whatever  may  be  the  inadequacies  in  merely  maintaining 
the  status  quo  of  a  standard  of  living  which  may  have  originally  been 
too  low,  there  can  be  no  question  that  it  was  a  big  improvement  over 
what  would  have  happened  had  the  market  system  of  adjusting  wages 
been  followed,  with  all  its  accompanying  friction.  Had  not  the  Fleet 
Corporation  interposed,  there  is  little  doubt  that  the  standard  of 
living,  instead  of  being  maintained,  would  have  been  impaired. 


342       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

6.  During  the  period  after  the  Shipbuilding  Labor  Adjustment 
Board  and  the  Industrial  Relations  Division  were  functioning  and 
pnor  to  the  signing  of  the  armistice,  there  were  no  strikes  or  lockouts 
save  of  momentary  character,  in  yards  doing  work  for  the  Fleet 
Corporation.'     Industrial  peace  was   thus  roughly  attained     This 
should  not  be  understood  to  mean  that  there  were  no  rumblings  of 
discontent,  but  merely  that  no  actual  interference  with  production 
occurred  during  hostilities.    When  the  temper  of  both  employers  and 
workmen  is  considered,  this  is  perhaps  the  most  outstanding  proof  of 
the  success  of  the  efforts  of  the  shipyard  labor  administration    There 
can  be  little  question  that  had  it  not  been  for  the  Labor  Adjustment 
Board  and  the  Industrial  Relations  Division  the  tonnage  built  would 
have  been  less  by  several  hundred  thousand  tons 


*;■ 


THE   FUTURE 

The  Shipbuilding  Labor  Adjustment  Board,  though  its  duration 
was  not  limited  by  either  of  the  memoranda  creating  it,  was  dissolved 
on  April  I.    During  the  months  of  February  and  March  many  efforts 
were  made  to  devise  some  machinery  to  take  its  place.    The  peace- 
time problem  is  naturally  different  from  that  of  war    if  for  no 
other  reason  than  that  the  shipyards  will  soon  be  producing  pri- 
marily for  private  and  not  for  government  account.    By  July  i  of 
this  year  the  wood-ship  yards  will  be  practically  through  with  Fleet 
Corporation  work,  while  30  per  cent  of  the  steel-ship  yards  formerly 
occupied  on  government  work  will  be  freed  for  private  construe- 
tion.    By  December,  1919,  over  60  per  cent  of  the  steel-ship  ways 
will  so  be  free.=  ^       -^ 

The  Emergency  Fleet  Corporation  therefore  could  no  longer  nre- 

thTl?  'tV'J'k  ',"."'"'  "  "  '""'  "^^^  ^^^P^'l^d  to  do  during 
the  war.  The  shipbuilders  themselves,  who  had  not  been  parties  to 
the  formation  of  the  Board,  were  the  only  ones  who  could  enter  into 
a  general  agreement  with  the  unions. 

2  The  prohibition  upon  the  buildin^  of  stepl  ^hinc  f/^r  f«^  • 
as  yet  been  rai<«>H   hut  it  ;=  o        I  !:.v.  ^^  ^^^  foreign  account  has  not 

ab  >ei  oeen  raised,  but  it  is  expected  that   t  will  be  very  shortly 


SHIPYARD  LABOR  ADMINISTRATION 


343 


After  a  series  of  conferences  it  seems  to  be  undoubted  that  several 
boards  will  replace  the  Adjustment  Board.  After  a  stormy  two  weeks' 
conference  in  Washington  between  representatives  of  the  local  unions 
and  employers  from  the  Pacific  Coast,  together  with  representatives 
of  the  international  unions  and  the  Fleet  Corporation,  an  agreement 
was  drawn  up  providing  for  the  creation  of  a  board  for  the  Pacific 
Coast  with  ten  members,  with  a  continuation  of  the  principal  con- 
ditions established  by  the  Adjustment  Board,  save  that  the  forty- 
four  hour  week  was  established  for  the  entire  year,  and  not  merely 
for  the  summer  months,  as  at  present.  The  board,  if  constituted, 
will  have  power  over  wages,  hours,  conditions  of  labor,  classification, 
grievances,  etc.  The  local  coast  unions  will  undoubtedly  have  a 
larger  voice  in  representing  labor  on  this  board  than  the  inter- 
national unions,  and  thus  one  cause  of  friction  will  be  removed. 
This  agreement  has  been  approved  by  the  employers  and  will 
be  voted  upon  by  the  local  unions,  by  whom  it  will  undoubtedly 

be  rejected. 

Although  some  employers  on  the  Atlantic  Coast  and  Great  Lakes 
are  refusing  to  sign  collective  agreements  with  the  American  Fed- 
eration of  Labor,  it  is  probable  that  the  vast  majority  of  them  will 
do  so.  The  American  Shipbuilding  Company,  a  concern  with  six 
yards  on  the  Great  Lakes,  has  already  signed  such  an  agreement. 
The  two  agency  yards  of  the  Fleet  Corporation  (the  American  Inter- 
national Shipbuilding  Corporation  at  Hog  Island  and  the  Merchant 
Shipbuilding  Corporation  at  Bristol,  Pennsylvania)  have  also  signed 
such  an  agreement,  as  have  the  various  plants  of  the  Bethlehem 
Shipbuilding  Company.  Many  others  are  about  to  fall  in  line, 
and  it  is  probable  that  from  these  individual  agreements  district 
boards  for  the  Atlantic  Coast  and   Great  Lakes  will  ultimately 

be  built  up. 

Until  some  machinery  is  set  up  and  functioning,  the  Emergency 
Fleet  Corporation  will  maintain  the  rates  and  conditions  of  labor 
established  by  the  Adjustment  Board  and  will  probably  use  these 
rates  as  the  basis  of  reimbursement  for  all  its  contract  settlements, 
although  of  course  yards  may  out  of  their  profits  pay  the  workmen 
more  than  the  scale. 

Whatever  boards  are  set  up  will  be  based  upon  and  will  take  over 
the  principles  and  policies  established  by  the  Labor  Adjustment 


4ti 


344  TRADE  UNIONISM  AND  LABOR  PROBLEMS 
Board  and  the  Industrial  Relations  Division.  Thus  in  this  newest 
of  mdustnes,  perhaps  chiefly  because  of  the  lack  of  long-established 
business  inertia,  the  governmental  policies  evoked  under  the  stress 
of  war-time  pressure  are  to  be  taken  over  as  the  basis  for  future 
peace-time  action.  One,  at  least,  of  war's  gains  is  apparently  to  be 
made  permanent.  rr-  ^  ^ 

P.  H.  Douglas 

Emergency  Fleet  Corporation 

F.  E.  Wolfe 

Ohio  Wesleyan  University 


I 


PART  IV.  LABOR  UNIONS 


XXIV 

TRADE-UNIONS  VERSUS  SHOP  COMMITTEES^ 

AT  THE  Convention  of  the  American  Federation  of  Labor  in 
l\  19 1 8  the  following  resolution  was  adopted  on  the  recom- 
mendation of  the  Executive  Council: 

Betterment  for  wage-earners  under  all  circumstances  depends  upon 
the  control  they  exercise  through  economic  organization.  Control 
brings  with  it  responsibility.  The  right  of  workers  to  a  share  in  the 
results  of  increasing  production,  which  makes  possible  their  advance- 
ment and  reproduction  under  proper  conditions,  means  greater  interest 

in  increasing  output. 

The  Executive  Council  believes  that  in  all  large  permanent  shops 
a  regular  arrangement  should  be  provided  whereby  : 

First,  a  committee  of  the  workers  would  regularly  meet  with  the 
shop  management  to  confer  over  matters  of  production  ;  and  whereby : 

Second,  such  committee  could  carry,  beyond  the  foreman  and  the 
superintendent,  to  the  general  manager  or  to  the  president  any  im- 
portant grievance  which  the  workers  may  have  with  reference  to 
wages,  hours,  and  conditions. 

It  is  fundamental  for  efficiency  in  production  that  the  essentials 
of  team  work  be  understood  and  followed  by  all.  There  must  be 
opportunity  for  intercourse  and  exchange  of  viewpoints  between 
workers  and  managers.  It  is  this  machinery  for  solving  industrial 
problems  that  is  fundamental. 

The  constructive  demands  outlined  above  are  predicated  upon  the 
basic  principle  of  the  right  and  opportunity  of  workers  to  organize 
and  make  collective  agreements.  There  is  no  other  way  to  brmg 
about  cooperation  for  production  except  by  organization  of  workers. 

1  From  Proceedings  of  the  Thirty-eighth  Annual  Convention  of  the  American 
Federation  of  Labor  (1918^,  pp.  85,  329,  330- 

345 


ft 


346       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Organization  is  the  orderly  system  for  dealing  with  questions  which 
concern  labor  in  order  that  decisions  and  adjustments  may  be  reached 
that  further  the  best  interests  of  all  concerned.  Employers  and 
workers  must  talk  over  matters  of  mutual  interest  and  reach  under- 
standmgs.  In  present  large-scale  industry  this  can  be  done  only 
by  the  use  of  the  representative  system,  or  what  is  commonly  called 
collective  bargaining,  which  is  the  foundation  of  all  effective  just 
labor  administration. 

This  was  followed  at  the  Convention  of  1919  by  the  following  •  ^ 
Resolution  No.  2oi--By  request  of  the  National  Committee  for 
Organizmg  the  Iron  and  Steel  Workers. 

Whereas,  Many  steel  corporations  and  other  industrial  institutions 
have  mstituted  in  their  plants  systems  of  collective  bargaining  akin 
to  the  Rockefeller  plan ;  and  «         s 

Whereas,  Extensive  experience  has  shown  that  while  the  employ- 
ers are  busily  carrying  on  propaganda  lauding  these  company  unions 
to  the  skies,  as  a  great  improvement  over  trade-unions,  they  are  at 
the  same  time  just  as  actively  enforcing  a  series  of  vicious  practices 
that  hamstring  such  organizations  and  render  them  useless  to  their 
employees.    Of  these  practices  the  following  are  a  few : 

'•  ^^^^J^t^!5^ifIBM^^  first  essential  for  the 

proper  working  of  a  genuine  collective-bargaining  committee  is  that 
It  be  composed  entirely  as  the  organized  workers  may  elect  and 
altogether  iree  from  the  company's  influence.    Only  then  can  it  be 
truly  representative  of  the  men  and  responsive  to  their  wishes.    Upon 
such  committees  bosses,  representing  as  they  do  the  antagonism  of 
the  company    are  so  much  poison.    Not  only  is  it  impossible  for 
them  personally  to  represent  the  men  but  they  also  negate  the  in- 
fluence of  the  real  workers'  delegates.    Knowing  this  very  well,  the 
steel  companies,  through  campaigns  of  intimidation  and  election  fmud 
load  their  company-union  committees  with  bosses,  usually  to  the 
point  of  a  majority.    So  baneful  is  this  practice  that  were  the  com- 
pany unions  otherwise  perfect  it  alone  could  suffice  to  entirely  destroy 
their  usefulness  to  the  workers. 

2.  Kg  democratic  orpomzation  ^prwiff^^     if  .v  ^  ^        ,    , 

fiiQf  :Jr^r:r— -.^^-5<^^-^^^^^^  ^^  ^^  common  knowledge 

tnat  in  orderToTtne  workri'TTrr^yri^  .u  „       -r  , 

uic  workers  tomrmTat  a  uniform  understanding 


TRADE-UNIONS  VERSUS  SHOP  COMMITTEES      347 

through  the  systematization  and  formulation  of  their  grievances  and 
demands  it  is  necessary  for  them  to  enjoy  and  practice  the  rights 
of  free  speech,  free  assembly,  and  free  association.  They  must  con- 
duct an  elaborate  series  of  meetings  under  their  own  control  and 
generally  carry  on  their  business  in  a  democratic,  organized  way.  But 
with  the  company-union  system  this  is  impossible.  All  independent 
organization  and  meetings  are  prohibited  on  pain  of  discharge.  Conse- 
quently the  workers  are  kept  voiceless  and  destitute  of  a  program. 
They  are  deliberately  held  down  to  the  status  of  a  mob.  Under  such 
circumstances  intelligent,  aggressive  action  by  them  is  out  of  the 
question. 

3.  jMtanjMaiionjJjiimm^  As  part  of  the  general  plan  to 
keep  their  company  unions  from  being  of  any  possible  service  to  their 
employees  it  is  customary  for  the  companies  to  summarily  discharge 
committeemen  who  dare  to  make  a  stand  in  behalf  of  the  workers. 
The  records  show  a  multitude  of  such  cases.  Being  unorganized,  the 
men  are  powerless  to  defend  their  representatives.  The  natural  conse- 
quence is  that  the  committees  soon  degenerate  into  groups  of  men 
supinely  subservient  to  the  wishes  of  the  company  and  deaf  to  those 

of  the  workers. 

4.  Ex^erl^sshtance  projiibtted.  When  dealing  with  their  em- 
ployees in  any  manner,  employers  always  thoroughly  safeguard  them- 
selves by  enlisting  the  aid  of  the  very  best  brains  procurable.  The  only 
way  the  workers  can  cope  with  this  array  of  experts  is  to  have  the 
help  of  experienced  labor  leaders,  but  under  the  company-union 
system  this  is  impossible.  All  association  with  trade-union  officials 
is  strictly  prohibited.  The  company  reserves  to  itself  the  right  to 
expert  assistance.  As  a  result  the  green  workers'  committee,  already 
weakened  in  a  dozen  ways,  is  left  practically  helpless  before  the 
experts  upon  the  company's  side. 

5.  Company  union  lacks^Joi^.  In  establishing  wages,  hours, 
and  working  conditions  in  their  plants  employers  habitually  use 
their  great  economic  power  to  enforce  their  will.  Therefore,  to  secure 
just  treatment  the  only  recourse  for  the  workers  is  to  develop  a 
power  equally  strong  and  to  confront  their  employers  with  it.  Unless 
they  can  do  this  their  case  is  hopeless.  In  this  vital  respect  the 
company  union  is  a  complete  failure.  With  hardly  a  pretense  of 
organization,  unaffiliated  with  other  groups  of  workers  in  the  same 


348       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

industry  destitute  of  funds,  and  unfitted  to  use  the  strike  weapon 
.t  is  totally  unable  to  enforce  its  will,  should  it  by  miracle  have  one 
favorable  to  the  workers.  Weak  and  helpless,  all  it  can  do  is  to 
submit  to  the  dictation  of  the  company.  It  can  make  no  effective 
fight  for  the  men. 

6.  ^ompany  diverts  aim.   As  though  the  foregoing  practices  were 
not  enbUgh  fo  thoroughly  cripple  the  company  unions,  the  employers 
make  assurance  doubly  sure  by  seeing  to  it  that  their  committees 
Ignore  the  vital  needs  of  the  workers  and  confine  themselves  to  minor 
and  e.xtraneous  matters,  such  as  fake  safety-first  movements,  prob- 
kms  of  efficiency,  handing  bouquets  to  high  company  officials,  etc 
Discussions  of  wages,  hours,  and  working  conditions  are  taboo  on  pain 
of  discharge  for  the  committeeman  who  dares  insist  upon  them     Thus 
^e  company  unions  complete  their  record  of  deceit  and  weakness  by 
dodging  the  labor  question  altogether. 

Whekeas,  In  view  of  the  foregoing  facts,  it  is  evident  that  com- 
pany unions  are  unqualified  to  represent  the  interests  of  the  workers 
and  that  they  are  a  delusion  and  a  snare  set  up  by  the  companies  f"; 
the  express  purpose  of  deluding  the  workers  into  the  belief  that 
they  have  some  protection  and  thus  have  no  need  for  trade-union 
organization ;  therefore,  be  it 

uJITI'T'a'^^^'  ^^  disapprove  and  condemn  all  such  company 

anTbetfStrr  ^"^  '"''''"''''  "  ''''  "°"^'"«  ^'^  ^^  ^^^  '^-' 

throu'hT'  ?'t  •  T  f '"'"'   ''^   "■^'"   '°  ''^^Sain   collectivelv 
through  the  only  kind  of  organization  fitted  for  this  purpose- the 


XXV 

TENDENCIES    IN    TRADE-UNION    DEVELOPMENT^ 

A  TRADE-UNION,"  according  to  one  authority,  ''is  a  continuous 
association  of  wage-earners  for  the  purpose  of  maintain- 
ing or  improving  the  conditions  of  their  employment."  ^  A  trade- 
union,  although  usually  including  benevolent  and  fraternal  features, 
is  something  more  than  a  mere  fraternal  order  which  might  easily  be 
a  continuous  association  of  wage-earners.  The  purpose  of  maintain- 
ing or  improving  conditions  of  employment  involves  means  and  ends 
and  a  more  or  less  fixed  policy  which  makes  an  organization  a  trade- 
union.  Trade-unionism  involves  collective  bargaining  as  over  against 
individual  bargaining  for  wages  and  conditions  of  employment  and 
the  use  of  the  strike  as  a  weapon  of  last  resort  in  enforcing  demands. 
A  number  of  American  trade-unions  began  as  mutual  benevolent  and 
fraternal  societies  and  have  become  under  economic  pressure  regular 
labor  organizations.  A  similar  development  is  now  going  on  in  a 
number  of  organizations  resembling  in  some  respects  trade-unions, 
and  it  is  the  purpose  of  this  paper  to  show  if  possible  by  the  study  of 
concrete  instances  the  trend  of  this  development. 

The  dividing  line  between  fraternal  or  beneficiary  organizations 
and  trade-unions  seems  to  lie  in  the  matter  of  collective  bargaining 
and  in  the  attitude  towards  strikes.  The  National  Association  of 
Stationary  Engineers,  for  example,  which  was  organized  in  1882,  lays 
stress  upon  educational  and  beneficiary  features  and  declares  that 
"this  Association  shall  at  no  time  be  used  for  the  furtherance  of 
strikes,  or  for  the  purpose  of  interfering  in  any  way  between  its 
members  and  their  employers  as  to  wages."  ^  Strikes,  moreover,  it  is 
urged,  are  unnecessary  because  of  the  identity  of  interest  between 

iFrom   Quarterly  Journal,  University   of  North  Dakota,  Vol.   IX    (i9i9)> 
pp.  16Q-180. 

2 Sidney  and  Beatrice  Webb,  History  of  Trade  Unionism,  p.  i.   1902. 

^The   National   Engineer,   February,    1904,    p.    34;    Preamble,    Constitution 
(1914),  p. 3. 

349 


350       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

employer  and  employee.  To  this  the  trade-unionist  would  say  that 
educational  and  beneficiary  features  are  useful,  and  that  there  is  an 
identity  of  interest  up  to  a  certain  point,  but  that  without  collective 
bargammg  it  is  impossible  to  utilize  the  legitimate  power  of  com- 
bination that  comes  with  trade-union  organization.  Moreover,  col- 
lective bargaining  would  be  the  rule,  and  strikes  would  be  abolished, 
as  soon  as  an  industry  should  become  completely  unionized. 

The  trend  of  present-day  development  may  be  readily  seen  by  an 
examination  of  the  policies  of  various  organizations  which,  on  account 
of  more  or  less  similarity,  may  be  divided  into  the  following  four 
groups:  (i)  organizations  whose  members  are  employed  directly  bv 
the  federal  government;  (2)  unions  formed  of  men  holding  federal 
licenses;  (3)  train-service  organizations  whose  members  are  em- 
ployed on  the  railroads;  and  (4)  a  miscellaneous  group  at  various 
stages  of  development. 

I.   FEDERAL  GOVERNMENT  EMPLOYEES 

In  this  group  are  found  such  organizations  as  the  National  Fed- 
eration of  Post  Office  Clerks,  the  Brotherhood  of  Railway  Postal 
Clerks   the  National  Federation  of  Postal  Employees,  the  Railway 
Mail  Association,  the  National  Association  of  Letter  Carriers    and 
the  United  National  Association  of  Post  Office  Clerks     These  are 
all  fraternal  and  beneficiary  associations  whose  aim  is  to  cooperate 
with  the  postal  department  as  to  classification,  wages,  hours  of  labor 
and  the  upholding  at  all  times  of  civil-service  rules.^    Most  of  these 
organizations  have  developed  into  regular  trade-unions  and  have 
affiliated  with  organized  labor  "despite  Postmaster  General  Burieson's 
known  opposition  and  declaration  concerning  the  menace  in  postal 
unions.  ^ 

The  National  Federation  of  Post  Office  Clerks  is  a  typical  illustra- 
ton  of  he  development  of  postal  unionism.  Beginning  as  merely  a 
fraternal  and  beneficiary  organization,  it  became  a  regular  trade- 
union  primarily  through  need  of  affiliation  with  organized  labor  to 
secure  through  combined  effort  better  working  conditions  and  higher 

^Z-     .     .T''"^  '^^^"'  ^^  ^^"  Federation  is  shown  by  its  being 
affiliated  with  the  American  Federation  of  Labor,  by  the  fact  that  itJ 

1  Constitution,  Letter  Carriers,  1911,  Article  II.  Section  i. 


TRADE-UNION  DEVELOPMENT 


351 


objects  are  the  social  and  economic  advancement  in  every  lawful  way 
of  its  members,  and  by  its  sympathy  with  the  trade-union  movement.^ 
However,  at  its  national  convention  in  191 1  a  resolution  was  adopted 
putting  it  "on  record  as  most  emphatically  opposed  to  strikes  in  the 
postal  service  as  a  means  to  bring  about  the  improvement  of  working 
conditions  in  the  service." ^   A  "Post  Office  Appropriation   Bill," 
passed  in  August,  191 2,  provides  that  membership  in  associations 
like  the  foregoing  "  shall  not  constitute  or  be  cause  for  reduction  in 
rank  or  compensation  or  removal  of  such  person  or  groups  of  persons 
from  said  service,"  provided  they  are  "  not  affiliated  with  any  outside 
organization  imposing  an  obligation  or  duty  upon  them  to  engage  in 
any  strike,  or  proposing  to  assist  them  in  any  strike,  against  the 
United  States."    This,  according  to  President  Nelson,  of  the  National 
Federation,  legalizes  the  right  to  affiliate  with  the  American  Federa- 
tion of  Labor,  because  that  body  does  not  require  any  affiliated  body 
to  strike  nor  does  it  propose  to  help  any  body  in  a  strike  against  the 
United  States.   Legislation  and  not  strikes  is  held  to  be  the  last 
recourse  of  public  employees  in  settlement  of  grievances.^    This  right 
of  organization  carries  with  it  the  further  right  to  petition  and  agi- 
tate for  remedial  legislation,  which  had  been  denied  to  some  extent  by 
the  federal  officials.   The  contention  of  the  union  officials  is  that 
bad  conditions  brought  about  the  organization  of  the  union  and  that 
their  aim  was  amelioration  by  peaceful  methods,  and  so  they  are 
opposed  to  strikes.    "As  a  matter  of  fact,"  said  President  Nelson  to 
a  Congressional  committee,  "in  the  Chicago  post  office  before  our 
union  came  into  existence  we  practically  had  strikes.    The  men  after 
working  fourteen  hours  on  a  stretch  refused  to  work  any  more ;  they 
walked  out  and  deliberately  rang  the  Bundy  clock  and  went  home,-- 
seventy-five  of  them,— and  they  could  not  get  men  to  take  their 
places'"*    In  reality,  these  organizations,  whether  affiliated  or  not 
with  the  American  Federation  of  Labor,  are  in  many  respects  trade- 
unions  and  are  recapitulating— the  eariier  stages  at  least— the  devel- 
opment of  many  regular  trade-unions.   It  should  be  borne  in  mind, 
also,  that  the  government  postal  employees  in  France  went  out  on 

1  Constitution,  1910,  Article  II. 

2 Proceedings,  1911,  p.  37;  The  Union  Postal  Clerk,  January,  1912,  p.  14. 

^The  Union  Postal  Clerk,  August,  1912,  p.  i. 

*Ibid.  December,  191 1,  p.  8. 


i.  . 
I 


It 


352       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

strike  in  1909,  and  the  railroad  employees,  composed  partly  of  gov- 
ernment and  partly  of  private  lines,  in  1910,  and  that  this  latter 
strike  was  broken  only  by  calling  the  men  to  the  colors. 

II.    MEN  HOLDING  FEDERAL  LICENSES 

Here  are  found  such  organizations  as  the  National  Marine  En- 
gineers' Beneficial  Association  and  the  American  Association  of 
Masters,  Mates,  and  Pilots.  Their  members  are  required  to  have  a 
federal  license  to  engage  in  their  calling  and  are  subject  to  govern- 
ment inspection.  The  conduct  of  all  such  licensed  officers  is  subject 
to  investigation  by  the  Local  Board  of  Inspectors,  which  has  power 
to  suspend  or  revoke  licenses.  Section  4449  of  the  Revised  Statutes 
ot  the  Lnited  States  reads: 

If  any  licensed  officer  shall,  to  the  hindrance  of  commerce  wrone- 
ully  or  unreasonably  refuse  to  serve  in  his  official  capacity  on  any 
steamer  as  authorized  by  the  terms  of  his  certificate  of  license   0^ 
shall  fail  to  deliver  to  the  applicant  for  such  service  at  the  time  o 

asstn?nf  1.  '^VZ  '^'''  ^'  "''"''"'"''  ^  ^'^tement  in  Zing 
assigning  good  and  sufficient  reasons  therefor,  or  if  any  pilot  or 

person  whom  the  master  or  owner  of  the  vessel  may  desire  to  place 
there  for  the  purpose  of  learning  the  profession,  his  license  shall  be 

rrrtto  sucVsr  ^"^'"^^  ^^ '-'  p^°^'^^^  ■■"  °*-  -- '' 

This  law  is  said  by  some  to  deny  the  right  of  striking  and  to  put 
these  organizations   into   the  list   of   nonstriking   ones.     President 
William   F.  Yates,  of  the  National   Marine  Engineers'   Beneficial 
Association,  however,  speaking  concerning  the  right  of  federal  control 
says  m  an  official  letter  that  "no  officer  of  the  inspection  service  has' 

"Z  'f "h  rr^'f '  f  '°  '"^^  '  """  '^'"^^^  t°  «<^«P'  employment, 
and  If  he  (officer)  asks  such  questions  he  should  be  told  emphatically 

that  It  IS  none  of  his  business.'"  Then  he  goes  on  to  say  that  the 
language  of  the  section  just  quoted  "has  been  taken  by  some  members 
of  the  inspection  service,  owners,  attorneys,  and  others  to  mean  that 
a  licensed  officer  may  be  compelled  to  enter  the  employment  of  any- 
one who  needs  his  services,  and  this  meaning  or  interpretation  is 
absurd  in  the  opimon  of  good  lawyers,  and  I'd  like  to  see  th/.  man 

'  Proceedings,  igio,  p.  297. 


TRADE-UNION  DEVELOPMENT 


353 


who  could  press  me  in  his  service  against  my  inclination  in  the 
matter."  The  contention  is  that  a  marine  engineer  or  other  licensed 
officer  has  no  "official  capacity"  on  any  vessel  except  he  be  in  the 
employ  of  the  owners  or  agents,  and  the  plain  intent  of  the  law  is  to 
prevent  a  licensed  officer  who  is  regularly  employed  on  a  vessel  from 
wrongfully  or  willfully  refusing  to  do  his  duty  in  either  refusing  to 
remain  on  a  vessel  when  required  or  quitting  on  eve  of  departure. 
"Any  other  construction  attempted,"  says  President  Yates,  "should 
be  fought  to  the  bitter  end." 

This  association  was  in  fact,  if  not  in  name,  a  trade-union,  because 
its  rules  provided  that  no  subordinate  association  could  either  go  on 
strike  or  change  its  scale  of  wages  without  the  knowledge  and  consent 
of  the  National  President  and  Advisory  Board.^    Likewise  most  of 
the  troubles  or  strikes  of  this  organization  have  been  in  connection 
with  the  making  of  a  scale  of  wages.^'  Although  emphasizing  collective 
bargaining,  the  Marine  Engineers  asserted  in  1910  that  they  did 
not^'affiliate  with  other  labor  organizations  because  "if  engineers  live 
up  to  the  part  of  licensed  officers  they  need  no  such  alliance  and  that 
such  would  be  harmful  to  both.""^    There  were,  therefore,  no  sym- 
pathetic strikes  in  their  organization.    Even  as  to  strikes,  the  rule 
had  been  enacted  that  the  word  "strike"  must  be  eliminated  from 
the  records  of  each  subordinate  association.*     The   feeling,   how- 
ever, continued  to  grow  that  the  interests  of  the  Association  and 
its  members  were  being  discriminated  against  on  account  of  their 
isolated  labor  position  and  that  they  were  failing  to  gain  the  benefits 
and  rights  accruing  to  other  organizations  through  combined  effort, 
and  so  the  matter  of  affiliating  with  the  American  Federation  of  Labor 
became  urgent.^    At  the  convention  of  1916,  after  considerable  dis- 
cussion and  questioning  a  representative  of  the  Federation  as  to  obli- 
gations involved,  it  was  voted  to  take  a  referendum  vote  of  the  entire 
membership  on  the  matter  of  affiliation.^    The  result  was  2933  for 
and  1236  against  affiliation.    On  account,  however,  of  jurisdictional 
differences  with  the  steam  engineers,  the  machinists,  and  other  unions 
as  to  who  should  do  certain  work  or  make  repairs,  the  acceptance 
of  the  charter  was  held  in  abeyance  until  the  convention  of  the 


1  Constitution,  1907,  p.  27. 

2  Proceedings,  191 1,  p.  485- 
'•^Id.  1910,  p.  143. 


4  Constitution,  1907,  P-  27- 
•'■'Proceedings,  191O,  p.  22. 
^Ibid.  pp.  44,  57- 


"T'KW-"'"* 


354      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Association  in  1917.^    It  is  interesting  to  note  that  a  resolution  for  the 
creation  of  a  defense  fund  was  rejected  because  of  "  the  opinion  that 
the  fact  that  a  defense  fund  was  in  existence  would  cause  our  mem- 
bers to  become  careless  and  aggressive. "=^   Opposition  to  the  Marine 
Engmeers'  coming  into  the  Federation  continued,  and  at  the  con- 
vention of  191 7  the  National  Executive  Committee  was  authorized  to 
contmue  negotiations  with  the  view  of  securing  an  acceptable  charter. 
Durmg  191 7  negotiations  continued,  and  finally  a  conference  with 
the  protesting  international  unions  was  arranged  to  be  held  during 
the  Buffalo  convention  of  the  American  Federation  of  Labor    The 
conference  was  held  Monday  evening,  ^November  19,  1917   between 
representatives  of  the  Marine  Engineers  and  of  the  protesting  organ- 
izations mvolved,  namely,  the  International  Association  of  Machin- 
ists, Brotherhood  of  Boilermakers  and  Iron  Ship  Builders    United 
Association  of  Plumbers  and  Steamfitters,  and  International  Brother- 
hood of  Electrical  Workers.   After  considerable  discussion  an  ami- 
cable adjustment  concerning  the  division  of  work  was  reached    and 
the  protestmg  unions  withdrew  their  objections.    The  charter  was 
issued  on  December  14,  1917,  and  so,  as  a  result  of  a  movement 
begun  m  1903,  the  Marine  Engineers  became  affiliated  with   the 
American  Federation  of  Labor.^ 

The  American  Association  of  Masters,  Mates,  and  Pilots  is  like- 
wise composed  of  licensed  officers,  and  its  development  may  be 
brought  out  briefly.    Although  for  many  years  a  trade-union  in  every- 
thing but  name,  it  did  not  become  affiliated  with  the  American  Fed- 
eration of  Labor  until  1916,  and  then  only  after  much  agitation  and 
discussion  and  the  defeat  of  a  similar  movement  in   191 1*     The 
officials  of  the  Association  denied  for  some  years  that  it  was  a  trade- 
umon^  In  spite  of  the  idea  that  a  licensed  officer  was  in  a  special 
class  by  himself,  the  feeling  grew  that  "the  best  interests  of  this  Asso- 
ciation require  that  it  be  affiliated  with  the  American  Federation  of 
Labor  m  order  that  its  objects  and  purposes  be  more  fully  and  com- 
pletely attained."    Such  a  resolution  was  passed  at  the  1916  conven- 
tion and  subsequently  sustained  by  a  referendum  vote  of  the  entire 

^Minutes  of  the  Executive  Committee,  July,  1916,  p.  26 
2Proceedmgs,  1916,  p.  52.  v     ,  f     ". 

Vu'  ^'^'iT  "^"f^^'  '^'^'  PP-  4°^-406;  1918,  pp.  308-337 
^Master,  Mate,  and  Pilot,  March,  1911,  p.  486. 


TRADE-UNION  DEVELOPMENT 


355 


membership.^  On  account  of  this  action  a  dual  organization,  em- 
bracing the  higher  officers  in  ship  service  and  known  as  the  Ship- 
master's Association,  has  been  formed  by  some  seceding  members,— 
an  evident  example  of  persistent  individualism. 

III.    RAILROAD  EMPLOYEES 

This  group  is  made  up  of  the  train-service  organizations  whose 
members  are  employed  on  the  railroads.  These  are  the  Brother- 
hood of  Locomotive  Engineers,  the  Brotherhood  of  Locomotive 
Firemen  and  Enginemen,  the  Brotherhood  of  Railroad  Trainmen, 
and  the  Order  of  Railway  Conductors  of  America.  All  have  had  a 
common  origin  and  a  similar  development,  as  will  be  brought  out. 

The  Brotherhood  of  Locomotive  Engineers  is  the  oldest  organ- 
ization in  this  group.    It  was  organized  as  the  Brotherhood  of  the 
Footboard  in  1863  and  reorganized  the  next  year  under  the  present 
title.    During  the  first  ten  years  the  Brotherhood  developed  fraternal 
and  beneficiary  features  and  had  a  few  local  strikes,  although  these 
were  discouraged  by  the  officials.    In  1874  the  president  was  deposed 
as  being  too  much  of  a  pacifist  and  was  succeeded  by  P.  M.  Arthur, 
who  continued  at  the  head  of  the  organization  until  his  death  in  1903. 
While  conservative  in  his  policy,  Mr.  Arthur  declared:  "We  are 
opposed  to  strikes  and  will  not  resort  to  them  unless  forced  to  do  so 
by  the  arbitrary  actions  of  our  employers.    It  is  our  only  hope  when 
moral  suasion  fails.""   Wage  agreements  and  arbitration  rather  than 
strikes  were  emphasized.    Strikes  were  necessary  at  times,  because 
some  railroad  officials  were  imbued  with  the  ideas  of  absolute  mon- 
archy.   An  engineer,  for  instance,  was  discharged  and  went  to  the 
superintendent  and  asked,  "Will  you  be  kind  enough  to  tell  me 
what  I  am  discharged  for?"  and  received  the  answer:  "You  are  dis- 
charged, are  you  ?    Well,  that  is  conclusive  evidence  that  the  com- 
pany doesn't  want  you."^   A  campaign  of  education  and  the  use  of 
the  strike  when  necessary  brought  about  better  relations.    The  great 
strike  on  the  Buriington  Railroad  in  1888  is  said  to  have  been  caused 
by  "a  narrow  view  of  master  and  servant  all  along  the  line.   They 
were  the  masters  and  the  road  was  their  kingdom  to  manage,  and  no 

1  Proceedings,  1916,  pp.  73-74- 

'Locomotive  Engineers'  Monthly  Journal,  December,  1876,  p.  55. 

^Ibid.  May,  190S,  P-  393- 


3S6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

interference  or  arbitration  could  be  allowed."  ^  The  result  of  this 
most  bitter  and  prolonged  strike  in  its  history  revealed  the  strength 
of  the  Brotherhood  and  made  it  easier  to  get  along  with  the  railroad 
companies  by  peaceful  means. 

The  Brotherhood  of  Locomotive  Firemen  and  the  Brotherhood  of 
Railroad  Trainmen  have  had  much  the  same  development,  as  will  be 
indicated  briefly.  The  Brotherhood  of  Locomotive  Firemen  was 
organized  in  1873  as  a  mutual  benefit  association  and  did  not  become 
a  distinct  labor  organization  until  1885,  when  a  protective  policy  was 
adopted,  much  against  the  wishes  of  its  officers.-  Likewise,  the 
Brotherhood  of  Railroad  Trainmen,  organized  at  Oneonta,  New  York, 
in  1883  as  the  Brotherhood  of  Railroad  Brakemen  and  changing  its 
name  in  1SS9,  has  had  much  the  same  development  as  the  other 
brotherhoods.^ 

The  most  pronounced  and  dramatic  development  in  this  group 
is  that  of  the  Order  of  Railway  Conductors  of  America,  organized 
m  1868  and  continuing  as  a  purely  fraternal  organization  until  1891. 
The  Conductors  stood  on  the  policy  adopted  at  the  convention  at 
Elmira  in  1877:  "Temperance  and  total  opposition  to  unlawful  and 
violent  uprisings  of  employees,  termed  'strikes.'"  At  the  same  time  a 
resolution  was  passed  unanimously  that  any  brother  engaging  in  a 
strike  should  be  expelled,  and  that  a  notice  of  the  same  with  the 
cause  therefor  should  be  sent  to  all  railroad  superintendents  within 
reach  of  the  division  secretary.  Another  resolution  at  the  same  con- 
vention provided  that  "  the  names  of  all  members  expelled  for  drunk- 
enness or  engaging  in  a  strike  shall  be  published  in  the  magazine."* 

The  year  1877  was  marked  by  violent  railroad  strikes,  and  the 
resolutions  quoted  probably  were  caused  by  a  reaction  from  the  same 
Still,  in  1882,  Grand  Chief  Conductor  G.  S.  Wheaton  declared  that 
the  weaker  party  succumbs  in  every  strike  and  that  there  are  no  gains 
through  strikes  and  coercion,  and  in  the  convention  of  the  same  year 
the  platform  adopted  ran :  "  Reserving  the  right  to  prosecute  our  own 
business  according  to  the  dictates  of  our  own  conscience,  and  within 
the  law,  according  to  every  other  man  the  same  right." ^  The  next  year, 

'Locomotive  Engineers'  Monthly  Journal,  October,  i8q6,  p    880 
-Locomotive  Firemen's  Magazine,  June,  1910,  p.  843 
•^History  by  D.  L.  Cease,  p.  5.  '    ^     '  ^     4J. 

^Proceedings,  1885,  p.  739.  =7rf.  1882,  p.  507. 


TRADE-UNION  DEVELOPMENT 


357 


1883,  a  circular  was  issued  stating  that  the  Order  was  uncompro- 
misingly opposed  to  strikes  or  coercive  measures.^  At  the  Louisville, 
Kentucky,  Convention,  in  1885,  a  resolution  was  passed  and  embodied 
in  the  Constitution  providing  that  in  order  to  obtain  recognition  in 
the  matter  of  obtaining  favors  and  adjusting  grievances  the  division 
or  divisions  interested  should  select  a  member  or  members  as  a  com- 
mittee to  wait  upon  the  general  officers  of  the  railroad  company,  and, 
if  refused,  to  ask  the  Grand  Chief  Conductor  of  the  Order  to  call 
on  the  officers  and  endeavor  to  effect  a  settlement.  It  was  made 
obligatory  on  the  Grand  Chief  Conductor  to  comply  with  such  a 
request  in  every  case,  and  the  expenses  attending  same  were  to  be 
borne  either  by  the  division  or  the  individual  making  the  request.' 
This  marked  a  change  of  the  Order  from  a  mutual  fraternal  society 
to  a  labor  organization,  and  it  was  so  designated  by  Grand  Chief 
Conductor  Wheaton  at  the  New  Orleans  Convention  in  1887.  The 
movement  for  making  the  Order  a  factor  in  the  adjustment  of 
grievances  marked  by  this  opening  wedge  continued,  and  the  culmina- 
tion came  in  the  removal  of  the  law  against  strikes  and  the  election 
of  E.  E.  Clark,  who  represented  the  progressive  element,  as  Grand 
Chief  Conductor  at  the  convention  at  Rochester,  New  York,  in  1890.^ 

A  good  deal  of  the  subsequent  growth  of  the  Order  was  due  to 
the  wise  and  energetic  policy  of  Mr.  Clark,  who  served  until  1906, 
when  he  resigned  to  accept  an  appointment  on  the  Interstate  Com- 
merce Commission.*  Just  before  the  removal  of  the  no-strike  law  a 
demand  for  an  increase  of  wages  on  the  New  Albany  Railroad  was 
met  by  its  superintendent  in  refusing  with  the  words,  "You  cannot 
strike";  but  the  conductors  replied,  ''We  can  quit,"  and  the  result 
was  that  they  received  the  increase  demanded.^  A  strike  in  1890 
and  another  one  in  1891  showed  the  necessity  of  some  definite  strike 
rules,  which  later  were  enacted  at  the  1891  convention  modeled  to  a 
large  extent  on  those  of  the  Locomotive  Firemen.^  These  rules  re- 
main substantially  the  same  to  this  day,  and  other  actions  of  the 
convention  placed  the  Conductors  on  the  basis  of  a  labor  organization. 

These  four  train-service  brotherhoods,  beginning  as  fraternal  and 
beneficiary    orders    merely,    have    thus    become    under    prevailing 


1  Proceedings,  1883,  p.  S9S- 

2/d.  1885,  p.  787. 

3/d.  1890,  pp.  136,  276. 


4/d.  1907,  p.  46. 

^Id.  1890,  p.  no. 

6/(i.  1 89 1,  pp.  43-49,  341-347. 


i 


,f  ti  I 


358      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

industrial  conditions  regular  trade-unions— business  unions  pure  and 
simple— which,  on  account  of  their  strategic  position  in  the  railroad 
industry  and  consequent  advantage  in  bargaining  power,  have  found  it 
unnecessary  to  affiliate  with  other  unions,  except  that  at  times  they 
have  taken  in  the  Order  of  Railroad  Telegraphers  in  a  wage  demand. 
On  account  of  their  independent  position  they  are  sometimes  called 
the  aristocrats  of  the  trade-union  world,  and  their  strength  may  be 
seen  in  the  passage  of  the  Adamson  Act  in  19 16  by  Congress,  grant- 
ing the  eight-hour  day  and  extra  pay  for  overtime  in  order  to  avert  a 
concerted  strike  on  their  part  throughout  the  United  States. 

IV.    MISCELLANEOUS 
In  this  fourth  group  is  found  a  number  of  organizations  at  various 
stages  of  development  recapitulating  the  experiences  of  the  organi- 
zations in  the  preceding  groups.    In  this  group  tendencies  are  not 
so  clear,  and  some  of  the  movements  are  not  fully  developed  as  yet. 
One  type  of  organization  is  that  made  up  of  state,  county,  and  city 
employees,  and  thus  including  to  some  extent  men  of  special  training 
and  education.    These  include  such  unions  as  the  Bridge  Tenders' 
Union,  City  Firemen's  Union,  City  Highway  Employees,  Health  Offi- 
cers' Association,  Housing  Inspectors,  Municipal  Employees,  School 
Custodians  and  Janitors,   Sidewalk   Inspectors'   Association,    State 
Hospital  Employees,  and  the  National  Federation  of  State,  County, 
and  City  Employees.    These  are,  for  the  most  part,  locll  unions 
affiliated  directly  and  not  through  an  international  union  with  the 
American  Federation  of  Labor.   A  movement  for  the  unionization  of 
policemen  has  been  proposed  recently  in  Boston.    Police  Commis- 
sioner O'Meara  voiced  his  strong  opposition  to  the  movement  in 
that  while  a  union  of  some  public  employees  might  be  a  matter  of 
doubtful  propriety,  one  of  policemen  would  mean  an  abandonment 
of  an  impartial  attitude  on  account  of  affiliation  with  an  outside 
organization  and  so  not  to  be  allowed.^    However  that  may  be,  the 
recent  strike  of  the  London  police  is  of  interest.    The  New  Statelman 
of  September  7,  1918,  states  the  issue  thus: 

We   regret   that   the  police   were  compelled   to  strike    but   we 
heartily  congratulate  them  upon  their  victory.    Their  grievances  were 
mamfold,  and  if,  after  years  of  "victimization,"  stern  refusal,  and 
^Boston  Evening  Transcript,  June  29,  1918,  p.  2. 


TRADE-UNION  DEVELOPMENT 


359 


procrastination,  they  decided  that  nothing  but  a  strike  could  brmg  the 
authorities  to  reason,  they  had  plenty  of  grounds  for  their  belief.    A 
very  brief,  and  on  the  whole  very  orderly  and  good-tempered,  demon- 
stration was  all  that  was  necessary.    It  was  too  late  to  try  to  hit  at 
the  Union  once  more  by  wholesale  dismissals ;  the  public  and  the 
newspapers  (though  shocked)  were  uniformly  sympathetic  with  the 
strikers  •  Mr.  Lloyd  George  was  staggered  to  find,  quite  suddenly, 
that  a  force  he  believed  to  live  in  paradisal  content  was  thoroughly 
discontented ;  and  the  Government  made  a  swift  climb-down.    Before 
the  strike  the  minimum  wage  was  30  5.,  with  a  war  bonu^  of  12  s.  and 
a  25   dd.  allowance  for  children;  the  total  has  now  been  increased 
by  135.    There  is  also  to  be  a  noncontributory  pension  for  widows. 
Recognition  has  not  been  accorded  in  terms,  but  the  Union  Executives 
were  met  by  Mr.  George  as  the  men's  representatives,  and  ex-P.  C. 
Thiel  provisional  organizer  of  the  Union  and  delegate  to  the  London 
Trades  Council,  is  to  be  restored  to  the  post  from  which  he  had  been 
dismissed  for  taking  part  in  "an  unauthorized  association."    This 
means  that  if  "recognition"  has  not  been  given  in  words,  it  has  been 
given  in  all  save  words. 

Librarians,  school  teachers,  and  college  professors  have  generally 
regarded  themselves  as  professional  men  and  women.    The  Library 
Employees  Union  has,  however,  been  organized  in  New  York  City. 
A  similar  movement  in  Boston  has  been  criticized  on  the  ground  that 
"  it  has  from  time  immemorial  been  the  rule  among  professional  men 
and  women  that  an  organization  of  themselves  to  advance  wages  is 
unprofessional  and  undignified."^    The  most  advanced  movement  in 
this  group  is  found  in  the  American  Federation  of  Teachers,  organ- 
ized April  15,  1916,  and  affiliated  with  the  American  Federation  of 
Labor,  which,  on  November  18,   1918,  included  thirty-three  local 
unions  stretching  from  the  Atlantic  to  the  Pacific,  with  one  in  the 
Canal  Zone.   A  local  union  of  more  than  three  hundred  women  teach- 
ers was  organized  at  St.  Paul  in  June,  1918,  during  the  convention 
of  the  American  Federation  of  Labor.    Another  local  union  has  just 
been  formed  by  the  faculty  of  Howard  University,  Washington,  D.  C, 
the  first  among  the  colleges.   The  ideal  of  the  movement  is  "  democ- 
racy in  education  ;  education  for  democracy."    Evidently  there  seems 
to  be  a  reason  for  this  movement,  for  as  one  teacher  said  to  the  writer, 
"We  have  tried  literary  clubs,  social  organizations,  and  teachers'  asso- 
ciations and  they  have  not  gotten  us  anywhere,  and  now  we  are  going 
^Boston  Evening  Transcript,  May  22,  1918. 


! 


■1 
ff 


i\ 


ii- 


360       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

to  try  a  trade-union."    An  example  of  results  obtained  is  shown  in 
the  Chicago  school  situation,  where  a  school  board  has  been  legislated 
out  of  office  and  a  new  one  substituted  largely  by  the  help  of^'organ- 
ized  labor  and  other  liberal  elements.    A  statutory  guarantee  of  ten- 
ure during  efilciency  has  also  been  obtained.    The  old  board  had 
passed  a  rule  forbidding  membership  of  teachers  in  organizations 
affiliated  with  labor,  or  any  other  organizations  that  might  be  specified 
at  any  time  in  the  future  at  its  caprice.    It  had  also  passed  a  rule 
abolishing  tenure  based  on  meritorious  service  and  had  dropped  sixty- 
eight  teachers.    In  such  a  case  as  this  it  is  necessary  for  teachers  to 
combine  and  affiliate  themselves  with  other  organizations  and  not 
stand  weak  and  alone.    The  discharged  teachers  who  belonged  to  the 
Federation  were  all  reinstated  and  have  continued  their  local  organiza- 
tion (Chicago  Teachers'  Federation)  without  reaffiliation  with  or- 
ganized labor,  from  which  they  withdrew  for  the  time  being  as  a 
matter  of  policy.    The  alliance  of  teachers  with  trade-unionism  is 
a  sign  of  present  economic  conditions  and  should  arouse  considerable 
interest.    The  American  Federation  of  Teachers,  however,  is  not  a 
mere  bread-and-butter  movement,  as  is  shown  by  its  program  of 
educational  and  social  reforms.^ 

In  conclusion  it  may  be  said  that  the  economic  conditions  of  the 
present  day  are  such  that  organizations  beginning  as  fraternal  and 
beneficiary  ones  become  under  economic  pressure  trade-unions.  The 
younger  organizations  seem  but  to  recapitulate  in  their  growth  the 
development  of  the  older  ones.  Among  the  larger  organizations 
studied  the  exception  seems  to  be  the  National  Association  of 
Stationary  Engineers,  but  even  in  this  organization  there  has  been 
some  agitation  for  trade-union  policy  and  affiliation. 

The  question  naturally  arises:  What  has  become  of  the  spirit 
of  individualism  which  has  always  been  such  a  prominent  factor  in 
American  life?  A  partial  answer  is,  of  course,  that  a  large  number 
of  American  workmen  are  not  connected  with  the  trade-union  move- 
ment although  that  number  is  becoming  less.  But  the  fact  remains 
that  If  workmen  are  organized  at  all  the  tendency  is  to  become  identi- 
fied with  the  trade-union  movement.  The  notion  that  because  a  man 
IS  a  government  employee,  or  a  licensed  officer,  or  a  more  or  less 

C^l^:7lm^^^^^^^   ''''''^''''   '^''^  ''■   ^^^'   ^^^-   L^"-   of   President 


TRADE-UNION  DEVELOPMENT 


361 


skilled  workman,  or  considers  himself  a  professional  man,  he  can 
stand  alone  under  present  conditions  of  industrial  and  social  organi- 
zation, has  been  weighed  in  the  balance  and  found  wanting.  The 
sentiment  "I'm  a  licensed  officer  and  not  a  trade-unionist"  may  swell 
a  man's  pride,  but  it  does  not  go  far  in  getting  help  for  the  passage 
through  Congress  of  a  law  to  better  his  working  conditions.  The 
dissenting  votes  in  the  various  organizations  examined  show  that  the 
individualistic  feeling  is  not  dead,  but  the  majority  votes  in  favor  of 
affiliation  with  organized  labor  indicate  a  recognition  of  facts  and 
show  the  trend  of  events.  Whether  he  will  or  no,  the  workman  of 
today  is  being  forced  to  organize  along  trade-union  lines  and  is  fast 
developing  a  strong  class  consciousness. 


George  Milton  Janes 


Pennsylvania  State  College 


ti 


II 


XXVI 

AMALGAMATION  OF  RELATED  TRADES  IN 
AMERICAN  UNIONS^ 

WHILE  the  radical  industrial  unionists,  who  favor  combining 
all  crafts,  skilled  and  unskilled,  in  an  industry,  have  been 
engaged  in  controversy  with  the  conservative  trade  autonomists  who 
oppose  this  policy,  a  gradual  evolution  has  been  taking  place  in 
consequence  of  which  craft  unions  are  disappearing.  Of  133  national 
unions,  most  of  them  affiliated  with  the  American  Federation  of 
Labor,  only  28  may  be  called  craft  unions,  if  by  a  craft  we  mean  work 
requiring  identical  skill  and  training.  Nor  do  these  figures  tell  the 
whole  story,  since  about  one  half  of  the  28  craft  unions  are  cooperat- 
ing through  loose  alliances  with  other  related  trades  in  the  same 
industry.  Yet  the  disappearance  of  the  craft  union  does  not  neces- 
sarily prove  the  ultimate  victory  of  the  industrial  union.  Only 
5  of  the  national  unions  claim  jurisdiction  over  all  trades  in  an 
industry.  The  remaining  100  are  of  an  intermediate  type.  They 
unite  only  part  of  the  trades  in  an  industry.  We  shall  call  them 
amalgamations  of  related  trades. 

The  history  of  American  unionism  reveals,  indeed,  an  occasional 
tendency  towards  disintegration  of  related  trades.  Between  1889 
and  1902  the  printing-pressmen,  the  bookbinders,  the  photo- 
engravers,  and  the  stereotypers  and  electrotypers  seceded,  one  after 
another,  from  the  International  Typographical  Union  and  formed 
separate  organizations.  More  recently  the  window-glass  cutters 
and  flatteners  have  broken  away  from  the  Window-Glass  Workers' 
Union.  But  such  instances  of  disintegration  have  been  comparatively 
rare.  Moreover,  crafts  which  were  once  united  and  later  became 
disunited,  as,  for  example,  in  the  boot  and  shoe  industry,  have  some- 
times been  brought  together  again.  Much  more  frequent  has  been 
the  amalgamation  of  related  trades  by  the  combination  of  existing 
»From  American  Economic  Review,  Vol.  V  (1915),  pp.  554-575. 

362 


RELATED  TRADES  IN  AMERICAN  UNIONS        363 

unions,  by  the  extension  of  the  jurisdiction  of  a  craft  union  to  include 
unorganized  crafts,  or  simply  by  the  retention  of  membership  m 
the  original  organization  as  the  craft  has  split  by  division  of  labor 

into  several  crafts. 

The  amalgamation  of  related  trades  has  been  taking  place  in  the 
United  States  almost  ever  since  national  unions  began  to  appear. 
The  machinists  and  blacksmiths,  who  were  united  in  the  same 
union  as  early  as  1859,  managed  also  to  bring  the  boiler-makers  into 
their  organization  before  it  went  to  pieces  in  1877.  The  Sons  of  Vul- 
can composed  of  iron-boilers  and  puddlers,  united  in  1876  with  the 
National  Union  of  Iron  and  Steel  Roll  Hands  and  the  Associated 
Brotherhood  of  Iron  and  Steel  Heaters,  Rollers,  and  Roughers  of 

the  United  States. 

The  number  of  such  amalgamations  has  increased  greatly  since 
1894    As  division  of  labor  has  become  more  minute,  trade  barriers 
have  become  less  rigid,  and  differences  of  skill  have  been  lessened. 
Hence  the  newly  created  crafts— if  we  can  still  so  call  them— have 
not  only  held  together  but  have  also  affiliated  themselves  with  other 
crafts   in   the   same    industry.    Integration   of   industry   has    been 
another  factor.   Workers  engaged  in  different  parts  of  the  industrial 
process  have  been  brought  together  under  a  common  management 
and  have  combined  in  order  to  cooperate  for  collective  bargaming. 
Between  1894  and  1904  the  various  unions  of  boot  and  shoe  workers 
coalesced  as  did  also  those  of  the  hatters  and  of  the  textile  workers ; 
the  union  of  furniture  workers  combined  with  that  of  the  machine 
woodworkers;  the  Iron  Molders'  Union  absorbed  the  coremakers; 
and   the   union   of   coal-hoisting   engineers   was   merged    into   the 
United  Mine  Workers.    The  period  witnessed  the  rise  of  the  Amal- 
gamated Meat  Cutters  and  Butcher  Workmen  with  its  minutely 
subdivided  groups  of  workers,  skilled  and  unskilled,  in  the  meat- 
packing houses.    During    this   decade,   also,    the   United    Brewery 
Workmen,  the  United  Mine  Workers,  and  the  Western  Federation 
of  Miners  embarked  on  their-  policy  of  industrial   unionism  and 
attempted  to  bring  into  their  organizations  all  kinds  of  workers  m 

the  industry. 

During  the  ten  years  since  1904  the  movement  towards  amalga- 
mation of  related  trades  has  been  accelerated  by  the  rise  of  the 
Industrial  Workers  of  the  World.    Both  of  the  labor  federations 


•^  ■ 


I 


-I: 


m 


364       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

ht^l^'^h''''  "".f  ''''"''''  ''"'  '''''  "="''°"^'  ""'°"  affiliated  with 
>K ""/!."  ""  ^"''^'■■^  '"  ^"  '"'^"^''y-    The  growth  of  these 

F^deat:  of  1,1°"  '"  ""'°"''^''^  stimulated' the  American 
Kederafon  of  Labor  to  pursue  a  more  liberal  attitude  towards 
trade  ama  gamat.on  and  industrial  unionism.  The  attitude  of  the 
dommant  fact.on  in  the  American  Federation  of  Labor  has   indeed 

aTliedT:   h""  ™"r'-    ""^^  '^™  "''^'^  autonomists,"  wh"cht 

.sm     But  nntT'  "  r.'"  '"'-^'"''"^-    ^''^>'  "PP"-  -dustrial  union- 
ism.   But  not  even  the  most  conservative  of  the  older  labor  leaders 

Z^^::l''r'''r  '"'  '""^°'^  "^  ''^  P-'  -uld  dS  s 
J  cr-,T        •        •'"'  ?""  ^'"""°"^  °f  •^^''^^  "-  '°  forbid  all  fusion 

close  V  rlL" .'"      "  k"'""-     "^^^  f^"°^  '"^  amalgamation  of 
dosely  related   trades,   but   are  inclined   to   broaden   very   slowly 

the,r  ,„  erpretation  of  the  words  "closely  related."   They  have  been 

^pecally    reluctant    to    encourage    the    absorption    o^    unskiild 

tnbut  on  of  a  craft  employed  in  several  industries  among  a  corre- 
spondmg  number  of  industrial  unions 
In  times  past  the  American  Federation  of  Labor  has  been  opposed 

auildmg  Trades  Council.    It  opposed  the  latter  organization    not 
because  U  objected  to  such  cooperation  between  related  trades   bu 
because  the  International  Building  Trades  Council  refused  to  affl 
.ate  wuh  a  and  yet  was  settling  jurisdictional  disputes  in  he  buildS 
trades,  mamtaining  sympathetic  strikes,  and  fumning  oth  r  fun  S 

er  lionTf  Lab^  T^ °™^-h'  ''"  T  ''  '^^^''  '^  ^'^  American  f! 
made  aleenl  ^""'r  'V  '''^American  Federation  of  Labor 
made  a  sneeping  assertion  at  the  convention  in  1901  regarding  this 
conflict  of  function.    "There  is  nothing"  he  said    "fnr     v.  ?  .v. 

International  Building  Trades  Cnnn.n  !,    ,    '  "^""'^  "'^ 

i.uuuiu^    iraaes  Council  can  dec  are  which  has  n^^f 

been  more  effectually  exercised  and  more  clearly  acWeVedbv  the 

American  Federation  of  Labor."   Such  a  statement  is  an  exa—ion 

since  the  group  of  related  trades  has  interests  in  common  wCch.' 

general  labor  federation  will  not  promote.  Nevertheless,  The  alliance 

head^rart't  c":^d'r:tre;tJh'"f '^'  ^"^""^  °'  '"^  w-^i  "- 

broke  away  from  the^par  „t  0  gStion  ^:1ZT)  '"  °'''"\  ™^  '^"" 
bearing  the  same  name.  ^^"'^ation  in  1908  to  form  a  rival  federaUon 


RELATED  TRADES  IN  AMERICAN  UNIONS         36S 

of  some  of  the  national  unions  of  the  building  trades  was  very  prob- 
ably ^Takened  by  their  greater  interest  in  the  dependent  federation 
of  ^e  trades  in  their  own  industry.   The  American  Federation  of 

Labor  contented  itself  at  first  merely  with  oPP^-T-.ttTTr  d- 
structive  policy  was  inaugurated  in  1903  when  the  Metal  Trades 
Fd  radon  composed  of  machinists,  blacksmiths,  patternmakers 
^  n  molde.,  and'other  metal  trades,  was  made  a  depart-nt  o  Uie 
American  Federation  of  Labor.  Subsequently,  a  building-trades  de 
payment,  a  mining  department,  and  a  department  0  ra  way  em- 
nloyees  were  created.  Only  the  railway  shop  crafts  are  at  present 
unifed  in  the  railway  employees'  department,  but  the  ultimate  purpose 

is  to  combine  all  railway  employees.  r»^»r,finn  of 

Recently  the  party  in  control  of  the  American   Federation  of 
Labor  has  shown  a  tendency  to  pursue  a  more  liberal  policy  regard- 
ing the  organization  of  the  unskilled.   This  is  illustrated  by  the 
fforts  to  form  unions  of  migratory  and  other  unskilled  workers  and 
by   he  sanction  given  in  rgxa  to  the  plan  of  the  shingle  weave^  to 
include  all  workers,  skilled  and  unskilled,  in  the  lumber  industry^ 
The  majority  in  the  American  Federation  of  Labor  are  still  opposed 
to  industrial  unionism.    For  some  time,  however,  there  has  been  a 
steadily  increasing  minority  desiring  industrial   unionism,   and  at 
r  cent  conventions  of  the  general  labor  federation  they  have  ma  n- 
Ta^ed  a  strong  though  unsuccessful  fight  for  the  adoption  of  resolu- 
tions favoring  that  method  of  organization 

Should  the  amalgamation  of  related  trades  include  all  or  only  a 
part  of  the  crafts  in  an  industry?    Should  the  government  by  which 
such  related  trades  are  united  be  a  centralized  amalgamation  practi- 
cally identical  with  that  of  the  national  craft  unions  which  it  replaces 
or  should  it  be  a  loose  alliance  or  federation  in  which  the  national 
c  aft  unions  continue  to  retain  their  existence?    To  answer    hese 
questions  we  must  consider,  first,  the  reasons  for  uniting  related 
trades ;  secondly,  the  relative  advantages  and  disadvantages  of  cen- 
tralized amalgamations  and  loose  confederations ;  and,  thirdly,  the 
kinds  of  related  trades  which  have  tended  to  unite. 

An  important  reason  for  uniting  a  group  of  related  crafts  has  been 
the  need  of  cooperating  to  maintain  strikes  against  a  common  em- 
ployer. Strikes  are  much  more  effectual  if  all  wage-earners  m  indus- 
Irial  establishments,  including  many  not  affected  by  the  dispute,  may 


IN 


f 


366       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

be  ordered  to  quit  work  simultaneously.    When  the  great  strike  in 
the  meat-packing  houses  of  Chicago  was  declared  in  the  summer  of 
1904,  the  stationary  engineers  and  stationary  firemen,  who  have 
separate  organizations  from  the  other  employees,  remained  at  work 
Had  they  quit,  the  strike  would  not  have  failed,  sav  the  leaders 
of  the  Amalgamated  Meat  Cutters  and  Butcher  Workmen      With 
a  large  supply  of  meat  in  the  refrigerators  to  satisfy  current  de- 
mands, the  packers  could  view  with  equanimity  the  prospect  of  a 
cessation  of  work  for  many  days.     But  if  the  stationary  engineers 
and  the  stationary  firemen  had  struck  and  so  closed  down  the  ice 
plant   in   the   refrigerating   department,   they   would   have  had    to 
make  terms  within  a  few  hours.     The  engineers  and  firemen  did 
apply  to  their  organizations  for  consent  to  strike  in  sympathy  with 
the  butchers,  but  some  days  elapsed  before  permission  could   be 
obtained.    When  they  did  finally  strike,  the  packers,  anticipating 
such  a  movement,  had  already  secured  engineers  and  firemen  to  take 
their  places. 

Again,  strikes  of  employees  in  a  single  department  of  a  factory 
often  fail  because  the  employees  in  other  departments  can  be  kept 
busy  by  having  the  work  of  the  strikers  done  in  some  other  estab- 
lishment.   For   example,   if   the   compositors    in    a   printing   office 
declare  a  strike,  but  the  printing-pressmen  remain  at  work,  the  pub- 
lisher may  have  his  composition  done  by  nonunion  workers  in  some 
other  office,  the  forms  or  stereotyped  plates  being  handled  by  his 
own  pressmen.    Employers  united  in  opposition  to  the  union  fre- 
quently put  themselves  to  considerable  inconvenience  to  help  one 
another  in  an  emergency.    It  was  the  desire  to  put  an  end  to  such 
practices  on  the  part  of  employers  which  led  to  the  amalgamation  of 
three  national  unions  of  iron  and  steel  workers  in  1876     WTien  the 
iron-boilers  and  puddlers  went  on  strike,  the  heaters  and  rollers  were 
kept  at  work  by  supplying  them  with  muck  iron  made  by  nonunionists 
in  other  places.    For  this  reason  the  great  Pittsburgh  strike  of  boilers 
and  puddlers  failed  in  1875  ;  and,  because  of  its  failure,  this  group 
of  workers,  highly  skilled,  strongly  unionized,  and  withal  much  in 
clmed  to  hold  aloof  "from  entangling  alliances,"  was  converted  to 
the  plan  of  amalgamating  all  trades  in   the  iron  and  steel  mills 
into  one  union.' 

^National  Labor  Tribune,  Pittsburgh,  January  2,  9,  April  10,  ,875. 


RELATED  TRADES  IN  AMERICAN  UNIONS        367 

Without  cooperation  between  the  related  crafts  in  an  industry, 
strikes  of  a  single  trade  fail  because,  in  order  to  keep  the  plant  m 
operation  and  thus  remain  employed,  the  members  of  other  trades 
do  the  work  of  the  strikers  or  instruct  nonunionists  how  to  do  it. 
Thus,  in  times  past,  locomotive  firemen  have  run  engines  during 
strikes  of  locomotive  engineers ;  and  locomotive  engineers,  on  their 
part,  have  taught  strike  breakers  how  to  perform  the  duties  of 
locomotive  firemen.   Undoubtedly,  unions  would  be  able  to  bargain 
much  more  effectively  for  better  working  conditions  if  the  agree- 
ments or  contracts  of  all  trades  in  an  establishment  expired  at  the 
same  time,  if  the  demands  of  the  several  trades  were  presented  jointly 
to  an  employer,  and  if  a  refusal  to  comply  with  these  demands 
caused  every  employee  in  the  establishment  to  quit  work. 

On  the  other  hand,  strikes  of  a  single  trade  which  cannot  be  readily 
replaced  are  unfair  to  the  other  related  trades  in  the  ind-f  try  since 
such  a  single  trade,  even  though  composed  of  only  a  handful  ot 
journeymen,  can  often  shut  down  a  large  plant  and  throw  out  of  em- 
ployment hundreds  of  workmen  who  have  no  voice  in  the  matter.  One 
reason  why  the  International  Typographical  Union  wishes  to  retam 
control  over  the  machinists  in  the  printing  office  is  because  a  strike 
on  their  part  may  abruptly  halt  all  activities  and  throw  the  other 
workers  out  of  employment. 

Strikes  of  a  single  trade  are  unfair  to  the  group  which  wages  them 
when  other  workers  in  the  factory  who  have  not  helped  to  wm  the 
strike  must  share  the  fruits  of  victory.  If  a  group  whose  presence 
is  necessary  for  the  running  of  a  factory  labors  only  eight  hours  a 
day  the  other  employees  must  also  suspend  work  at  the  end  of  the 
eighth  hour.  In  consequence,  when  the  trades  in  an  industry  are 
organized  into  separate  unions,  one  of  them  may  bear  the  brunt  of 
a  long  and  severe  struggle  to  secure  improvements  which  will  also 

benefit  the  others.  ,•  ,    i,  „„«. 

A  group  of  trades  which  jointly  produce  a  single  article  benefit 
greatly  by  uniting  to  boycott  "unfair"  firms  and  to  extend,  by  means 
of  the  unL  label,  the  sale  of  goods  made  in  "  fair"  shops.  Attempts 
of  each  trade  to  maintain  independent  boycotts  cause  much  con- 
fusion. Thus,  the  printing-pressmen  may  be  urging  the  public  not 
to  buy  the  newspaper  of  a  publisher,  while  the  printers,  to  whom 
the  same  publisher  has  accorded  excellent  conditions,  may  be  urging 


If 


368      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  public  to  buy  it.    One  reason  why  the  brewery  workmen  became 
enthusiastic  advocates  of  the  so-called  "industrial  union"  was  be- 
cause of  the  conflict  in  maintaining  boycotts  which  occurred  when 
the  various  trades  were  organized  into  separate  associations.    Simi- 
larly, when  each  trade  in  an  industry  has  a  separate  label,  conflict  is 
inevitable.     Thus,  if  one  of  the  trades  in  a  particular  factory  is 
organized  and  the  others  are  not,  the  union  of  the  unorganized  trade 
will  object  to  the  efforts  of  the  organized  union  to  extend  the  sale  of 
the  goods  made  in  that  factory  by  means  of  the  union  label     The 
various  organizations  of  boot  and  shoe  workers  amalgamated  in  i8g? 
because  of  the  great  need  of  cooperating  to  maintain  a  single  label ' 
After  four  trades  in  the  printing  industry  had  split  off  from  the  Inter- 
national Typographical  Union,  local  alliances  of  the  printing  trades 
m  each  community  became  necessary,  primarily  to  promote  harmony 
in  the  use  of  the  union  label. 

Another  reason  for  amalgamation  and  federation  of  related  trades 
IS  the  movement  of  workers  from  one  craft  or  division  of  a  craft  to 
another.    Instances  of  crafts  whose  members  are  recruited  from  other 
trades  are  numerous.    The  ranks  of  the  locomotive  engineers  are 
replenished  from  the  locomotive  firemen.   A  railroad  brakeman  may 
become  later  a  railroad  conductor.    The  pressman's  assistant  rises 
to  the  position  of  printing-pressman.  The  cigar-maker  of  ability  learns 
enough  concerning  the  varieties  of  tobacco  and  the  making  of  the 
cigar  to  do  the  work  of  the  cigar-packer.    Many  carpenters  and 
cabinetmakers  enter  the  craft  of  patternmaking.    In  the  large  meat- 
packing houses,  in  the  coal  mines,  in  boot  and  shoe  factories  =  and 
in  other  industries  division  of  labor  is  lessening  the  amount  of  skill 
required,  and  journeymen  pass  readily  from  one  kind  of  work  to 
another.    Under  such  conditions  the  various  groups  of  workers  must 
combine  to  control  the  supply  of  the  labor  in  the  industry  and  to 
prevent  disastrous  competition  for  employment  between  members  of 
different  unions.    The  combination  of  related  trades  solves  also  the 
difficulty  created  by  the  refusal  of  journeymen  who  change  their 

^The  Laster,  Lynn,  June  15,  iSgr,  p  2 

=^The  Boot  and  Shoe  Workers'  Union  adopted  the  following  in  1004-  "Mem 
bers  working  at  one  branch  of  the  trade  are  entitled   to  change   to  another" 
branch,  provided  the  local  union  having  jurisdiction  over  tharb  anch  canno 

f.:^.rz:T%r  °'  '^  "^^"'^^^"  ^^^^^  ^-^-'  ^-<-  BoTn 


RELATED  TRADES  IN  AMERICAN  UNIONS        369 

trade  to  sever  their  connection  with  the  union  of  their  former  craft 
in  order  not  to  lose  the  right  to  its  sick,  death,  and  other  benefits. 
Thus,  many  locomotive  firemen  after  becoming  locomotive  engineers 
retain  their  membership  in  the  union  of  the  locomotive  firemen.  The 
Brotherhood  of  Locomotive  Engineers  pays  benefits  of  adequate 
amount,  but  the  average  age  of  its  members  is  higher  than  the  average 
for  the  union  of  locomotive  firemen,  most  of  whose  members  are 
young  men.  Hence  the  death  and  disability  rate  of  the  Brotherhood 
of  Locomotive  Engineers  is  larger  and  the  cost  of  maintaining  its 
benefits  is  greater.  Because  of  this  additional  cost,  young  locomotive 
firemen  who  have  received  their  promotion  are  reluctant  to  join  it. 
When  railway  conductors  become  too  old  to  perform  their  responsible 
duties  efficiently  they  are  often  employed  by  the  railroad  company 
as  switchmen.  These  men  are  frequently  too  old  to  become  bene- 
ficiary members  of  the  Switchmen's  Union  and  they  insist  on  retain- 
ing their  membership  in  the  Order  of  Railway  Conductors.  Of  course 
when  part  of  the  members  of  a  trade  belong  to  one  organization  and 
part  to  another,  their,  ability  to  bargain  effectively  with  employers 

is  greatly  lessened.  V^ 

Another  advantage  of  amalgamation  and   federation  of  related 
trades  is  that  it  reduces  the  number  of  jurisdictional  disputes  con- 
cerning the  right  to  do  certain  work.    To  be  sure,  trade  amalgamation 
has  caused  many  jurisdictional  disputes  as  to  membership,  since 
many  of  the  old  craft  unions  have  waged  a  bitter  conflict  against 
the  new  industrial  organizations  which  have  attempted  to  absorb 
them.    But  such  disputes  over  membership  must  be  distinguished 
clearly  from  disputes  over  work  which  arise  because  of  the  difficulty 
of  making  clear-cut  divisions  of  labor  between  the  various  trades 
which  cooperate  in  production.    Thus,  not  only  do  the  masons  lay 
granite  and  other  kinds  of  stone  but  sometimes  they  also  cut  them. 
The  granite-cutters  not  only  cut  granite  but  sometimes  they  also  lay 
it.    In  a  small  town  the  same  man  often  combines  the  trades  of  brick- 
layer, mason,  and  plasterer,  or  those  of  plumber,  steam  fitter,  and  gas 
fitter.    Even  in  large  cities  the  bricklayer  or  the  plumber  may  do 
the  work  of  related  trades  when  he  cannot  find  employment  in  his 
own.    The  brewer  and  the  brewery  driver  must  handle  cooper's  tools 
in  an  emergency,  and  the  cooper  in  the  small  establishment  does  the 
work  of  the  brewer  when  there  is  not  sufficient  cooperage  to  keep 


370      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

him  busy.  In  the  small  retail  store,  clerks  drive  wagons  and  go  out 
for  orders  when  occasion  demands.  On  the  other  hand,  many  a 
driver  fills  at  the  store  the  orders  which  he  has  taken  during- the 
morning  and  then  delivers  the  goods  to  customers.  Such  men  fre- 
quently receive  a  higher  wage  than  either  the  driver  or  the  ordinary 
clerk.  The  introduction  of  machinery,  the  use  of  new  materials,  and 
new  divisions  of  labor  are  upsetting  carefully  established  trade 
boundaries  and  are  giving  opportunity  for  a  plentiful  supply  of 
jurisdictional  disputes.  The  increasing  use  of  cement  has  created  a 
new  group  of  journeymen,  the  cement  workers,  who  are  waging  a 
war  of  words  with  the  bricklayers  about  the  right  to  lay  artificial 
stone  made  of  cement.  Another  comparatively  new  group,  the  ceramic, 
mosaic,  and  encaustic  tile-layers,  are  engaged  in  a  controversy  with 
the  bricklayers  as  to  which  of  them  shall  lay  tile.  The  bricklayers, 
the  tile-layers,  and  the  cement  workers  all  claim  the  right  to  lay 
tile  made  of  cement.    Instances  might  be  multiplied. 

When  two  related  trades  are  organized  into  separate  unions  each 
demands  a  careful  demarcation  of  its  work  and  a  strict  observance 
of  the  boundaries  thus  set.  Such  a  rigid  division  causes  great  in- 
convenience both  to  employer  and  employee  and  in  many  instances 
is  impracticable.  If  after  long  negotiation  a  satisfactory  dividing 
line  is  fixed,  the  adoption  of  new  methods  of  production  is  apt  soon 
to  upset  the  arrangement.  The  result  is  an  endless  controversy  with 
all  the  disastrous  consequences  which  follow  in  the  trail  of  such 
internal  conflicts. 

On  the  other  hand,  if  both  trades  are  united  in  the  same  union, 
one  of  them  may  often  do  the  work  of  the  other  without  causing  a 
serious  dispute.  If  a  dispute  does  arise,  it  can  be  effectively  settled 
when  referred  to  a  common  organization  whose  decision  is  final  for 
both  parties.  In  England,  where  the  stonemasons  and  the  granite- 
cutters  are  federated  in  the  same  union,  there  exists  no  controversy 
between  them  as  in  the  United  States,  where  they  are  divided  into 
separate  organizations.  To  be  sure,  disputes  do  exist  between  Amer- 
ican bricklayers  and  masons  who  are  united  in  the  Bricklayers'  and 
Masons'  International  Union,  but  in  places  where  such  disputes  have 
arisen  harmony  has  usually  been  restored  by  the  committee  on  gen- 
eral good,  which  federates  all  local  societies  of  the  two  trades  through- 
out the  community.    If  this  committee  cannot  settle  the  controversy 


RELATED  TRADES  IN  AMERICAN  UNIONS        37i 

it  is  referred  to  the  international  union,  "which  administers  justice," 
says  an  official  of  the  society,  "and  prevents  another  Cain  and  Abel 
episode."  Jurisdictional  disputes  have  been  serious  blots  in  the  his- 
tory of  many  American  trade-unions,  and  an  important  argument  in 
favor  of  trade  amalgamations  is  the  possibility  that  they  will  prevent 
one  large  class  of  such  disputes. 

An  objection  to  trade  amalgamations  is  that  while  related  crafts 
have  many  interests  in  common,  they  have  other  interests  which  may 
diverge  widely  or  may  directly  conflict.    The  difficulty  of  harmomz- 
ing  these  diverging  or  conflicting  interests  is  increased  when  one  trade 
outnumbers  all  the  others  added  together,  since  the  group  havmg  the 
majority  is  apt  to  use  the  amalgamation  to  further  its  own  concerns 
at  the  expense  of  the  others.    Thus,  in  the  United  Association  of 
Journeymen  Plumbers,  Gas  Fitters,  Steam  Fitters,  and  Steam  Fitters' 
Helpers,  the  gas  fitters  and  steam  fitters,  who  are  outnumbered  by 
the  plumbers,  complain  that  often  they  are  not  given  opportunity 
at  local  and  national  meetings  to  discuss  matters  affecting  their  own 
trades  and  that  when  given  an  opportunity  they  are  outvoted  by  the 
plumbers.    They  declare  that  most  of  the  funds  are  expended  in 
behalf  of  the  plumbers,  and  that  most  of  the  legislation  adopted  is 
favorable  to  that  trade.    The  stonemasons  make  a  similar  complaint 
against  the  bricklayers.    The  printing-pressmen  and  members  of  other 
trades  in  the  printing  industry  affirm  that  they  seceded  from  the 
International  Typographical  Union  because  the  compositors,  who 
preponderated  greatly  in  numbers,  gave  too  little  attention  to  the 

interests  of  the  other  crafts. 

This  weakness  of  the  trade  amalgamation  has  arisen  largely  from 
the  failure  to  provide  in  its  form  of  government  for  the  fact  that 
it  is  a  federation  of  distinct  groups.  The  transition  from  craft  unions 
to  trade  amalgamations  has  frequently  been  so  gradual  that  work- 
ingmen  have  not  been  acutely  conscious  of  the  need  for  changing 
the  structure  of  their  organizations.  Usually  the  constitution  of  the 
old  craft  union  has  been  taken  over  bodily,  often  without  amendment, 
by  the  new  amalgamation.  In  most  organizations  the  national  offi- 
cers have,  sooner  or  later,  been  given  authority  to  organize  each 
trade  or  division  of  a  trade  in  a  community  into  a  separate  local 
union  whenever  conditions  warrant;  but  desiring  to  secure  the 
economies  of  the  large  local  union,  they  have  been  slow  to  exercise 


' 


372       TRADE  UNIOxNISM  Ax\D  LABOR  PROBLExMS 

this  discretionary  power.  Frequently,  also,  each  trade  is  given  care- 
fully weighted  representation  on  executive  boards,  conference  boards, 
and  other  governmental  bodies.  Undoubtedly  harmony  between  the 
related  trades  may  be  greatly  promoted  by  such  provisions,  but, 
when  identity  of  interest  is  slight  and  divergence  or  conflict  of 
interest  is  great,  some  loose  form  of  federation  or  alliance  may 
be  desirable. 

Temporary  alliances  and  loose  federations  of  unions  of  related 
trades  are  by  no  means  uncommon.  Indeed,  there  are  to  be  found 
all  degrees  of  centralization,  from  temporary  cooperation  for  some 
specific  purpose  to  complete  amalgamation.  Temporary  cooperation 
usually  takes  the  form  of  a  sympathetic  strike.  Very  probably  there 
is  no  agreement  to  help  one  another.  Simply,  the  union  of  one  trade, 
on  becoming  involved  in  a  dispute  with  employers,  calls  for  aid 
from  other  workers  in  the  industry,  and  the  latter  respond  by  agree- 
ing to  engage  in  the  conflict.  A  more  advanced  stage  in  cooperation 
is  reached  when  there  is  a  definite  permanent  agreement  to  help  one 
another.  An  example  of  such  an  agreement  is  that  between  the  wall- 
paper machine  printers  and  color-mixers  and  the  print-cutters  who 
make  wall-paper  prints.  By  the  terms  of  this  agreement  the  printers 
and  color-mixers  promise  not  to  use  prints  made  by  nonunion  print- 
cutters,  and  the  print-cutters  promise  not  to  work  for  jobbers  supply- 
ing wall-paper  manufacturers  whom  the  printers  and  color-mixers 
have  declared  to  be  unfair. 

Such  promises  of  two  organizations  to  aid  one  another  are  un- 
satisfactory, however,  if  governmental  machinery  is  not  established 
for  the  purpose  of  making  joint  decisions  and  taking  joint  action 
concerning  matters  affected  by  the  terms  of  the  agreement ;  and  this 
is  particularly  the  case  if  the  agreement  provides  for  cooperation 
by  means  of  sympathetic  strikes.  In  the  first  place,  unless  there  is 
a  joint  tribunal  to  decide  as  to  the  expediency  of  engaging  in  the 
conflict  by  one  of  the  affiliated  crafts,  sympathetic  strikes  are  usually 
ineffective.  When  the  union  of  one  trade  notifies  the  other  only  after 
the  struggle  has  begun,  there  is  often  a  long  delay  while  the  request 
to  strike  in  sympathy  is  being  considered  by  the  national  officers  or 
perhaps  by  each  local  society  of  the  related  craft.  Frequently,  indeed, 
a  strike  of  one  union  is  practically  lost  or  won  before  the  members 
of  another  union  decide  to  quit  work. 


RELATED  TRADES  IN  AMERICAN  UNIONS        373 

A  second  result  of  the  lack  of  cooperation  during  the  preliminary 
stages  of  a  dispute  is  that  it  deprives  one  union  of  the  opportunity 
to  prevent  inexpedient  or  unwise  strikes  desired  by  another.  When 
the  strike  has  already  begun,  and  when  the  refusal  to  help  means  its 
failure,  a  strong  sense  of  obligation  may  force  the  members  of  a 
related  trade  to  engage  in  the  struggle  against  their  will. 

A  third  objection  is  that  unless  the  related  trades  bargain  jointly 
with  employers  and  make  joint  agreements,  the  policy  of  waging 
sympathetic  strikes  increases  the  number  involved  in  each  conflict 
without  reducing  the  number  of  such  conflicts.    For  example,  the 
carpenters  engaged  in  the  construction  of  a  building  declare  a  strike 
for  higher  wages,  and  the  members  of  every  other  trade  on  the 
building  quit  work  in  sympathy.   When  this  trouble  has  been  ad- 
justed, the  plumbers  discover  that  the  employer  has  violated  his 
agreement  with  them,  and  all  trades  again  go  on  strike.    Next,  the 
elevator  constructors  and  the  hoisting  engineers  quarrel  as  to  which 
of  them  shall  run  the  completed  elevator.    The  other  trades  take 
sides,  and  all  building  operations  are  suspended  until  the  dispute 
can  be  settled.    Then  the  business  agent  of  the  plasterers'  union  finds 
that  his  trade  has  a  grievance  and  orders  everyone  to  leave  the 
building.    This  is  not  a  very  exaggerated  picture  of  conditions  in 
the  building  industry  as  they  existed  in  Chicago  just  before  1900 
or  in  New  York  during  the  spring  and  summer  of  1902.    Building 
operations  were  seriously  demoralized.    The  time  for  the  ultimate 
completion  of  a  building  was  a  matter  of  gamble,  with  all  odds  in 
favor  of  delay.     Building  contractors,  landlords,  and  the  general 
public  joined  in  a  chorus  of  protest  against  the  arbitrary  methods 

of  the  unions. 

A  fourth  result  is  to  place  the  unions  in  the  position  of  breaking 
their  contracts.  Perhaps  an  employer  has  granted  favorable  terms 
to  a  union,  which  agrees  on  its  part  to  maintain  industrial  peace  for 
one  or  more  years.  Then  this  union  becomes  involved  in  a  sympa- 
thetic strike  to  help  another  trade  and  violates  its  agreement.  To 
aggravate  the  offense  in  the  eyes  of  the  public  and  the  employer,  the 
members  of  the  union  meddle  in  a  dispute  which  is  apparently  none 

of  their  concern. 

Cooperation  between  unions  of  related  trades  reaches  a  much 
higher  stage  of  efficiency  when  governmental  machinery  is  provided 


374       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

to  carry  out  the  terms  of  the  agreement.    Sometimes  the  existing 
officials  of  the  contracting  unions  are  utilized  for  this  purpose,  as, 
for  example,  in  the  "tripartite  agreement"   for  the  regulation  of 
sympathetic  strikes  by  the  unions  of  printers,  pressmen,  and  book- 
binders in  1896.    By  the  terms  of  this  agreement  the  presidents  of 
the  three  international  unions  visited  in  person  the  place  where  a 
joint  strike  was  demanded  or  sent  a  representative  to  effect  a  settle- 
ment if  possible.    When  the  dispute  could  not  be  amicably  settled, 
each  president  referred  the  matter  to  the  executive  board  of  his  own 
association.    The  three  executive  boards  were  equal  in  size,  and  a 
majority  of  the  three  taken  together  could  declare  a  joint  strike. 
Sometimes  special  governmental  machinery  is  created  to  carry  out 
the  terms  of  the  agreement  between  two  or  more  unions.    Thus  the 
wall-paper  machine  printers  and  color-mixers  and  the  print-cutters 
have  created  a  joint  national  committee  to  control  joint  strikes  and 
joint  agreements  in  every  establishment  where  the  wall-paper  manu- 
facturer makes  his  own  prints ;  in  other  words,  where  the  two  trades 
have  a  common  employer. 

Even  greater  unity  between  the  related  trades  is  attained  when  a 
permanent  federal  government  is  created  not  to  perform  some  par- 
ticular function  specifically  provided  for  in  the  written  agreement 
but  to  perform  any  function  which  the  unions  represented  in  the 
federation  may  jointly  decide,  from  time  to  time,  to  be  desirable 
Federations  of  related  trades  are  either  local,  national,  or  interna- 
tional, the  so-called  international  unions  having  branches  in  Canada. 
Local  federations  were  formed  before  national  or  international  ones. 
Thus,  while  the  International  Building  Trades  Council  was  created 
only  in  1897,  local  federations  of  building  trades  existed  as  early  as 
1882  or  1883  in  New  York,  Chicago,  Baltimore,  Cincinnati,  and  other 
large  cities.^    Movement  of  workers  from  one  city  to  another,  com- 
petition between  employers  in  different  places,  and  other  causes  which 
brought  about  the  combination  of  local  into  national  craft  unions 
have  likewise  operated  to  superimpose  national  upon  local  federations 
of  related  trades. 

National  federations  of  related  trades  have  been  either  combinations 
of  national  craft  unions  or  combinations  of  both  local  allied-trades 
councils  and  national  craft  unions.    In  the  second  instance  either  of 
^The  Carpenter,  New  York,  May,  1882,  June  and  August,  1883. 


RELATED  TRADES  IN  AMERICAN  UNIONS        375 

the  two  kinds  of  constituent  bodies  may  predominate,  according  to  the 
method  of  representation  at  the  convention  of  the  national  federation. 
Thus,  at  conventions  of  the  International  Building  Trades  Council 
the  local  councils  of  allied  trades  outvoted  the  national  trade-unions 
until  1905,  because  each  one  of  the  two  kinds  of  organizations  was 
allowed  the  same  vote.   On  the  other  hand,  at  conventions  of  the 
National  Metal  Trades  Federation  the  national  craft  unions,  whose 
voting  power  varied  according  to  membership,  preponderated  over, 
the  local  councils  of  related  trades,  each  of  which  had  only  one  vote. 
The  national  trade-unions  claim  that  when  outvoted  in  federations 
of  related  trades  their  power  over  subordinate  societies  is  greatly 
weakened.    Prominent  officials  of  the  carpenters,  bricklayers,  granite- 
cutters,  plumbers,  and  other  building  trades  opposed  the  Interna- 
tional Building  Trades  Council   for  this  reason.    Not  all  of  the 
national  trade-unions  in  the  building  industry  were  affiliated  at  the 
time  with  the  International  Building  Trades  Council,  but  the  local 
allied-trades  councils  would  still  have  predominated  even  if  all  of 
them  had  been  represented.    The  national  craft  unions  in  the  building 
industry  have  always  been  decentralized,  and  the  ability  of  their  cen- 
tral governments  to  control  subordinate  societies  was  still  further 
lessened  when  these  subordinate  branches  relied  no  longer  on  the 
central  government  for  financial  and  moral  support  in  time  of  strikes, 
but  secured  whatever  aid  fhey  needed  from  local  and  national  building- 
trades  councils.    To  check  this  tendency  towards  decentralization, 
those  opposed  to  the  International   Building   Trades   Council   or- 
ganized in  1904  the  Structural  Building  Trades  Alliance,  composed 
only  of  national  trade-unions.   Local  allied-trades  councils  were  not 
permitted  representation  at  its  conventions.    In   1905,  too  late  to 
prevent  the  successful  launching  of  the  rival  federation,  the  Inter- 
national Building  Trades  Council  modified  its  policy  by  granting  to 
the  national  craft  unions  a  voting  power  proportionate  to  member- 
ship, while  continuing  to  allow  each  local  allied-trades  council  only 
one  vote.   At  present  the  federation  of  related  trades  dominated  by 
local  allied-trades  councils  is  discredited.    Such  local  councils  may 
be  given  representation  at  the  federal  convention,  but  the  national 
craft  unions  retain  the  controlling  vote. 

The  amalgamation  is  the  most  centralized  form  of  combination 
between  related  crafts;  but,  like  the  national  trade-union,  it  is  a 


376       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

federation  of  local  craft  organizations,  and,  as  already  pointed  out, 
its  machinery  of  government  is  in  most  respects  the  same  as  that 
of  the  national  trade-union. 

The  degree  of  centralization  desirable  for  combinations  of  related 
trades  depends  on  the  number  of  interests  which  they  have  in  com- 
mon and  the  number  which  conflict.  The  administration  of  their 
common  interests  grows  more  efficient  as  they  become  more  central- 
ized ;  but  the  opportunity  for  friction  regarding  matters  of  conflicting 
interest  increases  also.  Thus  the  government  of  the  amalgamation 
is  more  efficient  than  the  federation  of  local  allied-trades  councils  or 
of  national  craft  unions.  It  has  direct  control  over  the  local  craft 
unions  and  thus  can  compel  more  prompt  and  faithful  compliance 
with  its  commands  than  can  the  federation,  which  must  issue  orders 
through  intermediate  organizations.  On  the  other  hand,  friction  is 
more  likely  to  arise,  because  matters  concerning  one  craft  alone  are 
not  left  to  the  organization  of  that  particular  craft  but  are  considered 
by  a  joint  convention  or  joint  executive  board  on  which  all  the  related 
crafts  are  represented. 

Before  determining  the  kinds  of  related  trades  which  should  be 
federated  or  amalgamated,  let  us  first  consider  the  kinds  which  are 
at  present  actually  united.  Amalgamations  and  federations  of  re- 
lated trades  may  be  divided  broadly  into  ( i.)  those  combining  trades 
working  for  the  same  employers  and  (2 )  those  combining  trades  work- 
ing usually  for  different  employers.  Illustrations  of  the  first  are  the 
union  of  employees  in  carriage  and  wagon  factories,  the  union  of  em- 
ployees in  cigar  factories,  and  the  many  other  trade  amalgamations 
whose  members  work  together  in  the  same  industrial  establishments. 
An  example  of  the  second  would  be  an  organization  uniting  the 
makers  of  handsaws  with  the  carpenters  who  use  them.  These  two 
trades  never  have  the  same  employers,  yet  the  possibility  of  combining 
them  has  been  considered. 

I.  Combinations  of  trades  working  for  the  same  employers  may  be 
subdivided  as  follows; 

a.  Industrial  unions  claiming  jurisdiction  over  every  group  of 
workers  in  an  industry,  including  the  unskilled  and  certain  well- 
defined  auxiliary  trades,  such  as  the  stationary  engineers,  the  sta- 
tionary firemen,  and  the  teamsters,  who  are  found  in  many  other 
industries.   The  number  of  industrial  unions  is  small.   A  few  have 


RELATED  TRADES  IN  AMERICAN  UNIONS        377 

recently  been  formed  as  departments  of  the  Industrial  Workers  of 
the  World.    The  most  important  of  the  older  ones  are  the  United  ^ 
Brewery  Workmen,  the  Western  Federation  of  Miners,  the  United 
Mine  Workers,  and  the  Quarry  Workers'  International  Union. 

b.  Unions  which  include  only  part  of  the  related  trades  in  an 
industry.    To   this  group  belong   most   of   the   American  unions. 
Auxiliary  crafts  found  in  other  industries  are  admitted  by  a  few  of 
these  organizations.    Thus,  the  International  Typographical  Union, 
which  embraces  compositors,  proofreaders,  and  mailers,  is  engaged 
in   controversy   with   the   International   Association   of   Machinists 
concerning  jurisdiction  over  the  linotype  machinists.    The  theatrical 
stage  employees  dispute  the  claim  of  the  union  of  carpenters  and 
joiners  to  control  the  stage  carpenters  and  the  claim  of  the  Brother- 
hood of  Electrical  Workers  to  control  the  stage  electricians.    As  a 
rule,  however,  auxiliary  crafts  are  excluded,  and  so  are,  usually,  the 
unskilled  workers.    Some  of  the  unions  in  this  group  unite  only  a 
very  small  proportion  of  the  crafts  in  an  industry.    In  such  instances 
the  trades  combined  are  usually  more  closely  related  than  the  others. 
Thus,  while  the  various  crafts  in  the  railway  industry  have  always 
been  disunited,  certain  ones  which  are  closely  associated  in  the 
operation  of  trains  are  organized  in  the  Brotherhood  of  Railway 
Trainmen.    Similarly,  while  most  of  the  trades  in  the  printing  indus- 
try are  organized  separately,  the  several  groups  of  workers  engaged 
in  bookbinding  are  united  in  a  single  union,  and  so  are,  also,  the 
stereotypers  and  electrotypers.    On  the  other  hand,  some  organiza- 
tions in  this  group  have  acquired  jurisdiction  over  nearly  all  the 
trades  in  an  industry.    Thus  the  International  Seamen's  Union  con- 
trols all  seamen  except  the  highly  skilled  marine  engineers,  mates,  and 
pilots,  who  have  refused  to  affiliate  with  their  less  skilled  fellow  crafts- 
men. '  Some  organizations,  such  as  the  Molders'  Union,  claim  juris-  ^ 
diction  over  all  except  the  auxiliary  trades  and  the  unskilled  workers. 
Others  include  the  unskilled  but  not  the  auxiliary  trades.    Thus  the 
Cigar  Makers'  International  Union  admits  workers  of  all  degrees  of 
skill,  from  the  person  who  selects  the  leaves  of  the  tobacco  to  the 
one  who  packs  the  finished  cigars  in  boxes.    The  boast  of  the  offi- 
cials of  the  Amalgamated  IMeat   Cutters  and   Butcher  Workmen 
of  North  America  is  that  their  organization  makes  no  distinction 
as  to  skill.     The  expert  who  strips  the  hide  from  the  carcass  of 


if; 


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378       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  steer  and  the  common  laborer  who  pushes  a  truck  are  both 
^  welcome  as  members.    But,  in  order  to  escape  jurisdictional  disputes 
with  other  organizations,   both   of   these  unions   refuse   to   admit 
auxiliary  trades. 

2.  The  second  broad  division  of  trade  amalgamations,  namely 

combinations  of  crafts  working  for  different  employers,  contains  only 

a  few  organizations.    These  unite  chiefly  trades  producing  certain 

materials  and  tools  with  trades  using  them.    A  good  example  is  the 

Umted  Brotherhood  of  Carpenters  and  Joiners,  which  includes  not 

only  the  carpenters  and  joiners  employed  on  buildings  in  process  of 

construction  but  also  the  machine  woodworkers  employed  in  mills 

where  sash,  doors,  window  frames,  and  other  woodwork  handled  by 

the  carpenters  are  manufactured.     Another  example  was  the  now 

defunct  American  Railway  Union,  which  included  not  only  those 

engaged  in  railway  transportation  but  also  the  car-builders    The 

great  Chicago  strike  of  1894,  which  caused  the  destruction  of  this 

union,  was  waged  to  secure  better  conditions  of  employment  for  those 

engaged  in  building  Pullman  parlor  cars. 

Trades  producing  materials  and  tools  have  few  interests  in  com- 
mon with  those  using  them.    The  two  groups  may,  indeed,  aid  one 
another  by  means  of  sympathetic  strikes.    Thus  the  carpenters  may 
aid  the  machine  woodworkers  by  refusing  to  use  sash,  window  frames 
or  doors  manufactured  by  nonunionists.     The  wall-paper  machine 
printers  and  color-mixers  may  aid  the  print-cutters  bv  refusing  to  use 
prints  cut  by  unorganized  labor.    The  bricklayers  may  aid  the  brick 
tile,  and  terra-cotta  workers  by  refusing  to  lay  brick  made  by  non-' 
union  workers.    But  cooperation  by  means  of  svmpathetic  strikes  is 
the  only  way  by  which  such  widely  separated  trades  may  help  one 
another,  and  the  expediency  of  even  this  form  of  cooperation  seems 
doubtful.  In  the  first  place,  the  hostility  to  the  strike  declared  in  1894 
by  the  railway-transportation  workers  in  favor  of  the  Pullman-car 
builders  indicated  that  strikes  in  behalf  of  such  remotely  related 
trades  are  held  in  much  disfavor  by  the  public,  even  when,  as  in  the 
above  instance,  all  parties  were  united  in  the  same  organization 
Moreover,  the  employers  consider  that  they  have  been  treated  very 
unfairly  when  their  employees,  to  whom  they  have  granted  favorable 
terms,  strike  in  behalf  of  a  trade  with  which  neither  party  has  any 
personal  relations.  Combination  between  such  remotely  related  trades 


RELATED  TRADES  IN  AMERICAN  UNIONS        379 

seems  undesirable.    If  they  do  attempt  to  combine,  federation  or 
merely  a  written  agreement  would  be  preferable. 

A  small  group  of  unions,  some  of  which  unite  trades  never  haying 
the  same  employer,  are  those  attempting  to  combine  all  workers 
making  goods  trom  the  same  material.    Frequently  the  manufactur- 
ers of  one  article  do  not  produce  other  articles  from  the  same  material. 
Their  employees  compose  an  entirely  separate  trade  and  are  never 
associated  in  the  same  industrial  establishment  with  the  workers  on 
the  other  articles.   An  example  was  the  Amalgamated  Rubber  Work- 
ers' Union,  which  was  composed  of  workers  on  all  kinds  of  rubber 
goods,  such  as  parts  for  mechanical  appliances,  bicycle  tires,  auto- 
mobile tires,  and  rubber  shoes.   The  men  who  make  rubber  tires  for 
bicycles  and  automobiles  possess  no  special  facility  for  making  rubber 
overshoes,  nor  do  employers  who  manufacture  rubber  overshoes  ever 
manufacture  rubber  goods  for  mechanical  appliances.    In  fact,  there 
is  a  territorial  division  of  production.    Rubber  overshoes  are  produced 
largely  in  New  England  and  rubber  goods  for  mechanical  appliances 
in  other  parts  of  the  country,  particularly  New  Jersey.   The  Amalga- 
mated Rubber  Workers'  Union  was,  therefore,  an  unnatural  com- 
bination of  groups  of  workers  having  no  interest  in  common.    Its 
membership,  indeed,  was  always  small,  and  it  soon  went  to  pieces. 
Another  example  is,  perhaps,  the  United  Brotherhood  of  Carpenters 
and  Joiners,  which  absorbed  quite  recently  the  machine  woodworkers 
and  furniture  workers  and  is  planning  soon  to  include  also  the  box- 
makers  and  wooden-ship  builders,  and  which  hopes  some  day  to  have 
jurisdiction  over  all  woodworkers  in  North  America.     Some  of  the 
trades  which  the  United  Brotherhood  of  Carpenters  and  Joiners  seeks 
thus  to  unite  possess  few  interests  in  common,  and  there  is  grave 
doubt  whether  real  unity  could  ever  be  secured  by  such  a  wide- 
reaching  organization.  r     1      j       j     • 

The  first  essential  for  a  successful  combination  of  related  trades  is, 
therefore  that  such  trades  have  the  same  employers.  If,  in  addition, 
such  a  combination  admits  neither  auxiliary  trades  nor  unskilled 
workers,  its  desirabilitv  will  not  be  questioned  by  trade-umon  leaders. 
In  fact,  the  only  debatable  question  is  whether  such  an  organization 
should  be  a  federation  of  national  craft  unions  or  an  amalgamation  of 
local  craft  unions.  If,  as  in  the  printing  industry,  the  lines  of  demar- 
cation between  the  trades  are  rigidly  fixed ;  and  if,  because  one  trade 


V 


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380       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

outnumbers  the  others,  an  amalgamation  may  disintegrate,  as  did 
the  International  Typographical  Union ;  and  if  a  satisfactory  balance 
of  power  cannot  be  secured  by  carefully  weighted  representation  in 
conventions  and  on  general  executive  boards,- a  federation  may  be 
preferable.   If,  as  in  the  building  industry  or  the  railway  industry 
the  related  crafts  have  been  long  and  successfully  organized  into 
separate  national  trade-unions,  there  will  be  much  objection  to  the 
dismemberment  of  these  associations,  and  the  first  successful  attempt 
at  combination  will  probably  be  a  loose  federation.   If  none  of  a 
.    group  of  related  crafts  outnumbers  greatly  the  others,  and  if  the 
r    divisions  between  trades  are  not  rigidly  fixed,  so  that  laborers  pass 
readily  from  one  kind  of  work  to  another,  the  successful  establish- 
ment  of  an  amalgamation  may  be  an  easy  task 

Two  matters  of  long  and  bitter  controversy  that  have  arisen  con- 
cerning combinations  of  trades  working  for  the  same  employers  have 
related  (i)  to  the  admission  of  auxiliary  trades  found  in  a  number 
of  industries  and  (2)  to  the  admission  of  unskilled  laborers  We 
shall  first  consider  the  method  of  organizing  auxiliary  trades.'   The 

!,l"n  ™TH"r'f  "''"  '^'^^"bution  among  several  industrial 

unions.    The  trade  autonomists  favor  their  combination  into  a  single 
craft  union.    In  behalf  of  the  policy  of  distributing  the  members  of 
an  auxiliary  trade  among  several  industrial  unions,  it  may  be  argued 
that  such  a  craft  gains  much  from  its  ability  to  cooperate  for  purposes 
of  collective  bargaining  with  other  employees  in  the  same  estaWish! 
ment.    Trades  like  the  patternmakers,  the  stationary  engineers  and 
he  stationao.  firemen  are  especially  handicapped  unless  the  rdated 
trades  aid  them  by  declaring  strikes  in  sympathy,  for  the  reason 
that  there  are  usually  so  few  of  these  workers'in  el^h  estfbHshm  n 
hat  the  employer  can  readily  find  sufficient  nonunionists  to  take 
heir  places.   On  the  other  hand,  cooperation  for  purposes  of  coT 
ectwe  bargaining  between  members  of  an  auxiliary  craft  in  different 
ndus  nes  IS  unnecessary.    It  is  not  even  needed  to  maintain  uni 
formity  of  wages    since  such  uniformity  is  required  only  between 
ompeting  establishments  in  the  same  industry.   In  favor  of  col in- 
ing  the  members  of  an  auxiliary  trade  into  one  craft  union  it  may  be 
argued  that  the  supply  of  workers  in  a  trade  can  be  effect      rregu 

etllTdurtS  "'■  "T'"^  "^  ^°  ""'■'«'•    "  distributed  Long 
several  industrial  umons,  limitation  of  apprenticeship  is  impracticable 


RELATED  TRADES  IN  AMERICAN  UNIONS        381 

and  there  is  no  way  of  preventing  the  members  in  one  industry  from 
takin"  the  places  of  fellow  craftsmen  in  other  industries  by  acting  as 
strike-breakers  or  by  offering  to  work  for  lower  wages.  At  the  same 
time  the  free  movement  of  the  members  of  the  trade  from  one 
industry  to  another  is  checked  by  the  erection  of  artificial  barriers. 

Those  members  of  an  auxiliary  trade  ^vho  have  had  to  undergo 
additional  training  in  order  to  do  the  work  in  a  particular  industry 
are  affected  very  indirectly  by  the  total  supply  of  workers  m  the 
craft  and  hence  may  amalgamate  very  profitably  with  other  em- 
ployees in  the  same  industry.   The  Carriage  and  Wagon  Workers 
international  Union  claims  that  the  carriage  blacksmiths  are  special- 
ists and  hence  can  gain  nothing  from  affiliation  with  the  union  of 
blacksmiths.   The  cutting-die  and  cutter  makers,  who  manufacture 
the  dies  used  in  cutting  cloth,  paper,  leather,  and  other  materials 
according  to  various  patterns,  declare  that  they  have  no  interests  in 
common  with  the  blacksmiths  and  machinists,  from  whom  their  ranks 
are  recruited.    Special  training  is  required  to  do  this  work,  and  as  the 
waste  of  material  makes  the  cost  of  teaching  new  hands  very  high, 
the  cutting-die  and  cutter  makers  are  only  slightly  affected  by  the 
demand  for  machinists  and  blacksmiths. 

When  the  members  of  a  trade  require  no  special  traimng  for  the 
work  in  each  of  the  industries  in  which  they  are  employed,  a  com- 
promise seems  necessary.  Trade-union  officials  have  suggested  that 
the  members  of  such  a  trade  might  belong  both  to  the  craf  union 
and  to  one  of  several  industrial  unions.  Power  to  declare  strikes  and 
to  bargain  with  employers  could  be  vested  in  the  industrial  unions. 
The  craft  union  could  limit  the  supply  of  workers  m  trade  and  pre- 
vent individual  competition  for  employment  between  them,  and  if  the 
scope  of  its  activities  were  limited  to  these  matters  there  need  be  no 
overlapping  of  functions  between  it  and  the  industrial  unions. 

The  second  question  to  be  considered  is  whether  the  skilled  and 
unskilled  workers  in  an  industry  should  be  combined  in  the  same 
organization.  Undoubtedly  the  unskilled  gain  greatly  from  such  an 
alliance.  Organizations  composed  wholly  of  unskilled  workers  such 
as  the  International  Brotherhood  of  Foundry  Employees,  the  Inter- 
national Association  of  Glass  House  Employees,  the  International 
Hod  Carriers'  and  Building  Laborers'  Union,  and  the  Interna- 
tional Association  of  Blast  Furnace  Workers   and  Smelters,   are 


382  TRADE  UNIONISM  AND  LABOR  PROBLEMS 
practically  impotent  to  improve  the  conditions  of  their  members 
Smce  their  work  requires  little  or  no  training,  strikes  are  uTeS' 
r/aXv  L  T  '7'r  T'  °^  -employed^ men  and  wlen  ca„ 
Carrie'^s  and  RriH  ,T  "^'^  P'^"^"  '^''^  International  Hod 
•       r    ^,       ^    ^"^  ^^''°'''''  U"'°"  ™^k^  no  mention  of  strikes 

trik  ITT"".  '"  '"''  ''''  international  organization  pay  no 
str  ke  benefits  and  rarely  declares  a  strike.  The  local  socE  of 
bu.ld,ng  laborers  have  derived  the  strength  to  maintain  striteand 
otherw.se  bargain  with  employers  from  the  aid  which  l^ey  have 
secured  from  the  skilled  trades  by  affiliation  with  loca  buildin! 
jades  co„„e,.s.  The  Laborers'  Union  Protective  SoSty  of  New 
J^ork  CUy,  composed  of  bricklayers'  and  masons'  helpers  has  secured 

rhtofThJ  n"    V  T^^""^"'  ^°^  ''^  members  J^tZgh 

„      •  .         ,  uenait  and  have  secured  the  inrlnsinn  ,^f 

provisions  favorable  to  the  hpln^rc  ;„  .u  •  inclusion  of 

contractors.  '^    '  '"  ^^'"  ^g^^ements  with  the 

inif  ■"T'u"  °^  ^  "^'^  organization  of  unskilled  workers  in  all 
ndustnes  has  been  suggested  by  trade-union  officials.    The  Laborer' 
nternafona    Protective  Union,  with  jurisdiction  over  al    unskH   d 
and  general  laborers,  male  and  female,  was  formed  severa  vearT.ln 
but  never  attained  any  real  importance.    The  constant    idenf       ^  ' 
gration  into  the  United  States  makes  any  eLtive  regit U    72 
supply  of  general  laborers  impracticable     Moreover  !fn,l   1  H        ^ 
erscanbekent  fn;thf„i  .„  ,1,        •         ,        moreover,  unskilled  work- 
can  oe  Kept  laithful  to  the  union  on  y  with  great  diffirnl.,,    r...  • 
unemployment,  which  is  very  freciuent  amon"  tl      ~^^y-  ^^""ng 
for  failure  to  pay  dues    for  ar.^a       T,^!       '  "''^  ^'^  ^''P^''^^ 
their  labor  at  Us  tt;%;:Vn  rscl"o?:a  if  T^'  "  '7  ^"""^ 
one  large  organization  of  unskilled  worl^rs    „'    '  J  he^^^^^^^^^^^^ 

these  workers,  with  their  low  wages  and  freauent  ,Z     ,  ^ 

maintain  such  benefits  seems  doubtful  ^         ""employment,  to 

The  chief  hope  of  the  unskilled  workers  rests  in  »n  ,ii- 

;  mfa^s-uch"  "^^''■■"^'^>="■"  ""'^'"^  sSan  rn  rr;; 

contrary,  such  amalgamation  entails  a  sacrifirp   cin..  .,  .  ^ 

ynote  ot  the  dommant  unionism  has  been  self-interest.   The 


ill 


RELATED  TRADES  IN  AMERICAN  UNIONS        383 

consistent  pursuance  of  this  policy  by  the  American  Federation  of 
Labor  and  its  constituent  international  unions  has  made  them  succeed 
where  the  Knights  of  Labor,  with  its  altruistic  ideals  of  brotherhood, 
failed.    Following  this  policy,  the  skilled  trades  have  refused  to  unite 

with  the  unskilled. 

There  are  aristocracies  even  among  the  aristocrats.    Certain  trades, 
whose  members  possess  a  higher  degree  of  efficiency  and  training  than 
do  their  fellow  employees,  have  refrained  from  entangling  alliances 
The  exclusiveness  of  the  locomotive  engineers  has  undoubtedly  helped 
to  prevent  the  successful  federation  of  all  railway  employees.    The 
bricklayers  have  held  aloof  from  local  and  national  federations  of 
the  building  trades.   The  marine  engineers  have  refused  to  affiliate 
with  the  International  Seamen's  Union.   Years  ago  the  window-glass 
blowers  and  gatherers  were  reluctant  to  amalgamate  with  the  less 
skilled  window-glass  cutters  and  flatteners.   Today  the  situation  is 
reversed     The  introduction  of  machinery  has  greatly  reduced  the 
skill  of  the  blowers  and  gatherers,  and  the  cutters  and  flatteners,  who 
now  possess  the  greater  skill,  have  seceded  from  the  amalgamation 
of  window-glass  workers  to  form  an  independent  organization.    The 
lasters  were  for  some  vears  the  aristocrats  among  the  boot  and  shoe 
workers     The  introduction  of  machinery  greatly  reduced  the  skill  of 
all  boot  and  shoe  workers  except  the  lasters.   About  1885  the  lasters 
formed  a  strong  union,  while  the  other  trades  were  unorganized 
or  maintained  weak,  struggling  unions.    In  consequence,  the  lasters 
gained  at  the  expense  of  the  members  of  other  crafts,  for  the  em- 
ployers fearing  to  provoke  them  to  resistance,  permitted  their  wages 
to  remain  the  same  when  reducing  those  of  the  other  trades  and  even 
secured  reimbursement  for  increases  in  the  wages  of  the  lasters  by 
imposing  reductions  on  those  of  the  other  crafts.    Similarly,  the 
cotton  mule  spinners  were  able  for  many  years  to  obtain  high  wages 
at  the  expense  of  the  other  unorganized  groups  of  workers  m  the 

cotton  industry. 

Introduction  of  machinery  and  further  division  of  labor  have  forced 
many  of  these  highly  skilled  trades  from  their  position  of  aloofness. 
With  the  replacement  of  the  mule  by  the  ring  frame,  which  can  be 
manipulated  by  women  and  children,  cotton  mule  spinning  has  be- 
come a  vanishing  craft.  After  1890  the  new  lasting  machinery  greatly 
demoralized  the  lasters'  unions.    Certain  processes  could  be  done  by 


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384       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

boys,  and  one  could  pass  fairly  rapidly  from  the  easy  to  the  more 
difficult  parts  of  the  work.  The  lasters  were,  therefore,  quite  willing 
to  join  with  the  other  trades  in  forming  a  single  amalgamation  of 
boot  and  shoe  workers  in  1895. 

This  breaking  down  of  the  barriers  between  trades  is  bringing 
about  for  the  most  part,  however,  only  the  amalgamation  of  groups 
whose  work  requires  some  degree  of  skill.    The  unskilled,  who  are 
most  helpless,  remain  largely  without  effective  organization.    Never- 
theless, as  division  of  labor  becomes  more  minute,  as  the  old  method 
of  apprenticeship  fails,  and  as  the  groups  of  skilled  and  semiskilled 
are  being  recruited  in  an  increasing  number  of  instances  by  the  pro- 
motion of  the  common  laborers  required  for  the  many  odd  jobs  exist- 
ing in  every  industrial  establishment,  the  other  trades  are  manifesting 
a  growing  tendency  to  admit  such  potentially  dangerous  competitors 
to  their  unions.    Thus  the  plumbers  and  the  steam  fitters,  the  boiler- 
makers,  the  tile-layers,  the  blacksmiths,  the  pressmen,  and  some  other 
trades  admit  their  helpers  to  membership  in  their  unions,  because, 
while  these  helpers  are  not  apprentices,  they  have  opportunity  to 
learn  the  trade  and  often  become  efficient  journeymen.    The  Amalga- 
mated Meat  Cutters  and  Butcher  Workmen  of  North  America  admits 
workers  in  the  meat  industry,  irrespective  of  skill ;  and  in  1904  all 
classes  of  employees  in  the  Chicago  packing  houses  went  on  strike 
to  raise  the  wages  of  the  least  skilled  and  most  poorly  paid,  the 
reason  being  that  labor  has  been  so  minutely  subdivided  in  the  pack- 
ing houses  that  the  immigrant  can  be  trained  in  a  few  months  to  even 
the  most  difficult  of  the  processes.    Some  of  those  who  are  handling 
trucks  and  doing  other  odd  jobs  have  been  displaced  from  more 
skilled  positions.    They  can  slaughter  and  cut  up  the  whole  ox,  hog, 
or  sheep,  and  would  be  glad  to  regain  their  old  positions  at  less 
wages  than  those  now  holding  them  are  receiving.    Moreover,  the 
wages  of  all  employees  in  the  packing  houses  bear  a  fixed  proportion 
to  the  amount  paid  to  the  least  skilled.    So  the  Amalgamated  Meat 
Cutters   and    Butcher   Workmen   desires   control   over   the  general 
laborers,  and  declared  the  strike  of  1904  in  their  favor  to  keep  them 
satisfied  with  their  present  employment  and  indirectly  to  raise  the 
wages  of  the  more  skilled  employees.    Instances  in  which  the  self- 
mterest  of  the  skilled  workers  demand  their  amalgamation  with  the 


RELATED  TRADES  IN  AMERICAN  UNIONS        3^5 

unskilled  are  still  rare,  however.  If  common  laborers  are  admitted  in 
the  near  future  to  unions  of  other  workers  in  the  same  industry,  they 
will  be  admitted  not  from  self-interest  but  from  more  altruistic 
motives,  from  a  growing  spirit  of  class  consciousness  attended,  perhaps, 
by  a  correspondingly  growing  realization  of  class  responsibility. 


Theodore  W.  Glocker 


University  of  Tennessee 


THE  NATIONAL  UNION 


387 


II 


If 


XXVII 

THE  DOMINANCE  OF  THE  NATIONAL  UNION  IN 
AMERICAN  LABOR  ORGANIZATION^ 

'  I  ^RADE-UNIONISTS  in  all  industrial  countries  have  developed 
X   a  number  of  distinct  forms  of  grouping.     At  the  present  time, 
for  example,  American  trade-unionists  are  organized  into  local  trade- 
unions,  national  trade-unions,  city  federations,  a  national  federation, 
local  trades  councils,  and  national  trades  councils.-    The  same  union- 
ist may  be  included  in  all  of  these  six  forms  of  grouping.    A  Balti- 
more printer,  for  example,  may  be  a  member  of  the  local  union  of 
his  trade— the  Baltimore  Typographical   Union;    of  the  national 
union  of  his  trade— the  International  Typographical  Union ;  of  the 
city  federation  — the  Baltimore  Federation  of  Labor;  of  a  national 
federation— the  American  Federation  of  Labor ;   of  a  local  trades 
council— the  Baltimore  Allied  Printing  Trades  Council ;  and,  finally, 
of  a  national  trades  council— the  International  Allied  Printing  Trades 
Association.^     Each  of  these  forms  of  grouping  might,   therefore, 
embrace  all  the  trade-unionists  in  the  United  States.   As  a  matter  of 
fact,  some  of  them  include  in  their  membership  only  a  small  part  of 
the  total  number  of  trade-unionists.    The  number  of  members  of  all 
the  local  trades  councils  in  the  United  States,  for  example,  is  probably 
less  than  one  fourth  of  the  total  number  of  trade-unionists. 

iprom  the  Quarterly  Journal  of  Economics,  Vol.  XXVII  (1913),  pp  455-481 

2  There  are  other  forms  of  grouping,  as,  for  example,  state  federations  and 
state  and  district  unions  of  the  local  unions  in  particular  trades,  but  these  have 
played  a  relatively  small  part  in  the  organization  of  labor  in  the  United  States 
and  are,  therefore,  omitted  from  the  present  discussion. 

3  The  terminology  of  American  trade-union  structure  is  much  confused  The 
city  federation,  as  it  is  called  here  (that  is,  the  federation  of  the  local  unions  in 
a  city),  is  known  by  various  other  names;  for  example,  "labor  assembly" 
'trades'  union,"  "trades  council,"  and  "central  labor  union."  In  the  constitu- 
t!on  of  the  American  Federation  of  Labor  city  federations  are  denominated 

central  trade  and  labor  unions"  or,  more  briefly,  "central  bodies"  The  local 
trades  councils,  as  they  are  called  here  (that  is,  the  local  unions  of  allied  trades 
in  a  particular  aty),  are  also  frequently  referred  to  as  "central  bodies." 

386 


The  forms  of  trade-union  grouping  have  steadily  increased  in 
number.  The  local  trade-union  dates  its  origin  from  the  beginning 
of  the  nineteenth  century;  the  city  federation  from  1827;  the 
national  trade-union,  as  an  effective  form  of  organization,  from  1850. 
Trades  councils,  local  and  national,  are  a  development  of  the  last 

twenty-five  years. 

The  interrelations  of  these  forms  of  grouping— the  elements  in 
American  labor  organization— have  been  determined  slowly,   and 
from  time  to  time  the  changing  needs  of  the  trade-union  movement 
have  necessitated  readjustments  of  these  relations.   As  might  be  ex- 
pected from  the  political  analogy,  the  relationship  which  has  proved 
most  practicable  has  been  the  dominance  of  some  one  of  the  forms  of 
grouping  over  the  others.   Whenever  the  tide  of  trade-unionism  has 
risen  markedly,  the  desire  to  give  unity  to  the  labor  movement  has 
led  to  the  assumption  of  leadership  and  control  by  one  or  another  of 
the  forms  of  grouping.  In  the  history  of  American  labor  organization 
four  distinct  structural   forms  are  distinguishable,  each  of  which 
emerges  in  a  time  of  rapid  growth  in  the  trade-union  movement.    The 
periods  in  the  development  of  the  structure  of  American  labor  or- 
ganization may  accordingly  be  roughly  defined  as  extending  from 
1800  to  1815,  from  1827  to  1838,  from  1879  to  1888,  and  from  1897 
to  the  present.   In  the  years  between  these  periods  the  labor  move- 
ment was  relatively  weak,  and  the  relations  of  the  various  forms  of 
grouping  were  less  sharply  defined. 

In  the  earliest. period— from  the  end  of  the  eighteenth  century  to 
about  181 5— the  local  union  was  the  only  form  of  trade-union 
grouping.  Among  the  local  unions  of  different  trades  in  the  same  city 
therejwas  no  substantial  connection ;  communication  between  the 
local  unions  of  the  same  trade  in  different  cities  was  rare,  and 
cooperation  among  them  slight. 

The  second  period,  extending  from  1827  to  1838,  was  marked  by 
the  rise  of  the  city  federation,  or,  as  it  was ihen_called,,  the  trades' 
union.  The  admirable  study  of  this  period  by  Professor  Commons 
and  Miss  Sumner  shows  that  the  labor  movement  of  the  period  was 
largely  directed  and  controlled  by  the  city  federations.^  Attempts 
to  form  national  trade-unions  were  made,  but  failed.  The  city 
federations  united  to  form  a  national  federation,— the  National 
1  Documentary  History  of  American  Industrial  Society,  Vols.  V,  VL 


^1^ 


388       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Trades'  Union,--but  this  exercised  practically  no  power  and  its 
life  was  short. 

A  characteristic  feature  of  American  trade-unionism  from   1865 
to  1888  was  the  formation  of  a  number  of  national  federations  in 
which  the  controlling  elements  were  the  city  federation  and,  to  a  less 
extent,  the  local  union.    The  International  Industrial  Assembly  of 
North  America,  organized  in  1864,  the  National  Labor  Union,  active 
from  1866  to  1870,  the  Industrial  Congress,  organized  in  1873,  and 
the  Knights  of  Labor,  organized  as  a  national  federation  in  1878, 
were  alike  in  this  respect.    These  national  federations  were  designed 
to  exercise  functions  distinct  from  those  exercised  by  the  national 
and  local  unions,  but  the  evident  desirability  of  bringing  the  entire 
labor  movement  into  unity  led  in  the  latest  and  strongest  of  these 
organizations,  the  Knights  of  Labor,  to  the  gradual  development  of 
the  idea  that  the  national  federation  should  be  dominant  in  the 
structure  of  labor  organization.    The  opposition  of  the  national  trade- 
unions  to  a  structural  form  in  which  the  national  union  became  sub- 
ordinate  to  the  national  federation  led  to  the  bitter  struggle  between 
the  Knights  and  the  national  unions  which  characterized  the  years 
from  1885  to  1888. 

The  fourth  period  in  the  structural  history  of  American  trade- 
umomsm— from  1897  to  the  present— has  been  distinguished  by 
the  increasing  control  exercised  by  the  national  trade-union  over  the 
other  forms  of  grouping.  This  development,  which  forms  the  subject 
of  the  present  paper,  will  be  treated  with  reference  to  (i)  local 
unions,  (2)  national  federations,  (3)  city  federations,  (4)  local  and 
national  allied-trades  councils. 

I 

The  present  dominance  of  the  national  union  in  American  labor 
organization  is  based  upon  the  steadily  increasing  control  exercised 
by  the  national  unions  over  the  local  unions.  This  development 
presents  two  aspects.  In  the  first  place,  the  degree  of  control  which 
the  national  union  exercises  over  its  affiliated  local  unions  is  impor- 
tant,  since  both  the  power  and  the  desire  of  the  national  union  to 
control  the  other  forms  of  labor  organization  are  directly  proportional 
thereto.  Secondly,  the  extent  to  which  local  unions  are  affiliated  with 
some  national  union  is  also  important,  since  if  a  large  part  of  the 


THE  NATIONAL  UNION 


389 


local  unions  were  independent,  the  power  of  the  national  union  to 
control  the  other  forms  of  labor  organization  would  be  much  less 

than  it  is. 

In  both  respects  the  control  of  the  national  unions  over  the  local 
unions  has  increased  rapidly  in  recent  years.    The^  increase  in  the 
_^gree  of  control  over  the  affiliated  local  unions— ordinarily  described 
-^  6SitSSatie!i--iias  been  due  to  a  variety  of  causes,  chief  among 
wliich  are  the  establishment  of  nationally  administered^  beneficiary 
features,  the  financing  of  strikes  by  the  national  unions,  and  the 
negotiation  of  national  agreements  with  employers.    These  extensions 
of  activity  on  the  part  of  the  national  union  have  necessitated  an 
increasingly  stricter  control  by  the  national  union  over  its  affiliated 
local  unions,  which  has  exhibited  itself  in  many  ways,  such,  for 
example,  as  the  national  regulation  of  admission  requirements,  the 
national  control  of  strikes,  and  the  adoption  of  national  working  rules.^ 
The  extension  of  control  by  the  national  union  over  a  larger  and 
larger  number  of  the  local^  unions  in  its  trade  or  industry  is  closely 
"connecTeTwith  the  gFowth  in  centralization.    The  same  considerations 
which  lead  affiliated  local  unions  to  transfer  a  large  part  of  their 
activities  to  a  national  organization  are  influential  in  leading  un- 
affiliated unions  to  ally  themselves  with  the  national  union  in  their 
trade.    The  advantages  to  be  obtained,  however,  have  not  been  the 
only  force  making  for  the  affiliation  of  the  independent  unions.    The 
national  unions  have  exerted  pressure  on  the  unaffiliated  unions  by 
discriminating  against  their  members  who  seek  work  in  other  cities 
and,  wherever  practicable,  by  establishing  rival  local  unions.    More- 
over, as  will  be  shown  below,  the  national  unions  have  used  their 
increasing  control  of  the  city  federation  and  the  local  trades  council 
to  force  the  independent  unions  to  affiliate. 

The  result  has  been  that  American  local  trade-unions  are  con- 
nected with  some  national  union  probably  more  generally  than  the 

1  Various  aspects  of  this  development  have  been  described  in  detail  by  several 
writers  See  Adams  and  Sumner,  Labor  Problems,  pp.  228-230;  Carlton,  History 
and  Problems  of  Organized  Labor,  pp.  QS-no;  McCabe,  The  Standard  Rate  in 
American  Trade  Unions,  pp.  120-178;  Wolfe,  Admission  to  American  Trade 
Unions,  pp.  11-33;  Spedden,  The  Trade  Union  Label,  pp.  32-51;  Sakolski,  The 
Finances  of  American  Trade  Unions,  pp.  12-20,  46;  Kennedy,  Benefiaary 
Features  of  American  Trade  Unions,  pp.  106-120;  Glocker,  The  Government 
of  American  Trade  Unions,  chaps,  v,  vi;  Barnett,  The  Printers,  pp.  29-40. 


390       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

local  unions  in  any  other  country.  It  is  one  of  the  curious  phenomena 
of  trade-unionism  that  although  local  and  sectional  trade-unions  still 
survive  in  England,  they  have  almost  entirely  disappeared  in  the 
United  States,  despite  the  enormously  greater  area  covered.  In  the 
United  Kingdom,  for  example,  the  following  unions  of  compositors 
were  in  existence  in  1910 :  London  Compositors,  Dublin  Typographi- 
cal Society,  Typographical  Association,  Scottish  Typographical  Asso- 
ciation.^ In  the  United  States  in  the  same  year  there  was  no  important 
independent  local  union  of  compositors  or  sectional  association  of 
such  unions.  All  the  local  unions  were  affiliated  with  the  Interna- 
tional Typographical  Union.  Essentially  the  same  contrast  is  found 
ir  a  number  of  other  trades.^ 


II 


?- 


As  long  as  the  national  unions  had  slight  control  over  their  affiliated 
local  unions  they  did  not  seriously  object  to  the  formation  of  national 
federations  in  which  city  federations  and  local  unions  were  the 
dominant  elements.  With  the  growth  of  the  power  of  the  national 
union  over  the  local  unions,  the  national  unions  in  which  centrali- 
zation was  greatest  became  strongly  dissatisfied  with  such  national 
federations,  particularly  if  they  encroached  upon  the  functions  of 
the  national  union.^ 

The  question  did  not  become  acute,  however,  until  the  great  in- 
crease in  the  strength  of  the  Knights  of  Labor,  and  the  transformation 
in  the  attitude  of  that  organization  toward  the  national  unions.  In 
1886  the  national  trade-unions,  desirous  of  defending  themselves 
against  the  threatened  domination  of  the  Knights,  took  over  and 
reorganized  the  Federation  of  Organized  Trades  and  Labor  Unions 

1  Labour  Department  Report  on  Trade  Unions  in  1908-1910,  p.  50. 

2  No  data  are  available  as  to  the  number  of  independent  local  unions  in  the 
United  States  as  a  whole,  but  some  indication  of  the  number  may  be  obtained 
from  the  annual  reports  made  to  the  Massachusetts  Bureau  of  Statistics  by 
labor  organizations  in  that  state.  In  iqio,  according;  to  information  kindly 
furnished  by  the  Director  of  the  Bureau,  of  some  1250  local  unions  in  Massa- 
chusetts all  except  twenty  were  affiliated  with  some  national  union  or  with  the 
American  Federation  of  Labor.  See  also  the  Bureau's  Fourth  Annual  Report 
on  Labor  Organizations,  191 1,  p.  76. 

•^For  an  account  of  the  attitude  of  the  stronger  national  unions  towards  the 
national  federations  from  1865-1885  see  Kirk,  National  Labor  Federations  in 
the  United  States,  pp.  17-26. 


THE  NATIONAL  UNION 


391 


of  the  United  States  and  Canada,  a  national  federation  which  had 
been  organized  in  1881.    According  to  the  original  ^^ff  ^^^^^^^^^ 
Federation  the  national  unions  were  allowed  one  delegate  if  their 
membership  was  less  than  400,  two  delegates  if  4000,  three  if  8000, 
Lr  if  16,000,  five  if  32,000,  and  so  on.    Each  local  trades  assemHy 
or  city  federation  was  allowed  a  single  delegate  irrespective  of  the 
number  of  its  members.    In  1882   the  plan  of  representation  was 
slicrhtly  altered.    Assemblies  of  the  Knights  of  Labor  and  local  trade- 
unions  were  given  the  same  representation  as  city  federations,  and 
state  and  provincial  federations  were  allowed  two  delegates.    In  sev- 
eral of  the  sessions  of  the  Federation  prior  to  1886  the  voting  strength 
of  city  federations  and  local  unions  was  greater  than  that  of  the 

national  unions.^  . 

^   In  1886,  when  the  Federation  assumed  its  present  title -the  Amer- 
ican Federation  of  Labor-the  basis  of  representation  was  altered  so 
as  to  exclude  from  representation  all  local  unions  of  trades  m  which 
national  unions  exPsled-  This  change  did  not  entirely  satis  y  the 
national  unions,  since  it  was  possible  that  a  large  number  of  loca 
unions  in  those  trades  in  which  there  were  no  national  unions  might 
be  affiliated  directly  with  the  Federation.^    Moreover  the  representa- 
tives of  city  federations  might  easily  have  become  sufficiently  numer- 
ous to  outvote  the  delegates  of  the  national  unions.   A  year  later, 
in  1887,  the  national  unions,  therefore,  made  their  control  of    he 
Federation  unassailable  by  the  adoption  of  the  provision  that  if  a 
roll  call  was  demanded*  each  delegate,  except  those  of  city  or  state 
federations,  might  cast  one  vote  for  every  one  hundred  members 

nn  1883,  for  instance,  fifteen  of  the  twenty-seven  delegates  were  representa- 
tives of  tol  trade-unions,  city  federations,  and  state  .federations 

2  National  unions  were  given  tlie  same  representation  as  before,  and  eactt 
1  1  .rdktrict  trade!  organization  or  federated  body  not  connected  wih,  or 
havln/a  N^Jti  ofl^t^rnational  head  affiliated  with,  this  Federation"  was 

*"°T'dek:at:'f?:m  the  Internationa,  Typographical  Union  to.  the  se.ion  of 
the  Federation  held  in  1886  suggested  in  his  report  to  his  "mon  that  local 
the  f™""'""  ^^    ^ouid  be  so  strongly  represented  as  to  out- 

S  r  Ttle  dXacc  Ued  delegates  from  distinctive  "f  ional  and  in  er- 
natTonal  bodies"  (Proceedings  of  the  Internauonal  Typographical  Union,  1887, 

"•  Mn',8S8  it  was  provided  that  a  roll  call  might  be  demanded  by  one  fifth  of 
the  delegates  a^d  in  XS8P  the  present  rule  that  a  roll  caU  may  be  demanded  by 
one  tenth  of  the  delegates  was  adopted. 


ii 


If 


I 


392       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

which  he  represented.^  The  representatives  of  city  and  state  feder- 
ations were  allowed,  as  before,  only  one  vote.  The  delegates  of  local 
unions  directly  affiliated  with  the  Federation  may  cast  one  vote  for 
each  hundred  members,  but  the  total  membership  of  these  unions  is 
small  compared  with  that  of  the  national  unions,  and  on  account  01 
the  expense  many  of  them  are  unable  to  send  delegates. 

By  these  changes  the  national  unions  were  given  an  overwhelmingly 
large  votmg  power  in  the  Federation.  The  convention  of  191 1  will 
furnish  an  illustration.  The  total  number  of  delegates  present  was 
349.  Of  these,  228  were  delegates  of  national  unions,  25  of  state 
federations,  67  of  central  federations,  21  of  trade  and  federal  labor 
unions  directly  affiliated,  and  6  of  fraternal  organizations.  The  num- 
ber of  delegates  of  national  unions  was  nearly  two  thirds  of  the  total 
number,  and  the  voting  strength  on  roll  call  of  the  national  unions 
was  17,104  of  a  total  vote  of  17,240.  Moreover,  it  has  become  cus- 
tomary for  the  national  unions  to  send  as  part,  at  least,  of  their 
delegation  important  officials  of  the  national  union.  The  sessions  of 
the  federation  are  thus  to  a  very  considerable  extent  councils  of  the 

executives  of  the  national  unions.        ""~" '  " 

Throughout  the  whole  period  since  1886  the  national  unions  have 
been  more  and  more  firmly  resolved  that  the  trade-union  movement 
should  not  be  transformed  into  that  semipolitical  form  which  has 
always  characterized  it  when  the  city  federation  and  local  union  have 
had  control  of  the  national  federation.  On  several  occasions  repre- 
sentatives  of  the  city  federations  have  complained  at  the  sessions  of 
the  Federation  that  their  voting  strength  is  too  small.  In  1900  for 
instance,  a  resolution  providing  that  each  delegate  from  a  national 
union  should  be  allowed  only  a  single  vote  on  roll  call  was  introduced 
but  was  voted  down  without  discussion.^^  It  was  proposed  in  1900  that 
the  delegates  from  city  federations  should  be  permitted  to  cast  the 

of  i88,*^h/ n""'^  '^  *^'  "^t-^"'''  ^'■^"^  '^'  Typographical  Union  to  the  session 
of  1887  the  purpose  in  making  this  change  was  stated  as  follows-  "The  bas^s 

central  labor  unions  and  state  assemblies  a  vote   out  of  proportion  to  thHr 
coS^fThe  ^"^.^^^^1!;^-;"-  bodies  to  exert  an   undrintence  V  th^^^ 
no  dolt  'tfr      '^l  ^''^T'"''-    ^"'  '^^  '^'^  ^^'^  ^h-  constitution  vvould 
only      This  can  bTdolTfn'  "  '?  ''"^^*  "^^^^"^'  ^"^  international  bodie 

of  th.  T  ;       !        ,  i     ""  ^^  ^^^  "^"^'^  '^^^''^"'  '^  desirable "    (Proceedings 

of  the  International  Typographical  Union,  1888,  p.  1:^7)  ^^^oceedmgs 

^Proceedmgs  of  the  American  Federation  of  Labor,  1900,  pp.  40,  155. 


THE  NATIONAL  UNION 


393 


votes  of  local  unions  directly  affiliated  with  the  Federation  and  con- 
nected with  the  city  federation,  but  this  proposal  also  was  defeated.^ 
In  1902  an  interesting  attempt  was  made  to  organize  a  new  na- 
tional federation.  The  Milwaukee  city  federation  issued  a  circular 
letter  calling  a  national  convention  to  be  composed  of  the  representa- 
tives of  city  federations.  The  executive  council  of  the  American 
Federation  of  Labor  immediately,  to  quote  their  account,  "used  our 
crood  offices  to  persuade  the  central  labor  unions  and  other  central 

bodies  from  pursuing  this  mistaken  course "    The  plan  was  not 

abandoned,  however,  and  at  the  session  of  the  Federation  in  1902 
Mr  Victor  Berger,  the  delegate  from  the  Milwaukee  city  federation, 
introduced  a  resolution  providing  for  a  convention  of  delegates  from 
city  federations  in  cities  of  over  50,000  inhabitants  "to  consider  the 
conditions  and  evils  peculiar  to  the  large  cities  and  dangerous  and 
oppressive  to  the  laboring  people  living  therein."  Despite  Mr.  Berger's 
assurance  that  the  Milwaukee  city  federation  "had  no  design  to 
organize  a  body  antagonistic  to  the  A.  F.  of  L.,"  a  committee  of 
the  Federation  reported  unfavorably  on  the  project  on  the  ground 
that  there  were  "  already  adequate  means  to  promote  such  propaganda 
through  the  various  local,  central,  and  state  bodies."  ^    The  proposed 
federation  would  have  been  practically  identical  in  its  composition 
with  the  long  line  of  national  federations  which  began  with  the 
National  Trades'  Union  of  1834  and  ended  with  the  Knights  of  Labor. 
The  number  of  national  unions  affiliated  with  the  American  Fed- 
eration of  Labor  Ms  increased  steadily  since  1897.   In  19 11  the  only 
important  national  unions  not  in  affiliation  with  the  Federation  were 
the  Locomotive  Engineers,  the  Locomotive  Firemen  and  Engmemen, 
the  Railroad  Trainmen,  the  Railway  Conductors,  the  Flint  Glass 
Workers,  and  the  Bricklayers  and  Masons.    The  total  membership 
of  the  nonaffiliated  unions  in  191 1,  at  a  liberal  estimate,  did  not 
exceed  600,000,  while  the  membership  of  the  affiliated  unions  was 
approximately  1,800,000. 

No  rival  national  federation  has  been  able  in  this  period  to  offer 
effective  competition.  The  Knights  of  Labor  has  been  practically  an 
extinct  organization.  The  American  Labor  Union,  organized  in  1902 
to  promote  industrial  unionism,  went  out  of  existence  in  1905.   The 

1  Proceedings  of  the  American  Federation  of  Labor,  1900,  p.  iS5- 
2/rf,  1902,  pp.  49,  no,  205. 


lilli 


394       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Industrial  Workers  of  the  World,  organized  in  1905  as  the  successor 
of  the  American  Labor  Union,  lost  in  1907  the  support  of  its  only 
important  national  union,  the  Western  Federation  of  Miners,  which 
affiliated  in  19 11  with  the  American  Federation  of  Labor.  The  mem- 
bership of  the  Industrial  Workers  of  the  World — in  191 1  about 
10,000 — is  relatively  insignificant. 

Ill 

The  control  of  the  American  Federation  of  Labor  by  the  national 
unions  has  not  only  been  important  in  itself,  but  through  the  Fed- 
eration the  national  unions  have  acquired  such  control  as  they  now 
have  over  the  city  federations.  In  every  time  of  labor  unrest  since 
1827  city  federations— known  variously  as  trades'  unions,  working- 
men's  assemblies,  district  assemblies,  or  central  bodies— have  come 
into  existence  in  the  chief  industrial  centers.  In  the  earlier  periods 
of  American  trade-union  history  these  organizations  called  sympa- 
thetic strikes,  declared  boycotts,  and  sustained  strikers  with  financial 
aid.  To  many  of  their  activities  the  national  unions  had  no  objection, 
but  at  other  points  conflict  occurred.  With  the  increasing  centraliza- 
tion of  the  national  unions  it  became  intolerable  that  their  policies 
should  be  interfered  with  by  local  federations. 

The  control  exercised  by  the  Federation  of  Labor  over  city  feder- 
ations is  based  on  the  preference  shown  by  local  unions  for  city 
federations  affiliated  with  the  Federation  as  against  independent  city 
federations,  since  the  Federation  can  obviously  not  impose  rules  on 
unaffiliated  organizations.  In  191 1  there  were  631  city  federations 
affiliated  with  the  American  Federation  of  Labor.  The  number  of 
independent  city  federations  is  at  present  very  small.^  There  have 
been,  however,  even  within  recent  years  important  independent  city 
federations,  and  some  of  these  were  in  cities  in  which  there  were 
also  city  federations  affiliated  with  the  Federation. 

The  Federation  has  been  able  to  attach  to  itself  so .  nianyjcity 
federations  largely  through  the  steady  pressure  of  the  national  unions 
on  their  local  unions.  In  1893,  by  a  provision  in  the  constitution  of 
the  American  Federation  of  Labor,  it  was  made  ''the  duty"  of  all 

1  The  secretary  of  the  American  Federation  of  Labor,  Mr.  Morrison,  informs 
the  writer  that  in  November,  igi2,  in  only  two  cities  of  considerable  popula- 
tion were  there  independent  city  federations. 


THE  NATIONAL  UNION 


395 


»'  f ^  incf nirt "  their  local  unions  to  join  the 

K:c."^^»rs:;ir .;"-'. .:.  ,l.  »*. ., 

the  Federation.^^  ^     .    „^  .„  affiliated  city  federation  have 

r  r "ndX  .0  'persuade  .e  offices  ^^^-  -^ffiS 

to  bring  pressure  ^^  ^^^  ^.^^^^^^^^'^'^  ^'^  '''^'- 
federation.     In  1907  the  delegate  trom  t  >        resolution 

rJ'tedlT  t:ZT^BoX'to\ny  federations, 
rrjTcorerrnlber  oMocal  unlo.^^^^^^^^^^^^  - 
tional  unions  affiliated  with  the  Federat  on  ^^^^  ^"'^JJ^^j^^  ;„. 

rTeration.   The  convention,  however,  merely  reiterated  its  mstruc 

.Proceedings  of  the  Amen-  Fede-^^^^^^  of  ^^^^^^J^^r^  _,„,„„, 

nn  iqoi  a  commiUec  °V     ■        .r,«ilWte   said   "Your  committee  reports 
which  aimed  at  forcing  local  umons  U>  affl^.  sa^d,         ^^^^^^^^  ^^^^  ^^ 

adversely,  for  the  reason    ^a    tte  J^™"^^     (Proceedings,  1901,  p.  .98). 

'ntLXfoTltmeTS  FedttTon  of  Labor,  x,o,,  pp.  .0,  .3. 

*Id.  i909>  P-  279. 


ngiii 


396       TR.ADE  UNIONISxM  AxND  LABOR  PROBLEMS 

the  city  federation  has  no  power  to  retain  local  unions,  its  conduct 
must  commend  itself  to  the  local  unions  or  they  will  leave,  and  the 
seceding  unions  may,  if  they  see  fit,  form  a  rival  city  federation. 
No  more  effectual  check  on  the  exercise  by  city  federations  of  any 
real  power  over  the  constituent  unions  could  well  have  been  devised. 

I      Although  the  city  federation  has  not  yet  been  brought  sufficiently 
under  the  control  of  the  national  unions  acting  through  the  Federation 
to  make  it  appear  desirable  to  the  national  unions  that  local  unions 
should  be  forced  to  affiliate,  a  beginning  in  such  control  has  been 
made.    The  first  and  most  important  step  in  this  direction  was  to 
limit  the  power  of  the  city  federations  to  admit  local  unions.    Under 
the  constitution  of  the  American  Federation  of  Labor,  until  1886,  a 
city  federation  might  admit  local  unions  at  its  own  discretion.    The 
constitution  of  1886  provided  that  city  federations  were  not  to  admit 
delegates  "from  any  local  organization  that  is  hostile  to  the  objects 
of  this  Federation  or  that  has  been  suspended  or  expelled   by  a 
National  or  International  organization  of  their  trade."    The  rule  was 
amended  at  various  times,  chiefly  in  order  to  make  its  provisions  more 
exphcit,^  but  since  1897  it  has  been  substantially  in  its  present  form.- 
As  it  now  stands  it  reads  as  follows  : 

No  Central  Labor  Union,  or  any  other  central  body  of  delegates 
shall  admit  to  or  retain  in  their  councils  delegates  from  any  local  or- 
ganization that  owes  its  allegiance  to  any  other  body.  National  or 
International,  hostile  to  any  affiliated  organization,  or  that  has  been 
suspended  or  expelled  by,  or  not  connected  with,  a  National  or 
International  organization  of  their  trade  herein  affiliated  under 
penalty  of  having  their  charter  revoked  for  violation  of  their  charter 
subject  to  appeal  to  the  next  Convention.^  ' 

The  rule  has  been  invoked  in  two  classes  of  cases.  In  the  first 
place,  city  federations  have  been  required  to  exclude  local  unions 
which  have  been  suspended  by,  or  have  seceded  from,  or  are  merely 

iProm  18S8  to  I8Q3  the  rule  required  city  federations  to  exclude  local  unions 
of  national  unions  not  affiliated  with  the  Federation,  but  since  1803  city  federa- 

unTons  u^Vh''"  PTl"'^''  '^"*'  '^'  ^"^^^  ""^^"^  «^  unaffiliated  national 
unons  which  are  not  hostile  to  national  unions  affiliated  with  the  Federation 

Until   IQ02   a  oty  federation   which  disobeyed    the   rule   was   deprived   of 
representation.    Since  then  the   charter  has   been    withdrawn    (Proceed  ngs   o 
the  American  Federation  of  Labor,  1902,  p   216)  roceeamgs   ol 

Sectiorf''"'"'"    '^   '^'   "^""'""^^    Federation    of    Labor,    1912,    Article    XI, 


51 


THE  NATIONAL  UNION  397 

not  attached  to,  the  national  union  of  their  trade   if  the  national  j 
union  is  affiliated  with  the  Federation.    In  1891    for  instance,  the 
San  Francisco  Trades  and  Labor  Assembly,  a  c.ty  federation,  wa 
suspended  from  further  representation  in  the  Federation  because  1 
refused  to  exclude  a  local  union  which  had  been  suspended  by    he 
Brewery  Workers.'     The  Federation  has  consistently  required  the 
city  federations  to  maintain  the  principle  that  every  local  unu,n 
should,  if  possible,  be  connected  with  a  national  >>";7; /^^^  "^^ 
federations,  governed  largely  by  local  considerations,  if  left  to  them- 
selves would  frequently  have  offered  aid  and  comfort  to  seceding  and 
independent  unions,  and  to  that  extent  have  contributed  to  the 
support  of  local  as  against  national  unionism.  , 

In  the  second  place,  city  federations  have  been  required  to  exclude 
local  unions  affiliated  with  a  national  union  which  is  not  connected 
with  the  Federation  and  which  aims  to  include  m  its  membership 
classes  of  workmen  which  are  recognized  by  the  Federation  as  prop- 
erly belonging  to  a  national  union  so  affiliated.   In  violation  of  the 
rule  city  federations  have  not  infrequently  admitted  such  local  unions 
and  refused  to  unseat  their  delegates  when  ordered  to  do  so.    From 
time  to  time  charters  of  city  federations  have  been  revoked  in  par- 
ticularly offensive  cases  and  new  federations  formed  from  the  loca 
unions.   There  has  been  increasing  strictness  in  the  enforcenient  of 
the  rule    In  1908  a  large  number  of  city  federations  admitted  the 
local  unions  of  a  national  union  of  electrical  w^orkers    although 
another  national  union  in  the  same  trade  was  affiliated  with  the 
Federation.   Other  city  federations  admitted  local  unions  of  the  Flmt 
Glass  Workers,  who  at  that  time  were  engaged  in  a  bitter  junsdic^ 
tional  dispute  with  the  Glass  Bottle  Blowers,  a  union  affiliated  with 
the  American  Federation  of  Labor.   These  city  federations  persisted 
in  their  course  after  notice  and  were  deprived  of  their  charters  by  the 
executive  council  of  the  Federation.   On  appeal  to  the  convention 

the  council  was  sustained.  .     •  ,    .u  *  ^„i„ 

The  national  unions  regard  it  as  a  well-settled  principle  that  only 
one  national  union  may  have  jurisdiction  over  a  particular  class  of 
workmen.  They  have  found  that  the  support  of  city  federations  has 
been  one  of  the  chief  factors  in  promoting  and  encouraging  the  forma- 
tion of  rival  national  unions,  and  they  have  become  more  and  more 
I  Proceedings  of  the  American  Federation  of  Labor,  1890,  p.  39. 


f  I 
)  f 


I 


398       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

determined  that  the  city  federation  shall  not  lend  its  aid  to  such 
rebellions. 

The  right  of  a  city  federation  to  exclude  a  local  union  of  a  national 
union  affiliated  with  the  Federation  has  also  been  restricted.  As  early 
as  1897  the  executive  council  of  the  Federation  decided  that  it  was 
improper  for  a  city  federation  to  expel  a  local  union  merely  because 
its  national  union  was  involved  in  a  controversy  with  another  na- 
tional union.^  In  1901  the  Chicago  Federation  of  Labor  was  ordered 
to  readmit  the  delegates  of  an  expelled  local  union.-  These  decisions 
were  not  based  on  any  specific  clause  in  the  constitution,  but  in  1902 
a  section  was  added  which  provided  that  a  city  federation  might  not 
reject  the  credentials  of  the  delegates  from  a  local  union  of  a  na- 
tional union  affiliated  with  the  American  Federation  except  on  charges 
duly  proved.  The  delegate  or  local  union  concerned  was  given  a 
right  of  appeal  to  the  executive  council  of  the  Federation.^  This 
right  has  been  freely  used,  and  in  1908,  when  certain  city  federations, 
on  account  of  a  jurisdictional  dispute  between  the  Plumbers  and 
the  Steam  Fitters,  refused  to  admit  delegates  from  Steam  Fitters' 
local  unions,  the  convention  of  the  Federation  ordered  the  executive 
council  to  issue  a  general  order  to  all  city  federations  that  they  must 
admit  the  delegates  of  local  unions  of  Steam  Fitters.'* 

The  national  unions  have  not  been  content  merely  to  secure  that 
their  interests  are  safeguarded  in  the  composition  of  the  city  feder- 
ation. They  have  also  gradually  evolved  a  code  of  rules  to  be  fol- 
lowed by  the  city  federations  in  the  conduct  of  their  affairs.  These 
rules  relate  to  the  boycott,  to  assessments  for  strikes,  and  to  interfer- 
ence in  collective  bargaining — fundamentally  important  activities  of 
the  city  federation."^ 

The  initiation  and  support  of  boycotts  has  always  beeii^one  of  the 
chief  functions  of  the  city  federation.  Comprising  representatIves~of 
unions  of  all  trades,  the  power  of  the  city  federation  as  a  boycot- 
ting instrument  has  been  very  great.  Desirous  of  turning  this  power 
to  their  service,  the  national  unions  have  yet  found  difficulty  in 

1  Proceedings  of  the  American  Federation  of  Labor,  1897,  P-  35- 

-Id.  1901,  p.  158. 

3/rf.  1902,  p.  215;  1904,  p.  243. 

*ld.  1908,  p.  192. 

«See  Burke,  History  and  Functions  of  Central  Labor  Unions,  p.  80. 


THE  NATIONAL  UNION 


399 


trnllin.  it  since  city  federations  have  not  infrequently  initiated 
controlling  It,  since  ciiy  ^^^^  ^^^.^^^^  ^^^^^^ 

boycotts  which  r ^;^;^!^^^^^^^       in  the  constitution  of  the  Amer- 
^^S::^^^^         city  federations  to  orginate  boy 
c:us?nd  requiring  them  before  ^^^^^^^^^ 
unions  to  investigate  the  matter  and  ^^  ;^^ct /.^  ^^'^^^^  ^^,^  ^^.^ed, 

settlement.^    On  several  occasions  ^^^^l^^^^^^^^  ..an^ 

on  complaint  of  national  unions  to  c«^  J^^^^^  ^^ 

recommended  that  only  boycotts  on  firms  domg  an  mterstate  busi 
Lrshould  be  submitted  to  tbe  na^iona    ~  ^^^^^^^^^ 

'thetsrssmer  o^  S  ^Sns  by  city  federations  for  the  support 
of  Itr Sas  been  the  occasion  of  frequent  complaint  by  the  national 
fl^    The  stronger  national  unions  finance  their,  own  strikes,  and 
Tv  sJngy  obS  to  having  their  members  required  to  supper 
tlSnii  loLl  unions  -.e-^  unions  are  u„w..ng^  .  | 

'"T'n  occasions    wh  n  Lai   interests  are   much   involved,   some 

"  hn,nd  be  kft  to  city  federations  to  raise  funds.   At  the  session 

'f Th   te  tan  F^    aUo"  of  Labor  in  1904  Mr.  Mac.rthur,  a  dele- 

!irofrs:::ei-s..ionp.^^^^^^^^^ 

i^r  Cc^nX ^s^tS  ;:  forbid  all  assessments,  but 

,  Proceedings  of  the  American  ^^^"^'^uVoTl' IT  "'  '''" 
^Id.  1903)  P-  182. 


ai^.*ii 


I 


H 


400       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

did  advise  tlie  city  federations  that  assessments  should  only  be  levied 
after  the  question  had  been  submitted  to  the  membership  of  the 
affiliated  unions.' 

Finally,  the  national  unions  have  strongly  resented  the  uninvited 
interference  of  city  federations  in  the  negotiations  between  local 
unions  and  employers.    National  unions  are  not  infrequently  glad 
to  avail  themselves  of  the  aid  of  the  city  federation  in  dealing  with 
employers  but  the  stronger  national  unions  object  to  any  attempt  on 
the  part  of  the  city  federations  to  take  the  lead  in  such  matters.    In 
1898  a  section  was  added  to  the  constitution  of  the  Federation  which 
provided  that  a  city  federation  should  not  have  authority  to  order  a 
strike  of  any  local  union  without  the  consent  of  the  national  union  = 
In  1906  an  additional  section  provided  that  a  city  federation  must 
take  no  part  in  "the  adjustment  of  wage  contracts,  wage  disputes  or 
working  rules  of  local  unions  affiliated  with  a  National  or  Interna- 
tional union  "  unless  the  rules  of  the  national  union  permit  or  unless 
consent  is  given  by  the  officials  of  the  national  union  ' 

h}'Z  "!f  r°'T^^  f"'"'^  "  "'"'  ^'  '''"  '^^'  the  city  federation 
has  been  definitely  subordinated  to  the  national  union.    From  the 
standpoint  of  the  stronger  national  unions  the  city  federations  are 
merely  the  means  of  making  more  effective  the  boycott,  of  cariyinE 
on  the  propaganda  for  the  union  label,  and  of  taking  such  polifical 
action  as  the  needs  of  the  labor  movement  may  require   The  les 
centralized  national  unions  would  be  willing  to  make  the  city  iedZ 
ations  more  important.    Particularly  is  this  true  of  many  of  the 
unions  in  the  building  trades.    There  is,  therefore,  occasionally  some 
division  of  opinion  among  the  national  unions  in  the  Federation  Til 
the  proper  functions  of  the  city  federations,  but  every  increase    n 
the  centralization  of  the  national  union  has  contributldTrsen  " 
ment  m  favor  of  the  subordination  of  the  city  federation 


y 


IV 


-€it^ 


tra^'  L"o?re!r  "•  °^=^^"''^^':°"'  '^e  federation  of  unions  of  allied 
trades,  is  of  recent  origin.  Local  councils  were  formed  in  the~binidi^e 
trades  as  early  as  1865  and  in  the  printing  trades  in  1886     Coundls 


THE  NATIONAL  UNION 


401 


have  also  been  formed  in  the  metal  trades,  among  the  railroad  unions, 
and  among  the  maritime  trades.'  It  will  be  sufficient  for  our  present 
purpose  to  describe  the  development  which  has  taken  place  in  the 
relation  of  the  national  unions  of  the  building  trades  to  the  local  and 
national  building  trades  councils,  since  in  these  trades  the  activities 
of  the  councils  have  been  preeminently  of  such  a  kind  as  to  cause  the 
national  unions  concern. 

The  local  building  trades  councils  have  been  an  important  factor 
in  industrial  disputes.   They  have  systematically  employed  the  sym- 
pathetic strike  and  have  ordinarily  maintained  jointly  the  closed 
shop.     For  many  years  their  activities  were  unsupervised  by  any 
national  authority.    In  1897  a  considerable  number  of  local  building 
trades  councils  formed  a  national  organization  known  as  the  Inter- 
national Building  Trades  Council.  In  1903  it  comprised  seven  national 
unions  and  seventy-six  building  trades  councils.    The  affiliated  na- 
tional unions  were,  for  the  most  part,  small  unions,  since  the  larger 
unions  were  from  the  outset  strongly  opposed  to  the  International 
Building  Trades  Council.    In  the  annual  convention  of  that  body 
each  local  council  originally  was  entitled  to  one  vote  for  each  trade 
in  the  council.     A  single  local  council  might,  therefore,  cast  ten 
or  fifteen  votes,  but  a  national  union  was  allowed  only  a  single 
vote.    In   1904  and   1905  changes  were  made  in  the  constitution 
with  a  view  to  giving  the  national  unions  greater  weight  in  the 
conventions,  but  the  national  unions  were  far  from  satisfied.    In 
1903  a  few  of  the  larger  national  unions  in  the  building  trade§,.x>r- 
ganized  the  Structural  Building  Trades  Alliance.    The  convention  of 
the  Alliance  was  composed  exclusively  of  delegates  from  national 
unions.    The  organization  of  the  Alliance  greatly  weakened  the  Inter- 
national Council,  and  for  some  years  the  latter  has  been  unimportant. 
The  Structural  Building  Trades  Alliance  was  transformed  in  ^908 
into  the  Building  Trades  Department  of^  the  American  Federation  of 

Labor. 

The  annual  convention  of  the  Building  Trades  Department,  the 
final  authority  in  its  system  of  government,  is  composed  of  delegates 
fromlEeliffiliated  national  unions.  Attempts  have  been  made  from 
time  to  time  to  secure  the  admission  of  delegates  from  the  local 
councils,  but  these  attempts  have  always  failed.  In  1909  delegates 
1  Kirk,  National  Labor  Federations  in  the  United  States,  pp.  80-88. 


i 


w^ 


402       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

from  certain  councils  were  allowed  the  privilege  of  participating  in 
the  discussion  but  not  the  right  to  vote.  In  1910  the  convention  re- 
fused to  admit  delegates  from  local  councils/ 

The  Building  Trades  Department  has  not  been  very  successful 
as  yet  in  bringing  the  local  councils  under  control,  but  a  brief  survey 
of  its  efforts  will  indicate  the  points  at  which  the  national  unions  de- 
sire to  curb  the  activities  of  the  local  councils. 

The  national  unions  have  been  particularly  desirous  of  putting 
an  end  to  the  encouragement  given  to  demarcation  disputes  by  the 
councils.  Until  the  formation  of  the  Department  a  council  waT 
entirely  at  liberty  to  recognize  the  claim  of  either  of  two  contending 
unions  to  a  particular  class  of  work.  They  might,  for  instance,  expel 
the  local  union  of  Stone  Cutters  on  complaint  of  the  Granite  Cutters 
and  thus  lend  their  aid  to  a  particular  adjudication  of  the  question 
of  jurisdiction.  WTien  one  considers  that  there  are  over  two  hundred 
building  trades  councils  in  the  United  States,  and  that  their  decisions 
are  given  in  view  of  local  conditions  and  not  infrequently  are  the 
result  of  coalitions  among  the  various  local  unions  which  have  juris- 
dictional disputes,  the  resulting  confusion  can  be  readily  conceived. 

From  the  time  of  its  organization  the  Department  has  endeavored 
to  establish  the  principle  that  a  local  council  has  no  power  to  de- 
cide a  demarcation  dispute.  In  1909  the  executive  council  of  the 
Department  in  its  report  to  the  convention  said : 

Your  Executive  Council  has  taken  the  position  that  jurisdiction 
lines  are  laid  down  by  International  organizations,  and  as  such  they 
can  only  be  altered,  amended,  or  waived  by  duly  accredited  repre- 
sentatives appointed  by  each  International  union  acting  in  a  general 
way,  and  thereafter  such  amendments,  changes,  or  conditions  must 
be  ratified  by  the  Executive  Committees  of  the  Internationals  in 
interest.^ 

At  the  session  of  the  Department  in  1908,  when  the  old  controversy 
of  the  Plumbers  and  the  Steam  Fitters  came  up,  Mr.  Duffy,  secretary 
of  the  United  Brotherhood  of  Carpenters  and  Joiners  and  a  delegate 
from  that  union  to  the  convention  of  the  Department,  said : 

I  believe  every  organization  represented  here  has  had  men  involved 
in  strikes  with  Plumbers  on  one  side  and  Steam  Fitters  on  the  other. 
Now  we  are  coming  down  flat-footed  to  tell  you  that  the  Central 

'Proceedings  of  the  Building  Trades  Department,  1910,  p.  96. 
^Id.  1909,  p.  36. 


r| 


THE  NATIONAL  UNION 


403 


Bodies  and  the  local  unions  affiliated  with  them  must  not  take  any 
part  in  the  future  in  these  fights  that  may  arise  over  jurisdiction. 
...  We  not  only  say  must,  but  you  are  ordered  by  this  convention 
to  come  together.^ 

On  numerous  occasions  the  executive  council  of  the  Department 
has  forced  local  councils  to  readmit  local  unions  of  affiliated  national 
unions  which  had  been  expelled  on  account  of  demarcation  disputes.-^ 
Before  the  establishment  of  the  Department  local  councils  fre- 
quently admitted  to  membership  local  unions  which  were  independent 
of  any  national  union  and  local  unions  affiliated  with  national  unions 
which  were  rivals  of  recognized  national  unions.    Countenance  and 
encouragement  were  thus  given  to  the  formation  of  independent  and 
"dual"  organizations.   In  the  building  trades,  because  of  the  local 
character  of  the  industry,  such  independent  and  ^^dual"  unions  have 
been  easily  formed  and  in  some  cases  have  flourished  for  many  years. 
The  executive  council  of  the  Department  decided  in  1908  that  local 
councils  might  admit  to  membership  local  unions  of  national  unions 
not  affiliated  with  the  Department,  but  only  if  the  "  claims  of  juris- 
diction in  no  way  conflicted  with  the  locals  of  any  affiliated  union," 
and  this  decision  was  affirmed  by  the  convention.^  In    1909   the 
Newark  Building  Trades  Council  was  forced  to  unseat  the  delegates 
of  "dual"  unions  of  Tile  Layers  and  Hod  Carriers.   In  the  same 
year  the  president  of  the  Department  reported  that  the  number  of 
independent  unions  of  Hod  Carriers  was  so  large  that  the  national 
union  should  be  reorganized  under  the  auspices  of  the  Department, 
and  this  was  finally  accomplished  in  1910.*    A  year  later  local  coun- 
cils were  ordered  to  unseat  delegates  of  the  "dual"  local  unions  of 

Electrical  Workers.^ 

The  national  unions  in  the  building  trades  have  not  attempted  to 
bring  the  local  councils  under  control  to  any  considerable  extent  ex- 
cept^'with  reference  to  the  admission  and  exclusion  of  local  unions. 
It  was  provided  in  1899  that  local  unions  when  making  a  demand 
for  an  increase  of  wages  or  a  reduction  of  hours  must  secure  the 
approval  of  their  national  unions  as  well  as  of  the  council.  But  the 
constitution  of  the  Department  from  the  outset  has  set  forth  that 

1  Proceedings  of  the  Building  Trades  Department,  1908,  p.  68. 

^Ibid.  pp.  9,  16.  ^Id.  1909,  pp.  65-70;  1910,  pp.  30-32. 

a  Id.  1908,  p.  35;  1909,  P-  124.      ^'id.  1910,  p.  90. 


n 


I 


I 

m 


tii 


404       TRADE  UNIONISM  ANt)  LABOR  PROBLEMS 

no  local  union  affiliated  with  a  council  may  strike  without  the  consent 
of  the  council.  Moreover,  not  only  have  the  national  unions  been 
content  to  permit  the  local  councils  to  order  sympathetic  strikes,  but 
in  order  to  facilitate  such  strikes  provision  has  been  made  since  1909 
in  the  constitution  of  the  Department  that  local  unions  must  not 
enter  into  agreements  which  will  prevent  their  "giving  each  other 
prompt  and  effective  assistance  or  their  combining  for  united  action 
and  material  support."  ^  Where  councils  have  ordered  local  unions 
to  strike  and  expelled  them  for  failure  to  do  so,  the  Department  has 
refused  to  require  their  reinstatement."  The  willingness  of  the  na- 
tional unions  in  the  building  trades  to  allow  local  councils  to  order 
out  the  members  of  local  unions  on  strike  is  explicable  by  the  fact 
that  the  trade-unions  in  the  building  trades  are  far  less  centralized 
than  in  most  other  trades. 

The  Department  has  not  been  able  as  yet  to  enforce  effectively 
even  those  of  its  rules  relating  to  jurisdictional  disputes  and  inde- 
pendent unions.  The  control  of  the  councils  by  the  Department  is 
accomplished,  to  the  extent  that  it  is  accomplished,  by  pressure  on 
the  local  unions  exerted  through  the  national  unions  with  which  they 
are  affiliated.  If  a  local  council  refuses  to  obey  the  rules  of  the 
Department  and  its  charter  is  revoked,  a  part  or  all  of  the  local  unions 
may  form  an  independent  council.  The  national  unions  cannot  be 
uniformly  depended  upon  in  such  cases  to  prevent  their  local  unions 
from  joining  such  independent  councils.  The  officers  of  the  Depart- 
ment have  proceeded  with  great  caution  in  enforcing  the  rules  in 
order  to  avoid,  as  far  as  possible,  the  formation  of  "dual"  councils. 
In  his  report  to  the  convention  of  the  Building  Trades  Department 
in   1911   President  Short  said: 

In  the  case  of  local  councils  who  saw  fit  to  disobey  the  mandates'^ 
of  the  St.  Louis  Convention,  they  were  refused  any  further  recogni- 
tion by  the  Department  in  so  far  as  information  or  the  obtaining 
of  supplies  etc.  was  concerned,  and  charters  in  various  centers 
would  have  been  revoked  had  it  not  been  for  the  fact  that  it  would 

^Proceedings  of  the  Building  Trades  Department,  1909,  p.  64. 

^Ibid.  p.  38. 

3 The  "mandates"  here  referred  to  were  the  decisions  by  the  convention 
of  191 1  that  local  councils  should  expel  the  delegates  of  local  unions  of 
Carpenters  and  Steam  Fitters,  since  these  national  unions  had  refused  to  accept 
the  rulings  of  the  Department  with  reference  to  their  jurisdictional  claims. 


THE  NATIONAL  UNION 


405 


have  worked  serious  injury  to  innocent  parties,  by  that  I  mean  or- 
ganizations who  were  loyal  to  the  Department.  It  would  have  been 
necessary,  had  charters  been  revoked,  to  immediately  proceed  to 
organize  new  councils,  with  the  absolute  certainty  that  some  of  the 
organizations  would  have  continued  in  the  old  council,  thus  dividing 
the  strength  of  the  Building  Mechanics  in  such  centers  as  new  councils 
were  instituted ;  as  witnessed  in  the  case  of  the  St.  Louis  Building 
Trades,  where  we  have  organized  a  new  council  under  the  laws  ot 
the  Department  and  there  still  remains  a  portion  of  the  old  council 
who  refuse  to  obey  the  laws  of  the  Department.' 

Obviously  the  control  exercised  by  the  Department  over  the  local 
councils  can  never  be  effective  until  the  national  unions  are  willing 
and  able  to  force  their  local  unions  to  refrain  from  opposing  the 
councils  established  by  the  Department.  This  result  is  not  likely  to 
be  accomplished  in  the  near  future.  In  the  first  place,  the  national 
unions  in  the  building  trades  have  relatively  decentralized  govern- 
ments and  correspondingly  small  power  over  their  local  unions. 
Secondly,  the  national  unions  are  not  infrequently  reluctant  to  abide 
by  particular  rules  of  the  Department,  although  they  favor  the 
exercise  of  power  in  that  field  by  the  Department. 

In  the  period  since  1897,  then,  the  national  union  has  retained  and 
made  more  secure  its  control  of  the  national  federation;  it  has 
limited  in  important  respects  the  powers  of  the  city  federations; 
and  finally,  it  has  taken  the  first  tentative  steps  in  the  control  of 
the  allied-trades  councils.  In  no  other  period  of  American  trade- 
union  history  has  the  dominance  of  one  of  the  forms  of  trade-union 
grouping  been  so  clearly  the  ruling  principle  in  the  structure  of  Amer- 
ican labor  organization.  The  complete  subordination  of  the  city 
federations  and  of  the  allied-trades  councils  is  probable,  since  the 
increasing  centralization  of  the  larger  and  more  powerful  national 
unions  leads  them  more  and  more  to  oppose  any   interference  by 

local  organizations. 

George  E.  Barnett 

Johns  Hopkins  University 


r 


H 


h  I 


I 


1  Proceedings  of  the  Building  Trades  Department,  1911,  P-  36. 


i^ 


XXVIII 

THE    NATIONAL    FOUNDERS^    ASSOCIATION^ 

EMPLOYERS'  associations  in  the  United  States  formed  for  the 
purpose  of  dealing  with  or  opposing  organized  bodies  of  work- 
men are  of  comparatively  recent  origin,  but  in  the  last  fifteen  years 
they  have  become  a  factor  in  industrial  relations  which  is  not  to  be 
ignored.  Each  December  the  Stove  Founders'  National  Defense 
Association  and  the  Iron  Molders'  Union  hold  a  conference  at  which 
are  determined  wages  and  conditions  of  employment  in  the  stove 
foundries  for  the  succeeding  year;  the  glass  manufacturers  meet 
representatives  of  the  several  glassworkers'  unions  annually;  the 
coal  operators  in  the  Southern  and  Southwestern  coal  fields  have  a 
series  of  written  agreements  with  the  United  Mine  Workers  of 
America.  In  these  and  several  other  industries  which  might  be  men- 
tioned the  system  of  collective  bargaining  developed  between  the 
manufacturers  and  their  men  has  resulted  in  the  maintenance  of  a 
permanent  industrial  peace. 

j  On  the  other  hand,  a  number  of  organizations  of  employers  exist 
almost  exclusively  for  the  purpose  of  resisting  collective  bargaining 
and  recognition  of  the  unions,  on  the  theory  that  where  the  complete 
autocracy  of  the  employer  is  preserved  the  interests  of  all  are  better 
cared  for  than  under  any  scheme  of  industrial  democracy  yet  devised. 
Nor  has  this  conclusion  been  reached  by  purely  deductive  reasoning 
on  the  part  of  those  who  take  this  position.  One  of  the  most  signifi- 
cant features  of  their  program  is  that  it  is  based  upon  a  wealth  of 
experknce,  for  of  the  employers'  associations  active  m~opposing  the 
advance  of  the  unions  some  of  the  most  important  are  those  which 
have  attempted  to  operate  under  agreements  with  organizations  of 
their  men  and  after  affording  the  system  a  trial  have  found  it  un- 
suited  to  their  needs  and  unadaptable  to  their  industries.  This  is 
true  of  the  National  Metal  Trades  Association,  which  now  refuses  to 

^From  Quarterly  Journal  of  Economics,  Vol.  XXX  (1916),  pp.  352-386. 

406 


NATIONAL  FOUNDERS'  ASSOCIATION  407 

deal  with  the  Machinists'  Union ;  of  the  National  Erectors'  Associa- 
tion which  will  no  longer  countenance  the  International  Association 
of  Bridge  and  Structural  Iron  Workers  ;  of  the  National  Founders' 
Association  as  regards  the  Iron  Molders'  Union.  In  addition,  the 
influence  of  these  failures  has  spread  to  nontrade  organizations  of 
employers  such  as  the  Anti-Boycott  Association,  the  National  Asso- 
ciation of  Manufacturers,  and  the  Citizens'  Alliances,  which  have  in- 
corporated in  their  policies  a  definite  defense  against  union  aggressions 

of  every  kind. 

The  oldest  and  in  some  ways  the  most  interesting  of  these  now 
hostile  traHe"  organizations  of  employers  ijjlifijiationaljounde^^ 
Association,  whose  membership  comprises  nearly  five  hundred  manu- 
fiSurerTof  cast-iron  specialties  in  the  United  States  and  Canada, 
employing  approximately  one  eighth  of  all  the  molders  and  core- 
makers  in  the  country  and  producing  a  considerable  proportion  of 
the  output  of  heavy  machinery  and  lighter  iron  castings.    The  story 
of  this  organization's  struggle  with  the  Iron  Molders'  Union  must 
always  be  an  important  chapter  in  the  history  of  the  American  labor 
movement.    Formed  ini  898  jorJhe_distinct.J)urpose  oJ^^ibstiiixUn.g 
for  the  prevailing  ind^St?I5rS?3ri"policy  of  cooperation  with  the 
U^ter'lST^d  been  so  successfully  done  by  the  employers  in  the 
st^branch  of  the  foundry  trade,  the  National  Founders'  Asso- 
ciation the  next  year  entered  with  enthusiasm  into  an  agreement  with 
the  Union  to  arbitrate^  disputes  and  thus  do  away  with  strikes  and 
the  other  annoyances  characteristic  of  a  union-dominated  industry. 
But  as  the  months  went  by,  this  instrument  designed  for  peace  seemed  | 
to  bring  only  an  increase  of  trouble.    Misunderstandings  as  to  its 
purpose  and  the  method  of  its  operation,  combined  with  actual  if  not 
especially  glaring  violations  of  its  terms  on  the  part  of  both  orgam- 
zations,  soon  served  to  bring  about  great  dissatisfaction.    Yet  for 
nearly  six  years  the  prescribed  form  of  negotiations  was  gone  through, 

and  an  honest  effort  was  made  by  Association  and  Union  to  reach  a 

iThe  word  "arbitration"  as  applied  to  the  settling  of  labor  disputes  was 
originally  used  to  designate  all  forms  of  conferences  between  employers  and 
employees.  In  the  case  of  the  Iron  Molders'  agreements  with  both  the  Stove 
Founders'  National  Defense  Association  and  the  National  Founders'  Association 
the  system  required  pure  conciliation,  the  board  being  composed  of  an  equai 
number  from  each  side  with  no  provision  whatever  for  real  arbitration  mvolv- 
ing  the  calling  in  of  an  odd  mau. 


n 


r  » n 


'~^H 


id 


408       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

mutually  acceptable  method  of  procedure.  When  at  last  it  became 
clear  that  there  was  no  ground  on  which  both  could  meet,  the  Asso- 
ciation abrogated  the  agreement  and  attempts  at  collective  bargaining 
were  abandoned. 

It  was  perhaps  unfortunate  that  relations  with  the  Union  were 
undertaken  by  the  National  Founders'  Association  before  its  funda- 
mental law  and  administrative  machinery  were  fully  competent  to 
handle  the  problems  this  relationship  entailed,  but  in  developing 
the  technic  as  well  as  the  policy  of  the  Association  to  its  present  high 
standard  of  efficiency  the  experience  with  the  Union  played  an  im- 
portant part.  As  will  appear  in  the  following  pages,  it  was  not  until 
1904  and  the  abrogation  of  the  agreement  that  the  policy  of  the 
Association  was  firmly  established  and  the  governmental,  financial, 
and  defense  systems  completely  worked  out.  Since  that  time  no 
change  worth  mentioning  has  been  made  in  either  structure  or 
method,  and  the  Association  today  is  practically  what  its  intercourse 
with  the  Iron  Molders'  Union  has  made  it.  It  is  the  purpose  of  the 
present  paper  to  describe  its  structural  evolution,  but  in  presenting 
the  facts  as  to  the  development  of  its  procedural  mechanism  no 
attempt  has  been  made  to  pass  judgment  upon  the  justice  of  the 
position  it  has  assumed  or  the  principles  for  which  it  stands. 

The  objects  of  the  National  Founders'  Association  as  stated  in  the 
constitution  are 

ist — The  adoption  of  a  uniform  basis  for  just  and  equitable  deal- 
\  ings  between  the  members  and  their  employees  whereby  the  interests 
^    of  both  will  be  properly  protected. 

2d — The  investigation  and  adjustment  by  proper  officers  of  the  As- 
sociation, of  questions  arising  between  members  and  their  employees. 

This  purpose  has  never  changed  in  the  seventeen  years  of  the  As- 
sociation's existence,  but  the  means  by  which  it  is  to  be  accomplished 
have  altered  considerably. 

At  first  there  was  no  definitely  expressed  policy  beyond  a  deter- 
mination to  band  together  the  foundr>'men  of  the  country  for  the 
purpose  of  ridding  themselves  of  many  of  the  working  conditions 
which  long  years  of  effective  unionism  had  established  in  their  shops 
and  of  preventing  further  encroachments  from  that  source.  In  place 
of  union  rules  as  the  controlling  force  in  fixing  shop  conditions, 
it  was  desired  to  establish  those  ''general  principles  of  freedom  to 


L 


NATIONAL  FOUNDERS'  ASSOCIATION  409 

employers  in  the  management  of  their  --^^^V-^f"";'""  ^  tan 
thl  British  manufacturers  in  the  industry  had  just  o^tamed  m  an 
llement  with  their  men.  Nothing  in  this,  however  implied  any 
ntent  to  crlsh  the  Union.  Indeed,  there  was  no  hostility  on  the  em- 
ployers par^^^^^^^^^  to  thosepractices  whichitwasbelievedhadprov^d 
detrimental  to  their  employees  as  well  as  themselves.  Could  these 
t™  aled  and  the  good  which  was  known  *«  inh- ^  ^^mfn 
action  be  molded  to  the  employers'  ends,  it  was  thought  the  workmen 
and  the  industry  would  both  benefit.^  .  ^    »i,»  =;tm,P 

The  model  of' procedure  first  followed  was  that  used  by  the  Stove 
Founded  National  Defense  Association,  whose  constitution  was  in 
manvprrts  copied  almost  verbatim  and  whose  policy  of  agreemen 
Th  the  Union  served  as  the  inspiration  for  the  newer  organuation 
r tempt  to  reach  a  satisfactory  system  of  collective  bargaining.    Bu 
tiesTwe  e  no  sooner  tried  than  they  proved  in  some  rather  ser.ou 
wa!-    To  be  unsuitable.   The  constitutional  misfits  were  remedied  as 
The  need  became  apparent ;  the  difficulties  with  the  Umon  were  much 
more    undamental":   It  was  soon  discovered  that  the  freedom^  from 
Xr  troubles  which  the  Stove  Founders  had  secured  through  th«r 
ateement  had  been  purchased  at  the  price  of  surrendering  a  con- 
siderate share  of  the  control  of  the  industry,  that  instead  of  shaking 
off  ur^on  rules  and  a  never-before-recognized  participation  in  shop 
mana^ementagreement  had  come  to  mean  in  the  stove  foundries 
kgitimatized  copartnership  of  authority  and  administration. 

S  a  system  the  National  Founders'  Association  had  never  con- 
temlted  nor  were  its  leaders  convinced  that  conciliation  necessardy 
TpS  such  a  yielding  to  the  Union  as  the  stove  -"  ^ad  gra  td 
with  what  they  considered  to  be  so  little  given  m  return.  During  the 
vears  of  bargaining  which  followed  there  was  evident  on  the  part  of 
Sssociatron  a  wmingness  to  make  certain  concessions  to  the  Union 

1898;  William  H.  P'/*^'"'  "nfermce  between  the  National  Founders'  Asso- 
^^^''  ""rtre  i';^  Mo.der?S  of  ™  .Xmerica,  New  York  March  8. 
ciation  and  the  Iron  ^I°'d"^ J^^  j     ^^^   ^^ti^^^i    Founders'    Association, 

iSoQ     MS.),   pp.    5-6.    ^"^       .'  =^,.    '  „  p,,u  Au.'usto   1899,  pp.  41,  45 ;  id- 
Buffalo,  February  .,  1899,  P-  4;  'f„N.aga--a  ^f '  ^u.ust^,    899,  PP  ^^^^.^^^^ 

New  VorU  Nov     b„  .3,  ,9°;  Cmb^ril'i  t  t  Z  R^ie.,  December, 
',;;rpp.  718! '36tNat"ri  Founders'  Association  Confidential  Circular  No.  6. 


.1 


ill 


410       TR.\DE  UNIONISM  AND  LABOR  PROBLEMS 

if  its  members  were  to  receive  commensurate  benefits.  But  all  at- 
tempts to  reach  a  mutually  acceptable  set  of  working  rules  were 
balked  by  the  Union's  inability  to  give  up  or  modify  any  part  of 
its  fundamental  law.  This  attitude  on  the  part  of  the  Union  may 
not  have  been  without  some  justification,  but  the  fact  remains  that 
the  original  plasticity  of  the  Association's  policy  gave  way  gradually 
to  a  rigidity  which  made  it  as  unarbitrable  and  unsusceptible  of  com- 
promise as  that  of  the  Union,  and  whereas  in  1900  the  cardinal  prin- 
ciples according  to  which  the  Association  desired  to  operate  were 
presented  mainly  as  a  suggestion  of  certain  features  to  be  embodied 
in  an  agreement,  since  1904  they  have  served  as  an  ultimatum 
whenever  Association  and  Union  have  come  in  conflict. 

Briefly  summarized,  the  Association's  oiitUne  of  policy  declares 
against  union  restriction  of  output,  union  limitatibn'oflhe' earning 
capacity  of  the  employee,  union  limitation  on  the  employment  of 
apprentices,  union  impositio'iToI  fines  and  restrictions  upon  work- 
"^^"-  It  is  in  favor  of  a  fair  day's  pay  for  a  fair  day's  work^  the  right 
of  the  employer  to  hire  whomsoever  he  sees  fit  without  regard  lo 
union  affiliation,  the  op'eration  of  molding-machines  and  approved 
appliances  without  restriction,  the  education  of  the  American  boy 
in  the  trade  of  molding  without  union  interference.  Instead  of  repre- 
senting its  members  in  a  collective  capacity  to  negotiate  with  their 
men  for  the  terms  of  employment,  the  Association  has  become  in 
reality  a  mutual  insurance  organization  whose  members  are  protected 
against  the  excessive  demands  of  the  Union  and  receive  aid  in 
upholding  in  their  shops  the  principles  for  which  the  Association 
stands. 

Although  the  original  law  of  the  Association,  combined  with  the 
almost  immediate  ratification  of  the  agreement  with  the  Union,  made 
ample  provision  for  the  elimination  of  cessations  in  the  industry 
through  the  use  of  conciliation  in  the  settlement  of  disputes,  the 
Association  was  so  organized  that  it  could  fight  if  occasion  required, 
and,  in  spite  of  all  efforts  to  maintain  peace,  recourse  to  active  de- 
fense measures  was  frequently  thought  to  be  necessary.  When  rela- 
tions with  the  Union  were  broken  off  entirely,  although  the  Association 
continued  to  indorse  the  principle  of  employer  and  employee  getting 
together  to  talk  over  disagreements,  its  protective  work  was  still 
further  developed  and  systematized. 


NATIONAL  FOUNDERS'  ASSOCIATION  41 1 

The  by-laws  have  always  stipulated  that  when  a  member  had  a 
dispute  with  his  employees  which  neither  he  nor  representatives  of 
the  Association  could  settle  and  in  which  the  latter  believed  he  should 
receive  support,  he  might  be  defended  in  one  of  three  ways :  first, 
by  procuring  men  for  him  who  would  take  the  place  of  the  strikers 
second,  by  affording  him  compensation  for  loss  of  production  ;  third, 
by  making  such  work  as  he  might  require.  ,       u  .„ 

In  practice,  securing  molders  to  take  the  place  of  strikers  has  been  , 
the  method  of  defense  most  generally  used.   Very  early  the  plan  was 
devised  of  issuing  to  those  men  who  had  been  faithful  to  their    m- 
ployers  in  time  of  labor  troubles  a  ^^card,"  or  certificate  of  loyalty, 
which  was  to  secure  for  them  the  special  consideration  of  all  members 
and  which  at  the  same  time  made  available  for  the  Association  a 
somewhat  permanent  force  of  strike  breakers.    The  cards  were  ac- 
cepted by  the  men  with  the  understanding  that  they  were  issued  by 
the  Association  and  remained  the  property  of  the  Association,  to  be 
revoked  and  recalled  at  pleasure  upon  evidence  of  breach  of  faith  on 
the  part  of  the  holder.   Whenever  a  man  took  employment  with  an 
Association  member  he  deposited  his  card  with  his  employer  to  be 
returned  to  him  at  the  termination  of  his  contract  if  his  service  had 
been  satisfactory,  or  turned  over  to  the  secretary  of  the  Association 
Nvith  a  statement  of  the  circumstances  for  investigation  in  case  his 
conduct  had  not  been  such  as  befitted  the  bearer  of  such  a  recom- 
mendation.   It  was  not  intended  that  card  men  should  remain  in 
the  foundries  of  members  as  permanent  employees,  but  should  be 
used  simply  to  break  a  strike  and  then  be  moved  on  when  the  trouble 
was  over  and  the  regular  force  returned.    In  the  two  big  strikes  which 
were  handled  with  this  system  of  defense,  75  per  cent  of  the  strik^ 
breakers  used  in  the  second  were  card  men  who  had  been  employed 
in  the  first,^  which  would  seem  to  indicate  that  the  men  were  pleased 
with  the  arrangement  and  that  for  the  Association  it  provided  a 
means  of  getting  molders  much  more  satisfactory  than  the  usually- 
resorted-to  newspaper  advertisements  and  employment  agencies^ 

It  is  not  known  exactly  how  many  of  these  cards  were  issued.    The 

first  were  given  out  during  the  Cleveland  strike  of  1900,  and  in  the 

following  May,  immediately  after  the  settlement  of  that  dispute   1 

was  reported  that  221  were  held  by  men  who  had  worked  for  the 

1  Report  of  the  Secretary,  N.F.  A,  November,  1901  (MS.),  p.  30. 


fifl 


is 


412       TRADE  UNIONISiM  AND  LABOR  PROBLEMS 

Association  at  least  sixty  days.^    By  November,  1902,  the  number 
had  mcreased  to  431.=    Although  the  practice  of  issuing  cards  was 
contmued  for  some  time  longer,  it  is  probable  that  not  many  more 
than  this  were  given  out,  perhaps  500  in  all. 
I     Besides  receiving  the  cards,  the  men  who  were  used  to  break  strikes 
fwere  guaranteed  a  "bonus"  of  at  least  $1  a  day  in  addition  to  the 
t  wages  paid  by  the  individual  employer  in  whose  shop  they  worked 
I  This  bonus  was  paid  from  the  reserve  fund  of  the  Association  as  a 
I  "strike  benefit"  in  recognition  of  the  great   inconvenience,  social 
I  ostracism,  and  perhaps  even  personal  danger  to  which  every  strike 
breaker  is  known  to  be  more  or  less  liable.    Loam  molders  in  Cleve- 
land received  a  bonus  of  $4,  and  it  is  probable  that  some  men  earned 
$7  and  more  a  day  at  that  time.^ 

The  cost  of  this  card-and-bonus  system  was  thought  to  be  on  the 
whole,  less  than  that  of  any  other  method  of  combating  labor  troubles 
In  the  Cleveland  strike,  which  lasted  seven  and  a  half  months  and 
required  the  importation  of  610  men  who  worked  one  day  or  more 
the  total  cost  to  the  Association  was  $142,604.52,  divided  as  follows  : 
Administrative  council     ....  «^  o^ 

o^-  -P-- ::::::  ';;6  :  f 

Procuring  moIdcrs 7  i  c^    -> 

Delivering  molders     .     .                                               '  a'.         " 

^              °.                             ">  1 99-39 

Compensation  to  foundries 3ii7;'>c 

Bonus  to  molders '.'..[  79',7os's3 

Detective  service ^    q 

Miscellaneous  expense '70- 6c 

Expense  of  riot,  September  29,  1900 85404 

Legal  services  .... 

,.  - ,  415.00 

±.xpense  of  boarding  men  out 3  28'>  -^8 

The  cost  of  procuring  and  delivering  molders  alone  was  $21  89  per 
molder.^  In  subsequent  struggles  this  item  was  materially  reduced 
because  of  the  systematic  use  of  card  indexes  and  other  devices  for 
keeping  in  touch  with  the  men  once  found,  which  made  gettin-  strike 
breakers  at  another  time  an  easier  matter  than  had  been  the'assem- 
bling  of  the  group  in  the  first  place.    Thus  the  total  expense  to  the 

1  Report  of  the  Secretary,  N.  F.  A.,  Mav,  looi  (MS)    p    n 
^Proceedings   N^F.  A.,  Detroit,  November  19,  1Q02  (MS.),  p.  20. 
^^  Report  of  the  Secretary,  N.  F.  A.,  xNovember,  1900  (MS) 
*  Id.  May,  1901  (MS.),  pp.  7-9.  ^^* 


1. 


ii 


NATIONAL  FOUNDERS'  ASSOCIATION  413 

Association  of  the  Chicago  strike  of  1901-1902,  which  lasted  thirteen 

months,  was  only  S47,58..33.   Here  440  ™-;\°  T^  J^^^  the 
or  more  were  supplied  at  an  average  cost  of  only  $6.28  P^r  «an  the 
total  saving  per  man  per  day  worked  bemg  117  per  ^«"t  f  "^^  ^f 
of  the  same  item  in  Cleveland  the  year  before.'    In  1903  the  total 
cost  of  supporting  twenty-three  members  whose  853  men  had  gone 

out  was  only  S46,2i&.()i.- 

This  method  of  fighting  strikes  was  fa.rly  satisfactory  so  long  a. 
it  was  expected  the  strike  breakers  would  be  used  only  as  a  temporary 
lever  to  bring  to  terms  Union  members  who  would  eventually  be 
taken  back     But  there  were  several  circumstances  in  connection 
with  the  use  of  the  cards  which  made  them  open  to  abuse,  and,  more- 
over  the  system  left  the  members  of  the  Association  as  dependent 
as  ever  upon  the  Iron  Molders'  Union  for  the  maintenance  of  a 
trained  and  permanent  labor  force.    This  situation  was  recognized  as 
early  as  1901.'    But  it  was  not  until  the  break  with  the  Union  several 
years  later  and  the  establishment  of  a  nonunion  policy  that  't  became 
positively  necessary  to  provide  for  a  member  having  trouble  w.  h 
his  molders  a  crew  of  independent  men  who  would  permanently 
operate  his  foundry.  To  attain  this  end  there  are  now  employed  under 
yearly  contract  a  number  of  mechanics  skilled  in  the  trade  of  molding 
and  coremaking  who  are  placed  in  the  shops  of  members  m  periods 
of  labor  troubles  to  act  as  instructors  in  breaking  in  and  training  new  / 
sets  of  men.   These  operatives  are  in  no  sense  strike  breakers,  fori 
from  the  moment  the  union  men  go  out  the  Union  is  completely/ 
ignored  and  the  Association  is  concerned  not  with  breaking  the  strik^ 
but  with  making  the  most  of  the  opportunity  afforded  by  the  walkou^ 
to  start  up  again  on  an  independent  and  nonunion  basis.   As  rapidly 
as  the  shop  assumes  normal  conditions  the  contract  molders  are 
turned  back  to  the  Association  and  transferred  elsewhere.    By  the 
terms  of  their  contract  they  are  to  go  wherever  they  are  sent,  their 
railroad  fare  is  paid,  and  they  lose  no  time  because  of  the  trave  ing. 
All  men  employed  through  the  Association  to  assist  one  of  its 
members  in  making  his  foundry  independent  of  the  Union  are  en- 
gaged either  under  this  yearly  contract  or  under  one  which  is  very 

1  Proceedings,  N.F.A.,  Detroit,  November  19,  1902  (MS.),  p.  15. 

2  Id  Washington,  November  11,  1903,  P-  "■ 

3 Report  of  the  President,  N.F.A.,  November,  1901  (MS.),  p.  14- 


1 

I 


t\ 


n 


1 


Ili' 


414       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

similar  to  it  but  is  to  run  only  sixty  days.    They  are  guaranteed 
wages  varying  from  S4  to  S5  a  day  for  daywork,  depending  upon 
skill.    In  some  cases  the  men  arrange  with  the  firms  to  which  they 
are  assigned,  to  work  piece  or  premium  plan,  and  earn  in  this  way 
sums  considerably  in  excess  of  the  guaranteed  day  rate.    It  is  said 
that  the  labor  bureaus  run  by  the  Association  have  been  in  oper- 
ation so  long,  and  that  the  Association  is  so  well  and  favorably 
known  among  the  independent  molders  and  coremakers  of  the  country 
because  of  its  fair  dealings,  that  the  bureaus  are  constantly  in  touch 
with  men  seeking  work  and  can  readily  supply  from  time  to  time 
whatever  labor  is  needed  by  the  members.    The  number  of  men  under 
yearly  contract  varies  with  the  industrial  conditions  prevailing.  Their 
contracts  expire  at  different  times  of  the  year,  and  adjustment  of 
supply  to  demand  is  therefore  easy.    When  labor  troubles  have  been 
few,  not  many  will  be  thus  engaged,  but  the  sixty-day-agreement  men 
supplement  the  others  so  nicely  that  practically  any  foundry  can  be 
adequately  manned  on  twenty-four  hours'  notice. 

When  a  member's  support  is  to  consist  of  the  establishment  of  a 
new  labor  force  in  his  foundry,  the  Association  men  are  shipped  to 
him  and  turned  over  to  his  control.  INIen  who  are  to  be  trained  are 
engaged,  being  often  persons  previously  employed  as  laborers  and  at 
unskilled  work  in  the  shop.  Machines  are  installed,  specialized  jobs 
are  planned,  piecework  and  other  schemes  for  encouraging  men  to 
large  output  are  introduced,  and  in  a  short  time  the  foundry  is  in 
full  operation  with  a  new  lot  of  men,  improved  appliances,  and 
freedom  from  union  rules  and  regulations. 

Occasionally  a  condition  may  arise  where  it  becomes  necessary  or 
desirable  for  one  member  to  lend  some  of  his  men  to  another  who  is 
involved  in  a  strike.  This  was  sometimes  done  in  the  days  before 
the  present  large  supply  of  nonunion  men  had  been  made  available, 
but  the  commissioner  reports  that  it  is  a  practice  to  which  recourse 
is  now  seldom  had.  Other  methods  of  defense  provided  for  in  the 
by-laws  are  also  used  but  little,  although  they  may  at  times  supple- 
ment the  customary  method.  To  send  struck  work  out  to  be  made 
has  been  found  very  likely  to  bring  on  sympathetic  strikes  in  the 
foundries  to  which  it  goes.  To  pay  compensation  for  idle  floors  is 
readily  seen  to  be  only  a  last  resort.  Compared  with  the  system  of 
breaking  in  a  crew  of  nonunion  molders  for  permanent  employment 


!: 


NATIONAL  FOUNDERS'  ASSOCIATION  4^5 

these  latter  plans  present  mere  palliatives,  for  until  a  body  ofinde- 
pendent  men  has  been  assembled  and  tramed  m  any  foundry  an 
employer  is  as  much  at  the  mercy  of  the  Un>on  as  ever  and  has  not 
succeeded  in  ridding  himself  of  the  causes  which  were  usually  mstru- 
mental  in  bringing  on  the  trouble  in  the  first  place. 

For  administr3ti.:^.W^0S£u_tbe^SS2c 
tTiHS^TS^^^^c^toT^^  «  a  djstnoxonmutt^e 

o('fi^ri;;^g^^Iec!gjY  the  Associationj^om  names  suggested  by 
thT^JT^SKJiTHi^^SricT^^  is  made  to  make  these 

Is  representative  as  possible  of  the  various  localities  and  foundry  m- 
terests    Each  district  committee  chooses  its  own  chairman  and  vice 
chairman,  who  constitute  with  the  president,  vice  president,  and  trea^ 
urer  of  tke  Association  (unless  as  at  present  the  last  named  is  a 
banking  institution)   an  administrative  council,    ^o-^  ^11  Pr^t,^ 
purposes    as  regards  formulation  and  carrying  out  of  policy,  this 
bX      ;upreme,  except  that  the  constitution  can  be  changed  only 
by  Lorable  action  of  two  thirds  of  the  members;  and  such  oth 
matters  as  make  an  expression  of  opinion  from  all  desirable  are 
referred  to  their  consideration.  .:„„  „t  the 

Smm  the  yerjLmture  of  the  or^nization  the  mam  function  ijfjbe 
admink^ve  council  has"  been  the  settlement  and  P^^^^^ 
latorditorties.   At  first  the  president  and  the  district  committees 
e£^eff-to  adjust  the  constantly  arising  disputes  without  the  serv- 
ices of  any  single  person  whose  entire  attention  could  be  devoted  to 
tWs  work    Every  dme  a  member  had  a  grievance  with  his  employees, 
no  nTatter  how  Uivial,  which  the  two  parties  could  not  settle  among 
themselves  word  was  sent  to  the  proper  district  committee    This 
had  to  meet  within  three  days  at  the  foundry  of  the  complaining 
member,  decide  on  the  merits  of  his  controversy,  and  if  it  appeared 
he  was  in  the  right,  arrange  for  such  support  as  they  were  willing 
to  alw  in  case  the  Union  pressed  the  issue.   It  was  also  found  nee  s- 
sarv  to  convene  the  entire  council  in  a  number  of  sessions  a  year 
Thus  the  time  and  effort  required  for  Association  affairs  on  the  part 
of  busy  men  was  so  great  as  to  involve  serious  neglect  of  their  own 
interest   Few  could  afford  to  take  responsible  offices,  and  those  who 
did  serve  felt  obliged  to  limit  their  terms  to  one  year.   The  member- 
ship of   the   administrative   council   and   district   committees   was 
therefore  constantly  changing. 


M^ 


y 
I 


1 


416       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  an  effort  to  make  the  burden  of  leadership  less  hea\y  the  salaried 
»ffice  of  commissioner  was  created  in  1901  for  the  purpose  of  giving 
me  man  charge  of  the  details  of  settling  labor  troubles  and  carrying 
ton  the  executive  work  of  ,the  Association.    This  has  greatly  relieved 
the  district  committees  as  well  as  the  president,  for  they  are  not 
called  in  now  until  all  preliminary  investigations  have  been  made  by 
the  commissioner.    When  he  believes  a  strike  cannot  be  averted    the 
committee  meet  to  decide  whether  or  not  they  will  grant  support. 
In  1906  the  president  was  allowed  a  salary  for  such  a  part  of  his 
time  as  the  growing  administrative  work  of  the  Association  required. 
The  result  of  these  changes  has  been  a  greater  permanence  in  the 
offices  and  a  higher  degree  of  efficiency  all  around.   An  adequate  office 
and  field  force  of  experts,  with  headquarters  in  Chicago,  New  York 
and  Buffalo,  handle  the  work  of  the  Association.    It  has  become  an 
exceedingly  effective  business  machine,  although  much  of  the  per- 
sonal interest  and  relationship  which  prevailed  when  the  group  was 
smaller  has  necessarily  been  lost. 

\     In  order  to  obtain  the  Association's  support  in  time  of  strike   a 
Idefinite  procedure  is  rigorously  exacted  of  all  members.    Experience 
has  proved  that  anything  short  of  this  is  sure  to  involve  endless 
misunderstandings  and  other  complications  of  a  more  serious  nature 
Before  the  defense  work  was  thoroughly  systematized  there  were 
many  disagreements  as  to  the  amount  of  compensation  and  the  cir- 
cumstances under  which  it  would  be  paid.    Members  took  action  and 
contracted  expenses  without  authority  from  officers,  council,  or  dis- 
trict committees,  and  expected  the  Association  to  get  them  out  of 
whatever  further  difficulties  this  involved  them  in  with  their  molders 
and  to  reimburse  them  for  all  expenditures.    When  this  was  refused 
hard  feeling,  resignations,  and  lawsuits  followed.    In  1904    in  the 
general  reorganization  of  the  Association's  affairs,  the  protective  sys- 
tem was  put  on  its  present  well-defined  basis,  and  it  was  distinctlv 
understood  that  thereafter  all  claims  would  be  thrown  out  entirely  if 
procedure  had  not  been  according  to  the  letter  of  the  by-laws 

A  member  having  trouble  with  his  men  is  required  to  notify  the 
commissioner  at  once,  in  writing,  giving  the  full  details  of  the  case 
An  immediate  investigation  is  then  made,  and  if  possible  the  breach 
IS  patched  up.    This  failing,  the  district  committee  is  called  together 
to  determine  whether  or  not  the  aggrieved  member's  cause  is  just 


11 


NATIONAL  FOUNDERS'  ASSOCIATION 


417 


and  the  findings  are  reported  to  the  administrative  ---  ^' ^  J^^^  \ 

rests  the  final  decision  as  to  the  granting  of  support,  its  na  ure,  and  \ 
amount.    By  asking  the  Association's  aid  the  -mber  Pla^^^^^^^^^ 
matter  entirely  in  its  hands  and  binds  himself  to  carry  out  any  dec^e 
of  the  council  or  of  those  acting  under  its  authority,  and  pending  the 
decision  he  can  make  no  settlement  nor  discharge  his  men  without 
the  consent  of  the  council.    In  case  support  is  granted  it  may  b    m 
any  one  or  more  of  the  three  ways  already  mentioned,  provuied  tha 
the  supplying  of  men  or  the  making  of  work  in  another  shop  shall 
not  be  undertaken  without  the  consent  of  the  member.    It  .s  further 
understood,  and  now  included  in  the  by-laws,  that  m  P-™  ^^J^ 
ers  having  the  work  done,  or  giving  a  money  compensation    o    he 
Tmount  of  two  dollars  per  man  per  day    this  ^^  ^^^  ^f^^'^l 
extent  of  70  per  cent  of  the  men  usually  employed  or  the  work 
produced  as  evidenced  by  the  last  quarterly  report. 

The  method  of  defense  having  been  decided  upon,  ^n  agreement  for 
support  is  entered  into  between  the  member  and  the  Association,  in 
which  the  latter  undertakes  to  assist  and  support  the  member  for  a 
reasonable  period,  this  aid  to  be  determined  by  the  administr^^^^^^^ 
council,  who  may  reduce  it  from  time  to  time  or  discontinue  it  entirely. 
The  member  in  return  agrees  that  the  aid  given  is  to  be  considered  a 
the  complete  satisfaction  of  all  claims  on  the  Association  because  of  or 
on  account  of  the  prevailing  strike,  agrees  not  to  make  any  terms  with 
the  strikers  or  the'  union  representatives  without  the  written  consent 
of  the  council,  agrees  to  provide  at  all  times  adequate  police  protection 
for  the  men  furnished,  and  to  absolve  the  Association  from  all  respon- 
sibility for  any  industrial  accidents  which  may  occur    Finally,  the. 
r^ember  agrees  that  for  a  period  of  one  year  following  the  satisfactory 
Xtment  of  the  trouble  he  will  conduct  his  foundry  strictly  on  the[ 

"open  shop"  plan.  .  . 

The  supDort  of  the  Association  is  by  no  means  g.ven  every  time  it 
is  requested,  and  in  no  case  is  a  member  entitled  to  aid  until  he  has 
been'in  the  organization  at  least  two  months  The  councd  m  |  s 
discretion  may  refuse  help  where  the  member  has  faded  to  adv^e 
the  commissioner  promptly  of  the  ^-^'^f  ^/^^  "ature  of  he  troub^ 
or  when  he  has  declined  to  comply  with  the  advice  of  the  president 
o  Tommissioner.  But  having  acted  in  accord  with  the  Association  s 
rules  in  all  respects,  a  member  can  expect  to  be  supported  in  any 


M 


J 


41 8       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

attempt  to  enforce  those  principles  for  which  it  stands,  as  enumerated  in 
the  outline  of  policy.  In  other  matters  the  granting  of  aid  will  depend 
upon  the  issue  involved  and  the  justice  of  the  member's  position. 

For  the  year  ending  November  i,  19 13,  the  support  of  the  Asso- 
ciation was  granted  in  thirty-two  shops.  As  understood  and  classified 
by  the  Association  the  issues  involved  were 

Refusal  to  work  with  nonunion  men 2 

Attempt  to  organize  and  force  closed  union  shops  .     .     .     .  i  r 

Control  of  molding  machines i 

Elimination  of  differential  wage  rate i 

Refusal  to  discharge  certain  men  for  nonpayment  of  special 

assessments  levied  by  the  Union i 

Demand  for  strictly  closed  union  shop 3 

Demand  for  closed  union  shop  and  reinstatement  of  men 

discharged  for  cause j 

Demand  for  minimum  wage  and  closed  union  shop  condi- 
tions    g 

Apprentice  ratio j 

Objection  to  employment  of  handymen i 

No  demands;    pickets  from  other  shops  on  strike  intimi- 
dated workmen  until  they  refused  to  work      .     .     .     .  i 
Objection  to  piecework  and  refusal  to  work  with  nonunion 
men j 

It  is  obvious,  of  course,  that  the  cause  assigned  by  the  employer 
in  any  dispute  may  be  quite  different  from  that  mentioned  by  the 
men,  and  that  often  these  causes  are  so  interrelated  as  to  make  a 
singling  out  of  any  one  utterly  impossible.  But  from  the  above  tabu- 
lation it  appears  that,  at  any  rate  in  the  employers'  view,  the  main- 
tenance of  Association  principles  against  the  attack  of  the  Union 
is  the  fundamental  reason  for  the  conflicts  in  support  of  which  the 
Association  lends  its  aid.  Even  if  other  factors  are  taken  into  ac- 
count, the  causes  assigned  by  the  Association  must  be  considered  to 
be  the  ones  it  believes  the  most  important. 

The  Association  by-laws  have  always  required  that  during  the 
existence  of  a  boycott  against  the  goods  made  by  any  member  none_ 
of  the  men  originating  the  bo^^t  should  be  countenanced  until  the 

^^^^™^^^^^-"?^^^^-  ^"  ^^^^^^  years,lince  the  anti-mjtnrcttGn  prop- 
aganda of  tHe  unions  has  become  so  important,  the  administrative 
council  of  the  Association  has  voted  in  individual  cases  to  support 


NATIONAL  FOUNDERS'  ASSOCIATION  419 

members  in  their  fights  to  have  injunctions  against  the  boycott  and 
other  union  practices  sustained. 

From  the  formation  of  the  Association  the  attitude  of  a  foundry- 
man  toward  trade-unionism  has  in  no  way  affected  his  admission  to 
membership.    He  can  recognize  the  Union  or  not,  as  he  pleases.    For 
although  the  Association  as  a  body  is  definitely  committed  to  the 
open-^hop  policy,  there  is  no  requirement  that  each  member  shall  run 
an  open  or  nonunion  shop,  nor,  indeed,  is  a  member  obliged  to  con- 
form to  the  outline  oj  policy  in  all  respects.    If  certain  circumstances 
make  it  appear  to  an  employer  that  he  will  be  advantaged  by  sigmng 
an  agreement  with  the  Union,  he  is  entirely  free  to  do  so.    The  one 
exception  is  that  alreadv  noted :  after  having  put  his  foundry  on  an 
open-shop  basis  through  the  aid  of  the  Association  when  he  was 
havincr  difficulties  with  the  Union,  he  must  retain  this  condition  for 
at  lealt  a  year.    During  the  period  of  the  agreement  with  the  Iron 
Molders'  Union  about  90  per  cent  of  the  Association's  shops  making 
heavy  machinery  were  union  and  80  per  cent  of  the  agricultural  and 
malleable  shops  were  open.^    At  the  present  time  85  per  cent  of  the 

members  run  open  shops.^  .    ,.    •     .  ^ 

Membership  in  the  National  Founders'  Association  is  limited  to 
"persons,  firms,  or  corporations  engaged  as  principals  in  and  opera- 
tors of  foundries  where  castings  in  iron,  steel,  brass,  or  other  metals 
are  made."    There  was  a  tacit  understanding  at  the  beginning  that 
no  foundr>'man  would  be  admitted  who  was  eligible  for  the  Stove 
Founders'  National  Defense  Association ;  and  in  practice  members 
who  made  castings  in  any  respect  similar  to  those  made  by  members 
of  the  latter  organization  were  supposed  to  be  guided  in  their  pro- 
cedure with  their  molders  as  far  as  possible  by  the  Stove  Founders' 
agreements.    In  the  last  few  years,  however,  due  to  a  growing  dis- 
similarity of  policy  of  the  two  associations,  this  practice  has  not  been 
observed,  and  a   number   of  stove  manufacturers  who   find   their 
attitude  toward  labor  unions  more  adequately  expressed  in  the  Na- 
tional Founders'  Association  than  in  the  Stove  Founders'  have  been 
admitted  to  the  former. 

1  Proceedings,  Conference,  Detroit,  November  9,   1899   (MS.),  pp.   12,  13; 
Proceedings,  N.F.A,  New  York,  November  13,  1901   (MS.),  p.  85. 

2  Hearings   before    the   United   States   Gommission    on    Industrial    Relations, 
Washington,  AprU  7,  1914  (MS.),  Vol.  I,  pp.  242-243,  245,  246,  248,  251. 


I 


1 ' 

ijiil 

i 


:t 


420       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  1900  the  first  classification  of  members  was  made  on  the  basis 
of  work  produced  in  their  shops/    The  results  were  as  follows : 

Agricultural 24 

Architectural g 

Brass  and  bronze a 

Engines  —  electrical,  mining,  and  new  machinery     .     .     .  yy 

Furnaces  and  heating j© 

General  foundry  work 1^3 

Light-gray  iron ■j^ 

Machine  tools,  etc 8 

Malleable " 29 

Pumps,  valves,  hydrants,  pipe 18 

Steel 10 

By  comparing  the  total  thus  represented  (365)  with  the  member- 
ship of  the  Association  (275)  at  the  time,  it  is  evident  that  a  number 
of  firms  were  making  two  or  more  kinds  of  castings.  At  present  a 
page  selected  at  random  in  the  published  directory  of  members  shows 
one  making  "structural,  engine,  and  railroad  castings,  sash  weights, 
castings  for  brick  and  butter-tub  machinery,  general  work";  another, 
''general  jobbing,  automobile  and  gray-iron  castings";  still  another, 
''air  compressors,  steam  pumps,  duplex  engine  governors";  which 
list  might  be  continued  indefinitely. 

During  the  first  few  years  tremendous  efforts  were  made  to  increase 
the  membership  of  the  Association.  No  method  of  selection  was 
used  and  bad  risks  frequently  were  taken.  Not  only  did  some  em- 
ployers who  were  notorious  for  always  having  strikes  in  their  shops 
gain  admission  and  demand  protection,  but  members  refused  to  pay 
their  assessments,  refused  to  obey  the  rulings  of  the  council,  and 
in  other  ways  caused  the  Association  much  trouble  and  expense. 
There  was,  of  course,  a  natural  tendency  for  concerns  not  to  value 
membership  very  highly  until  they  were  threatened  with  an  insurrec- 
tion of  their  employees,  and  they  would  then  seek  protection  in  the 
Association,  often  only  to  resign  when  the  difficulty  was  settled.  The 
membership  was  far  from  stable,  and  in  some  years  more  resigned 
than  were  admitted. 

1  Proceedings,  N.  F.  A.,  Detroit,  February  i,  1900,  p.  29;  N.  F.  A.,  Confidential 
Circular  No.  26;  N.F.A.  Handbook,  May,  1900. 


m 


NATIONAL  FOUNDERS'  ASSOCIATION  42 1 

For  a  time  the  law  of  the  Association  provided  that  "  no  person, 
firm    or  corporation  shall  be  elected  to  membership  who  shall  be 
engaged  in  a  strike,"  but  in  practice  this  rule  was  frequently  waived 
and  employers  whose  molders  had  actually  walked  out  were  admitted 
and  gained  protection.    In  many  cases,  by  pursumg  the  policy  of 
defending  such  a  firm,  a  further  extension  of  the  trouble  was  pre- 
vented and  the  welfare  of  the  Association  was  better  conserved  than 
would  have  been  the  case  had  the  struck  shop  been  denied  help  and 
been  forced  to  yield  to  the  Union's  demands,  since  such  concessions 
would  inevitably  have  spread  to  other  foundries  in  the  same  locahty. 
The  by-laws  were  therefore  changed  to  conform  to  practice,  and  a 
"probationary   membership"   was   created   to   take   care   of   those 
foundrymen  who  wished  to  join  during  a  strike.    The  administrative 
council  may,  after  investigation  and  careful  consideration,  by  a  two- 
thirds  vote  advance  a  probationer  to  full  membership  if  it  seems  to 
be  to  the  interest  of  the  Association  to  do  so.   While  on  probation  the 
member  pays  all  the  fees  and  assessments  of  a  regular  member  but 
receives  no  financial  benefit.  Members  are  not  allowed  to  resign  while 
they  are  in  the  midst  of  a  strike  or  pending  the  settlement  of  a  dispute, 
unless  by  special  consent  of  the  council  ;   and  in  any  event  four 
weeks'  notice  must  be  given  and  all  obligations  to  the  Association  be 
paid  in  full.   A  member  who  has  resigned  may  be  reinstated  by  the 
council  upon  payment  of  a  sum  equal  to  all  the  assessments  he  would 
have  paid  had  his  membership  continued  without  interruption. 

In  the  last  ten  years  great  care  has  been  exercised  in  the  selection 
of  members,  for  it  has  been  clearly  demonstrated  that  the  Associa- 
tion's strength  does  not  lie  in  numbers  alone.    In  an  effort  to  include 
only  the  best  firms  in  the  industry  every  application  for  membership 
is  carefully  investigated  before  it  goes  to  the  administrative  council. 
A  personal  visit  to  the  foundry  is  made  by  one  of  the  officers,  and  the 
firm's  financial  standing  and  general  reputation  is  looked  into.    It  is 
the  intention  to  keep  out  such  concerns  as  will  be  a  constant  source 
of  expense  or  may  in  other  ways  prove  undesirable.    If  the  prelim- 
inary investigation  shows  the  firm  to  be  running  an  up-to-date  plant, 
treating  its  employees  in  an  honorable  manner,  and  having  an  ade- 
quate financial  backing,  its  name  is  approved  by  a  two-thirds  vote 
of  the  administrative  council  and  is  then  sent  to  every  member  to 
be  voted  on.    Unless  ten  protests  to  admission  are  received,  election 


¥ 


42  2       TR.\DE  UNIONISM  AND  LABOR  PROBLEMS 

is  complete.  Objections  raised  by  other  members  in  the  district 
where  the  applicant  is  located  may  occasionally  keep  a  foundryman 
out,  but  for  the  most  part  the  procedure  is  purely  routine. 

Although  members  of  the  National  Founders'  Association  employ 
about  one  eighth  of  all  the  molders  and  coremakers  in  the  country/ 
their  importance  in  the  industry  is  probably  considerably  greater 
than  this  would  seem  to  indicate,  because  labor-saving  devices  not 
often  used  in  other  foundries  have  made  possible  in  Association  shops 
the  employment  of  fewer  men  in  proportion  to  the  value  of  the  out- 
put than  is  the  general  average.  The  foundries  vary  in  size  from 
small  jobbing  shops  employing  only  half  a  dozen  molders  to  the  huge 
establishments  of  some  of  the  best-known  manufacturers  of  heavy 
machinery  and  other  cast-iron  specialties.  No  firm  is  admitted  which 
is  capitalized  for  less  than  $50,000,  and  the  entire  membership  may 
at  times  represent  a  total  capital  of  half  a  billion.^  This  means,  in 
general,  that  they  are  the  most  progressive  and  most  efficiently  man- 
aged plants  in  the  country.  The  aim  of  the  Association  is  to  keep 
them  such,  for  in  developing  its  program  for  the  maintenance  of  in- 
dustrial peace  it  has  well  understood  how  important  a  part  is  played 
by  fair  conditions  of  work  and  a  body  of  contented  men. 

The  number  of  members,  the  number  of  foundries  represented,  and 
the  number  of  molders,  coremakers,  and  apprentices  employed  is 
given  in  the  following  table  :^ 

1  Cf.  Thirteenth  Census  of  the  United  States,  Vol.  IV,  Table  VI.  The  fact 
that  the  Association's  membership  contains  a  few  Canadian  foundries  makes  an 
exact  comparison  impossible. 

2  The  president  stated  in  1904  that  he  represented  600  members  with  a 
capitalization  of  $400,000,000,  employing  60,000  men  {The  Review,  March,  1904, 
p.  6) ;  and  in  1906,  525  members  were  credited  with  $500,000,000  capitalization 
{ibid.  March,  1906,  p.  13).  As  the  estimated  number  of  members  and  operatives 
is  considerably  in  excess  of  the  number  as  reported  by  the  secretary  for  these 
periods,  it  is  entirely  possible  that  the  statement  as  to  capital  represented  is 
somewhat  liable  to  correction. 

3  The  difference  between  number  of  members  and  number  of  foundries  is 
due  to  the  fact  that  some  of  the  concerns  operate  several  shops  in  different  parts 
of  the  country.  Since  1907  membership  has  been  counted  by  separate  foundries 
rather  than  firms,  but  the  secretary  has  estimated  the  number  of  the  latter 
these  foundries  represent.  Figures  are  for  June,  1898;  February,  1899;  the 
average  of  the  last  quarter  for  1900;  and  for  the  succeeding  years,  for  the  time 
of  the  annual  meeting  in  November.  Number  of  operatives  given  for  1899  is 
approximate.  The  secretary  reported  94  firms  with  an  average  of  59  employees 
each.     (Proceedings,  N.F.A.,  Buffalo,  February  i,  1899.) 


NATIONAL  FOUNDERS'  ASSOCIATION  423 


Year 


1898 

1899 

1900 

I901 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

19II 

1912 

I914 


Number  of 
Members 


66 

94 

369 

377 
494 
536 
456 

456 

475 
421 

419 

408 

426 

454 
484 
500 
484 


Number  of 
Foundries 


Number  of 
Operatives 


5,500 
1 6,646 


527 

27>3^9 

579 

•        •        • 

500 

23o59 

531 

.        •       • 

474 

22,295 

467 

14,373 

467 

18,585 

492 

22,039 

489 

20,142 

520 

23,593 

536 

25-930 

=;i4 

21,598 

Up  to  the  end  of  1903  the  membership  grew  rapidly,  but  smce 
then  the  growth  has  not  been  maintained.   The  causes  of  the  change 
are  several.   The  modification  of  policy  as  to  mere  numbers  has 
already  been  noted.    Between  1898  and  1903  there  was  probably  not 
an  employer  of  molders  in  the  United  States  or  Canada  who  did  not 
have  urged  upon  him  at  meetings  or  through  letters  or  personal 
interviews  the  benefit  of  membership.   Then,  too,  the  years  from 
1899  to  1903  saw  a  boom  in  the  foundry  industry  such  as  it  has  not 
since  experienced.   This  meant  a  greater  growth  of  the  Iron  Molders 
Union  and  more  aggressive  activities  than  have  occurred  at  any 
similar  period  in  the  Association's  history.   Thus  there  was  a  very 
special  reason  for  many  foundrymen  to  seek  protection  from  the 
demands  of  their  men.    Some  of  the  heavy  increase  in  1899  and  1900 
must  certainly  be  attributed  to  the  signing  of  the  agreement  with  the 
Union,  about  the  efficacy  of  which  as  a  preventive  of  strikes  all  were 
very  optimistic.   After  1903  the  attitude  of  the  Association  began 
to  change  and  many  members  resigned,  some  on  that  account  and 
some  because  the  industrial  boom  was  waning.    Between  Novem- 
ber   1903,  and  April,   1904,  sixty-five  resignations  were  received 
while  only  twenty-one  members  joined;  between  April  and  August 


424       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

thirty-three  resigned  and  seven  were  added;  between  August  and 
November  thirteen  resigned  and  two  were  added.  The  reasons  given 
for  these  withdrawals  were  that  the  Association  was  of  no  assistance 
to  the  members  because  of  their  isolation,  failure  in  business,  expense, 
disagreement  with  the  Association's  policy.^ 

No  loss  whatever  occurred  because  of  the  complete  change  of  pro- 
cedure in  1904,  although  there  was  considerable  fear  that  this  result 
would  follow  the  abrogating  of  the  agreement.    Some  change  in  the 
personnel  took  place,  of  course,  but  resignations  were  fully  counter- 
balanced by  the  acquisition  of  foundrymen  who  had  previously  re- 
frained from  allying  themselves  with  an  organization  which  they  felt 
tended  to  foster  in  their  shops  what  they  believed  to  be  the  un- 
economic and  unfair  practices  of  unionism,  and  to  that  extent  handi- 
capped them  as  against  some  of  their  competitors.    Such  fluctuations 
as  have  taken  place  since  1903  may  be  explained  almost  entirely  by 
referring  to  industrial  conditions  and  the  state  of  the  labor  market. 
When  times  are  good  and  molders  in  demand  membership  increases. 
When  the  contrary  is  true  the  Association  is  not  so  large.    There  has 
been  nothing  of  late  years  in  the  way  of  generally  prevalent  labor 
troubles  to  force  employers  into  the  Association.    It  was  reported  at 
the  annual  meeting  in  November,   19 14,  that  protection  had  been 
required  for  only  five  members  during  the  preceding  year;  in  19 13 
there  were  thirty-two  strikes,  and  the  membership  was  somewhat 
greater  than  in  1914;   in  1912   twenty-one  shops  were  protected.- 
Of  the  foundrymen  who  stay  out  of  the  Association  some  consider 
it  too  radical,  others  are  satisfied  to  allow  it  to  provide  conditions 
making  for  an  industrial  peace  in  which  they  share  but  with  the 
expense   of   which   they   are   unwilling   to   be   burdened,   and   still 
others   have    always    succeeded    in    maintaining    such    harmonious 
relations  with  their  men  that  they  feel  no  need  of  help  from  the 
Association. 

It  has  been  suggested  that  the  weakening  of  local  influence  which 
resulted  when  the  district  committees  ceased  to  come  intimately  in 
touch  with  individual  affairs  might  be  mitigated  by  the  formation 

^Proceedings,  N.  F.  A.,  Cincinnati,  November  16,  1904,  in  the  Review, 
December,  1904,  p.  9. 

-Iron  Trade  Review,  November  26,  1914,  p.  1004;  Proceedings,  N.F.A., 
New  York,  November  19,  1913,  p.  17;  id.  New  York,  November  20,  1912,  p.  29. 


NATIONAL  FOUNDERS'  ASSOCIATION  425 

of  local  bodies  of  foundrymen  coming  together  in  the  national  Asso- 
ciation, but  this  has  never  proved  feasible.    There  are  already  local 
organisations  of  foundrymen  in  a  few  of  the  large  centers,  to  which 
members  of  the  National  Founders'  Association  m  some  cases  belong, 
but  as  a  rule  the  local  groups  have  been  so  heterogeneous  m  their 
constituency  as  to  make  an  effective  method  of  control  impossible, 
and  except  for  occasional  cooperation  in  the  handling  of  a  particular 
local  matter,  there  has  never  been  any  connection  between  the  two^ 
An  annual  meeting  of  the  Association  is  held  in  November  at  which 
officers  and  district  committees  are  elected.    It  is  a  well-established 
practice  that  the  vice  chairmen  of  the  latter  shall  succeed  the  nex 
year  to  the  chairmanship.   Votes  have  always  been  allowed  on  all 
subjects  in  proportion  to  the  assessments  paid.   At  present  each  niem- 
ber  has  one  vote,  and  those  members  whose  assessments  exceed  $100 
a  year  are  entitled  to  one  additional  vote  for  every  $100  so  paid. 
In  the  formative  years  much  of  the  time  of  the  convention  was  neces- 
sarily devoted  to  discussions  of  policy,  government,  and  administra- 
tive details.    But  the  constitution  and  by-laws,  as  well  as  the  policy 
which  crystallized  in  1904,  have  proved  so  satisfactory  as  to  have 
occasioned  no  subsequent  concern.    Except  for  the  necessary  routine 
business  the  annual  meetings  are  devoted  to  consideration  of  the 
larger  aspects  of  the  labor  problem,  such  as  legislation,  both  state 
and  federal,  safety  and  sanitation  work,  industrial  education,  and  the 
like    At  many  of  the  meetings  there  is  no  mention  whatever  of  trade- 
unions    Even  the  administrative  council  now  meets  only  at  the  time 
of  the  annual  convention,  since  there  is  no  constitutional  rule  regard- 
ing this  beyond  the  provision  that  the  president  shall  convene  it  in 
his  discretion  or  on  the  written  request  of  four  members.    Special 
meetings  of  the  entire  Association  may  be  called  when  there  are 
grave  conditions  threatening  its  welfare,  but  only  three  have  ever 
been  held,  the  last  at  the  time  of  the  great  molders'  strike  in  1906. 
When  such  emergency  meetings  are  held,  any  decision  there  reached 
becomes  binding  on  all  members. 

Foundrymen  on  joining  the  Association  agree 

ist,  In  consideration  of  fair  dealing  being  a  cardinal  principle  o! 
this  Association,  to  protect  any  of  our  fellow  members  who  may  re- 
quire o^^^^^^^  against  any  unjust  demands  of  labor  organizations 
and  to  endeavor  to  settle  all  disputes  amicably. 


tmsu 


42  6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

2d,  To  obey  the  constitution  and  by-laws  and  all  rules  made  in 
conformity  with  the  same,  provided  they  do  not  conflict  with  the 
laws  of  the  country,  state,  or  province  in  which  we  do  business. 

No  bond  is  required  that  this  pledge  will  be  kept,  and  at  first  the 
disciplinary  machinery  was  so  defective  that  members  could  disregard 
their  obligations  with  impunity.  A  particularly  bad  breach  of  faith 
on  the  part  of  some  members  in  190 1  led  to  the  strengthening  of  the 
hands  of  the  officers  so  as  to  give  power  of  investigation  and  suspen- 
sion for  cause,  and  this  has  been  used  in  a  few  cases  where  the  mem- 
ber concerned  settled  with  the  Union  after  agreeing  to  leave  his 
dispute  entirely  in  the  hands  of  the  administrative  council.  It  never 
was  used  to  force  members  to  live  up  to  the  agreement  with  the  Union, 
although  there  were  a  number  of  cases  of  violation  in  which  support 
was  denied. 

I    Especially  difficult  have  been  the  cases  in  which  members  have 
Refused  to  meet  their  financial  obligations.    The  by-laws  require  that 
if  assessments  are  not  paid  as  they  become  due  (that  is,  within  thirty 
days  after  proper  notification),  a  draft  shall  be  drawn  against  the 
delinquent.    If  he  fails  to  honor  this,  his  membership  in  the  Associa- 
tion ceases  automatically,  except  that  the  council  may  reinstate  him 
upon  his  showing  cause  for  nonpayment,  and  meeting  all  past  in- 
debtedness.   On  the  other  hand,  members  are  not  expected  to  leave 
with  dues  to  the  Association  unpaid.    If  sight  drafts  and  collectors 
fail  to  secure  payment,  a  lawsuit  may  result.    The  decision  in  an 
mteresting  litigation  in  Ohio  in  1904  established  the  legal  status  of 
employers'  associations  and  their  right  to  control  their  members.    It 
was  held  that,  being  formed  for  the  purpose  of  mutual  protection,  the 
Association  could  not  only  sue  and  recover  for  dues  and  assessments 
but  also  that  the  application  for  membership  and  the  acceptance 
thereof  constituted  a  valid  contract,  and  that  thereafter  the  member 
was  bound  by  the  constitution  and  by-laws.^ 

The  initial  financial  system  left  much  to  be  desired  both  as  to 
income  and  expenditure.  The  annual  dues  of  S50  went  into  a 
general  fund,  available  for  current  expenses,  and,  in  addition  all 
members  on  joining  paid  into  the  reserve  fund  such  a  sum  in  propor- 
tion to  the  unexpended  balance  of  the  fund  as  the  number  of  molders 

^National  Founders^  Association  v.  Taplin  Rice  and  Companv,  Court  of 
Common  Pleas,  Akron,  Ohio,  1904.    See  The  Review,  January,  1905,  pp.  13-16. 


I 


NATIONAL  FOUNDERS'  ASSOCIATION 


427 


they  employed  bore  to  the  total  number  of  molders  employed  by  all 
members.  Each  member  paid  to  the  reserve  fund  10  cents  a  month 
for  every  molder  employed,  molders'  and  coremakers'  apprentices  and 
unskilled  coremakers  counting  two  as  one  molder.  The  basis  of  these 
assessments  was  the  average  maximum  number  of  molders  employed 
in  each  month  of  the  preceding  quarter  as  reported  to  the  secretary. 

But  these  sums  were  not  sufficient  to  carry  on  the  work  of  the 
Association,  and  special  assessments  of  $1   a  molder  were  levied, 
sometimes  one,  two,  or  more  a  year.    This  meant  for  many  members 
a  great  expense,  not  always  commensurate  with  the  benefit  they  were 
receiving.    One  of  the  largest  concerns  in  the  organization  paid  in 
one  year  S600  in  regular  assessments  and  between  $3000  and  $4000 
in  special  assessments.    In  1900  the  contribution  which  a  firm  joining 
would  have  to  make  to  the  reserve  fund  averaged  a  little  more  than 
$11  per  molder,  and  the  total  amount  paid  was  in  some  cases  S600 
and  S700.'    This  heavy  expense  brought  a  number  of  resignations. 
Other  members  believed  that  the  burden  was  not  fairly  distributed,  in 
that  there  was  no  gradation  of  assessment  on  the  basis  of  the  molders' 
skill,  although  it  was  well  known  that  loam  or  machinery  molders 
were  infinitely  harder  to  replace  than  squeezer  men  or  machine 
operators.    In  1902  a  change  was  made  to  take  account  of  this,  and 
again  in  1904,  so  that  at  the  present  time  the  assessments  are  as 
follows :  for  journeymen  floor  molders,  40  cents  per  man  per  month  ; 
for  journeymen  bench  molders  and  journeymen  coremakers,  30  cents 
per  man  per  month ;  for  molders'  apprentices,  specialty  molders  not 
skilled  in  the  general  trade  of  molding,  molding-machine  operators, 
unskilled   coremakers,   and   coremakers'   apprentices,    20   cents   per 
man  per  month ;  but  in  no  case  may  the  dues  amount  to  less  than 

$15  per  quarter. 

The  only  foundry  employees  upon  whom  Association  members 
pay  assessments  and  against  whose  strikes  protection  is  supplied  are 
molders  of  varying  degrees  of  skill  and  coremakers.  In  1906,  when 
the  Brotherhood  of  Foundry  Employees  (a  union  of  cupola  tenders, 
helpers,  gangway  men,  and  the  like)  seemed  to  be  growing  in  power 
and  importance,  the  oflicers  of  the  Association  considered  the  ad- 
visability of  including  them  as  assessable  operatives,  with  consequent 
protection  to  members  in  case  of  trouble  from  that  source.    But  no 

1  Proceedings,  N.F.A.,  New  York,  November  13,  1901  (MS.),  pp.  67,  83. 


af 


1 


428      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

steps  have  been  taken  to  bring  about  this  added  service,  due  no 
doubt  to  the  fact  that  such  unskilled  help  is  replaced  so  easily  that 
individual  employers  can  fill  without  difficulty  any  vacancy  caused 
by  their  striking  and  that  no  need  has  been  felt  for  the  Association  to 
assume  this  responsibility. 

Data  regarding  assessable  operatives  have  been  furnished  by  the 
secretary' of  the  Association  from  the  reports  of  members  for  the  last 
quarter  of  selected  years.' 


IQOO 

1902 

1905 

igio 

'913 

Floor  molders  (skilled)     .... 
Bench  molders  (skilled)    .... 
Floor  and  bench  molders     .    . 

•  •               ■ 

•  •               • 

10,034 

10,527 
4,220 

8,900 
3,063 

6,404 
2,586 

7,430 

2,S00 

Specialty  molders 

1,807 

2,489 

•          •          • 

Specialty   molders  and    machine 
operators 

4,067 

*               •               • 

3,060 

Specialty  molders  and  apprentices 

1,959 
1,248 

•          •           • 

•         •         • 

Molding-machine  operators  .    . 
Holders'  apprentices 

.        .        . 

2,716 
2,432 

3,219 
1,861 

4,502 
1,968 

Holders'    apprentices,    unskilled 
coremakers,  and  apprentices     . 

1,907 

•              •               • 

5,837 
2,738 

Coremakers  (journeymen)    .     .     . 
Coremakers  (unskilled)     .... 

2,217 

i»357 
867 

2,268 

1,445 
862 

2,660 

Coremakers' apprentices .    .    .    . 

^913 
887 

Coremakers  (specialty  and  appren- 
tices)      

1,498 

•               ■               • 

Total 

•        •       • 

•        •        • 

. 

16,646 

27,389 

22,359 

21,134 

25,220 

\  The  annual  dues  of  S50  have  been  abolished,  but  the  original  pro- 
vision for  contribution  to  the  reserve  fund  on  joining  has  been  re- 
\  tamed  and  supplemented  by  a  further  provision  that  the  council  may 
Ihn  Its  discretion,  collect  an  even  greater  sum.  The  aim  has  always 
been  to  build  up  a  reserve  or  defense  fund  of  sufficient  size  to  provide 
for  emergencies,  which  should  at  the  same  time  serve  as  a  preventive 
of  as  well  as  a  protection  against  the  excessive  demands  of  a  too  con- 
fident union.  The  enormous  defense  fund  of  the  Stove  Founders' 
National  Defense  Association,  which  has  not  had  a  strike  of  its 

1  The  figures  given  here  differ  somewhat  from  those  presented  on  page  X2X 
due  to  the  fact  that  the  latter,  except  for  1900,  are  as  reported  aHhe  annu^' 
meeting  in  November  and  are  for  the  third  rather  than  the  last  quarter 


NATIONAL  FOUNDERS'  ASSOCIATION 


429 


1 


mnlders  in  twenty-five  years,  has  seemed  a  feature  desirable  to  copy . 
Fofa^eTwas  quite  impossible  to  accumulate  -JY  -ch  ^  ^^^^^ 
reserve  but  in  1903,  due  to  the  growing  conv.ct.on  that  Ae  financial 
baT^as  not  enUreiy  sound,  a  number  of  changes  w«e  made  wh.  h 
laid  the  foundation  for  the  present  system.    S'-e  then  a  res^=rve  fun 
of  some  size  has  been  continuously  mamtamed     A"  ass™ts  no 
„n  into  the  general  fund ;  from  this  appropriations  to  the  reserve  are 
made  from  ^tae  to  time  by  the  administrative  council,  m  whose  care 
1^1  fin  nc"al  matters  have  been  placed.    Special  assessments  are  levied 
"onally  for  the  purpose  of  increasing  the  reserve  fund  an    thus 
eoualizing  the  cost  of  labor  troubles  over  a  period  of  years,  ana 
Ihey  hive  also  been  asked  to  meet  the  requirements  of  an  unusually 

^lSX>::^!S%ntem.nUs.^ll^d.  Any  estimate  ^  the  As.- 

ciato^s    ncome  based  oTrt^l^a  previously  P"-«^«"ted  as  to    he 

number  of  operatives  upon  whom  assessments  are  paid  is  of  little 

:i  because  of  the  unknown  but  fairly  frequent  special  asse^mnt. 

In  a  sense  the  financial  resources  are  unlimited,  for  no  difficulty    s 

exper  enced  in  collecting  funds  when  real  danger  threatens   and  it  . 

he  poUcy  to  ask  for  extra  contributions  at  such  t.mes  instead  of 

drawing  on  the  reserve  fund.   No  one  resigning  or  expelled  is  entitled 

0  a  Sd  on  what  he  has  paid  in,  unless  he  is  retirmg   rom  bu,nes 

in  which  case  he  receives  such  a  proportion  of  the  reserve  as  n  s 

LcSage  of  contribution  to  the  average  of  the  last  two  assessments 

hears  to  the  balance  of  the  fund  unappropriated. 

The  deense  work  of  the  National  Founders'  Association  thus  fa 
deS  bed  has  been  that  which  aids  members  who  have  come  into 
a     al  conflict  with  the  Iron  Holders'  Union.    Ajjer  P^^^V^ 
actrvitv  is  concerned  directly  with  the  prevention  of  strikes,    ine 
underfakngs  which  have  been  engaged  in  for  the  purpose  primarily 
of  avoilg  labor  difficulties  and  building  up  a  strong  body  of  non- 
irllders  should  be  briefly  mentioned^   T ^rTC^ 
factory  trial  of  private-detective  agencies  the  AssociaUonhasJayP- 
over  Us  own  sec'et-service  work  in  a  department  organized  exprs^y 
t^WnnforinSnmnFomlprcial  representatives,  "".on  and  inde- 
pendent, in  the  shops  of  its  members.   These  confidential   corre- 
snondents  keep  the  Association  informed  as  to  conditions  in  the 
SrTet  report  incipient  trouble  and  proposed  outbreaks  of  the 


\ 


/ 


430       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Union  together  with  suggestions  as  to  how  they  may  be  averted, 
and  help  in  running  down  union  thugs,  wrecking  gangs,  and  opera- 
tions of  a  lawless  nature  designed  to  harm  Association  plants  and 
nonunion  laborers.    At  no  time  was  the  inherent  usefulness  of  this 
branch  of  the  Association's  work  better  demonstrated  than  in  1906, 
when  through  its  channels  information  was  received  as  to  the  demands 
which  were  to  be  made  by  the  Union  on  May  i.    The  Association, 
being  unwilling  to  meet  them,  had  ample  time  to  prepare  for  the 
general  strike  which  followed.    Organized  safety  and  sanitation  work 
has  been  recently  undertaken,  partly  to  meet  the  new  workmen's 
compensation  laws  and  partly  as  another  means  of  keeping  the  men 
contented  by  giving  them  better  places  in  which  to  work,  thereby 
decreasing  the  likelihood  of  strikes.    The  encouragement  of  friendly 
relations  between  employer  and  foremen,  that  the  latter  may  side 
with  the  firm  rather  than  with  the  Union  in  case  of  trouble;   of 
proper  training  for  apprentices ;  of  the  installation  of  molding  ma- 
chines, specialization,  etc.,  so  as  to  avoid  the  worst  features  of  cessa- 
tions; the  insistence  upon  fair  conditions  generally,— are  all  a  part 
of  the  Association's  defense  system,  that  seems  to  have  borne  fruit 
in  the  increasing  size  and  representativeness  of  the  body  of  non- 
union men  who  are  loyal  to  the  Association  and  can  be  depended 
upon  whenever  the  Union  undertakes  to  cross  the  path  of  their 
employers. 

Inability  to  reach  their  men  in  such  a  way  as  to  put  before  them 
fairly  the  principles  for  which  the  Association  stands,  and  the  larger 
aspects  of  the  labor  problem  generally,  was  early  recognized  as  a 
serious  handicap  to  the  establishment  of  the  desired  relations  be- 
tween employer  and  employees,  and  in  1904  an  attempt  was  made 
systematically  to  counteract  the  teachings  of  unionism  on  these 
points  by  publishing  and  distributing  to  the  molders  of  the  country 
such  printed  material  as  would  correctly  state  the  Association's 
position,  what  were  believed  to  be  the  fallacies  of  the  trade-union 
arguments,  and  the  program  of  equitable  dealing  under  which  the 
Association  aims  to  operate  its  shops.  The  leaflets  of  this  original 
experiment  have  expanded  into  a  creditable  monthly  journal  known 
as  the  Review,  which  is  published  jointly  with  the  National  Metal 
Trades  Association,  and  which  has  a  mailing  list  of  12,000  names. 
Its  purpose  is  to  provide  gratuitously  reading  material  dealing  with 


NATIONAL  FOUNDERS'  ASSOCIATION  43 1 

trade  and  industrial  questions  for  the  metal  workers  of  the  country, 
who  otherwise  have  to  depend  upon  what  is  thought  to  be  the  one- 
sided interpretation  presented  in  the  Iron  Holders'  Journal  and  similar 
organs.  In  the  Review,  of  course,  emphasis  is  laid  on  the  justice  of 
the  Association's  position  in  the  matter  of  industrial  relations 

With  the  perfecting  of  the  defense  system  as  outlined,  the  Asso- 
ciation has  been  free  to  devote  itself  to  other  phases  of  the  problem 
which  is  its  chief  interest.   It  has  cooperated  with  those  orgamzations 
whose  purpose  is  to  repress  the  enactment  of  laws  which  make  for  . 
the  benefit  of  union  men  as  against  nonunion  men  and  the  manu-  \ 
facturers    To  this  end,  it  has  joined  with  the  National  Association 
of  Manufacturers,  the  National  Council  for  Industrial  Defense,  and 
the  Anti-Boycott  Association  in  fighting  anti-injunction  laws,  laws 
designed  to  limit  employment  in  various  ways  (as  certain  regulations 
of  hours),  certain  types  of  workmen's  compensation  laws,  minimum- 
wage  laws,  and  the  like.   The  National  Founders'  Association  has 
itself  at  times  retained  a  representative  in  Washington  to  watch 
proposed  legislation  of  possible  interest  to  the  Association  and  to 
direct  attempts  to  quash  such  as  is  undesirable.    On  the  other  hand, 
the  Association  has  given  hearty  support  to  those  laws  which  it  be- 
lieves fair  and  proper.    One  of  the  first  men  who  studied  the  work- 
men's compensation  question  was  appointed  to  do  so  by  the  National 
Founders'  Association  and  was  afterwards  sent  to  Europe  for  the 
same  purpose  by  the  state  of  Minnesota.    The  Association's  safety 
and  sanitation  expert  has  helped  to  draft  a  number  of  state  compen- 
sation laws,  that  of  Indiana  being  the  Association's  model  law  almost 
in  toto     The  Foundry  Code  recently  adopted  by  New  York  state  was 
drawn  up  by  a  board  of  employers  all  but  one  of  whom  were  members 
of  the  National  Founders'  Association. 

Enou-h  has  been  said  to  show  that  the  National  Founders'  Asso- 
ciation, although  a  voluntary  organization  formed  to  deal  collectively 
with  the  employees  of  its  members,  is  as  much  of  a  business  as  is  the 
conduct  of  the  private  enterprises  of  any  one  of  its  constituency.  Its 
creed  is  said  to  be  based  on  the  assumption  that  its  members  and 
their  men  are  living  in  a  free  country  and  that  their  constitutionally 
guaranteed  freedom  to  contract  must  not  be  interfered  with  by  pri- 
vate or  public  forces.  It  directs  its  strength  against  those  agencies 
which  are  thought  to  hold  a  contrary  view  and  has  organized  its  own 


/ 


432       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

activities  so  as  best  to  meet  the  opposition  and  advance  its  own 
welfare.  But  though  all  business  is  selfish  in  essence,  and  though  the 
National  Founders'  Association  is  putting  into  operation  those  under- 
takings which  make  for  its  own  protection,  yet  it  provides  at  the 
same  time  safe  and  sanitary  places  in  which  to  work,  hours  no  longer 
than  the  going  schedule,  and  wages  often  in  excess  of  the  union  rate. 
While  objection  may  be  raised  to  the  paternalism  this  program  in- 
volves, the  Association  has  always  justified  it  on  the  ground  that  in 
protecting  the  independent  molders  of  the  country  against  union 
monopoly  it  is  performing  a  real  service  for  those  men  who  wish  to 
be  unrestricted  but  who  without  support  from  their  employers  would 
never  be  able  to  throw  off  the  union  control  which  they  find  irksome. 
The  present  paper  does  not  aim  to  decide  which  condition  is  the 
more  desirable. 

Margaret  Loomis  Stecker 

Cambridge,  Massachusetts 


-OmB 


XXIX 

THE  FOUNDERS,  THE  MOLDERS,  AND  THE 

MOLDING  MACHINE' 

'"THE  manufactures  of  iron  fall  into  three  general  classes:  cast 
i   iron,  wrought  iron,  and  steel.   The  present  paper  deals  with 
some  recent  problems  connected  with  the  manufacture  of  cast  iron 

Castings  are  made  by  preparing  a  pattern  of  the  object,  usually 
of  wood,  and  imbedding  this  in  a  matrix  of  sand  or  loam  of  such  a 
composition  as  will  retain  the  shape  into  which  it  is  pressed.   The 
mold  thus  formed  is  made  in  two  or  more  parts,  later  clamped  to- 
gether, with  only  a  small  hole  or  gate  through  which  the  metal, 
reduced  to  a  fluid  state  in  the  furnace  or  cupola,  is  poured    When 
cool,  the  casting  is  shaken  out  from  the  sand,  is  cleaned,  and  is  then 
ready  for  whatever  finishing  processes  are  needed.   The  general  in- 
dustry of  casting  metal  is  called  founding,  the  workers  are  molders, 
the  proprietors  of  the  shops  are  founders  or  foundrymen,  and  the 
shops  themselves  are  foundries.  ■  ,       ,         i     .1, 

Sometimes  foundries  are  adjunct  to  factories  and  make  only  the 
castings  needed  for  the  finished  products  of  the  machine  shop. 
Sometimes  they  are  not  connected  with  any  other  establishments, 
but  do  a  general  machinery  and  jobbing  business  independently  or 
on  contract  from  concerns  which  have  no  foundries  of  their  own. 
Sometimes  they  are  large  or  small  specialty  shops  turning  out  stand- 
ardized products  ready  for  the  market.    Sometimes  they  combine  all 

■From  Quarterly  Journal  0,  Econon^^^  l^f:il::t^ti:t::lu 
=  The  expansion  of  the  automobile  mdust^  m  the 'f  J^^ J         ^  ^jh,  „„,e 

a  great  demand  for  brass  and  alummum  ^*^''"?  .,f'f  j^,;';"'  its  classification 
recent  development  in  the  trade.    The  census^n^  ude   a,ese  m  >  .^ 

of  foundry  and  machine-shop  products    the  Nationa'  *ou 
open  to  foundrymen  in  all  b-ches  0^  the    ndu  t  v    and^  h^^^^^  ^   ^^^^^^ 

jurisdiction  over  all  molders.   Th',  P"^^"?*  "'"i^'      :„  ^^oi  changed  its  name 
with  the  entire  field  of  molding.    Although  the  Union  '^  ^  W  ^^l^^  «  ^^ 

from  "Iron  Molders"'  to  "International  Molders,     the  lormer 
retained  in  the  present  discussion. 

433 


434      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

three  of  the  features  just  described.  Foundry  and  machine-shop  prod- 
ucts are  classed  together  in  the  census.  They  are  for  the  most  part 
mutually  dependent,  however,  hence  the  data  there  presented  are 
significant  as  indicating,  in  a  way,  the  importance  of  founding.  In 
1909,  foundry  and  machine-shop  products  were  the  second  most  im- 
portant manufacturing  industry  in  the  United  States,  in  both  the 
number  of  wage-earners  employed  and  in  the  value  of  the  finished 
goods.  Not  including  such  distinctive  articles  as  cash  registers,  cal- 
culating machines,  sewing  machines,  electrical  machinery,  etc.,  there 
were  531,011  wage-earners,  and  the  products  were  valued  at  $1,228,- 
475,000.^  July  I,  19 1 2,  4949  foundries  were  reported  in  the  United 
States  making  steel,  gray-iron,  and  malleable  castings.  If  brass  and 
aluminum  castings  are  added,  the  total  in  19 12  was  5996.^ 

The  technical  development  of  few  industries  was  so  long  retarded 
as  was  founding.  For  many  years  manufacturers  were  content  with 
a  shed  and  the  most  primitive  implements.  The  main  essential  in 
the  production  of  castings  was  thought  to  be  a  group  of  skilled 
artisans.  The  molder  was  supreme.  He  was  supposed  to  be  core- 
maker,^  molder,  and  cupola  tender  all  in  one.  He  cut  over  his  own 
sand,  shook  out  and  cleaned  his  own  castings,  and  had  very  little  to 
work  with  except  iron,  fuel,  sand,  and  a  few  simple  tools.  Though 
rough  and  dirty,  molding  was  yet  a  highly  skilled  trade  requiring 
considerable  technical  proficiency,  in  which  the  processes,  many  of 
them  apparently  simple,  demanded  long  training  and  experience. 
A  man  had  to  know  how  to  treat  his  sand  so  as  to  get  a  mixture  just 
suitable  for  withstanding  the  heat  and  force  of  the  molten  metal. 
He  had  to  set  the  cores  accurately  and  ram  the  sand  around  the  pat- 
tern so  as  to  get  a  true  and  substantial  matrix.  Drawing  the  pattern 
so  as  not  to  break  the  mold  was  a  very  delicate  process,  and  any  re- 
sulting imperfection  had  to  be  carefully  patched.  The  mold  had  to 
be  properly  vented  to  allow  for  the  escape  of  gas  arising  when  the 
metal  was  poured.  The  iron,  melted  to  white  heat  in  the  cupola,  was 
poured  by  the  molder,  who  carried  his  own  ladle  from  furnace  to 

1  Thirteenth  Census  of  the  United  States,  iqio.    Abstract,  pp.  440-442. 

^The  Foundry,  Vol.  XL  (August,  1912),  pp.  329,  330, 

•"^  Cores  are  made  of  sand  and  placed  in  the  molds  to  form  interior  openings 
or  holes  in  the  castings  when  the  pattern  itself  does  not  allow  for  these.  Mold- 
ing and  coremaking,  though  closely  related,  have  long  been  considered  by  the 
workmen  to  be  separate  trades. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      435 

mold.  In  the  process,  if  the  mold  was  not  properly  made,  an  ex- 
plosion might  occur ;  or  pieces  of  sand  might  break  loose  and  run 
in  with  the  iron ;  or  the  metal  might  not  flow  freely  and  evenly,  thus 
leaving  unjoined  portions  ;  or  it  might  shrink  internally,  causing  holes 
and  spongy  places.  In  any  of  these  circumstances  the  casting  was 
imperfect ;  his  time  and  the  material  had  been  wasted. 

True,  even  at  this  time  all  foundry  work  did  not  demand  the  same 
degree  of  skill.  The  making  of  small  and  light  flasks  on  the  bench 
has  always  required  less  of  the  molder  than  patterns  so  large  and 
complicated  as  to  necessitate  their  being  bedded  directly  in  a  pit  of 
sand  or  loam  in  the  floor.  Floor  molding,  especially  if  the  design  is 
worked  out  in  loam  with  a  sweep,  requires  the  highest  skill  in  the 
trade,  and  is,  because  of  the  position  of  the  worker,  arduous  besides. 
Bench  molders,  on  the  other  hand,  making  the  smaller  patterns,  turn 
out  in  a  given  time  a  larger  number  of  castings.  Machinery  and  job- 
bing work  usually  takes  the  best  mechanics  in  the  trade.  Specialty 
work,  of  which  there  are  some  fifty  varieties,^  is  to  a  large  extent 
repetitive  and  demands  a  varying  range  of  ability. 

The  first  attempts  to  substitute  mechanical  devices  for  the  molder's 
skill  were  crude  and  attracted  little  attention.  But  the  inventors 
persevered,  and  when  finally  the  time  came  that  molders  were  not 
to  be  had  except  at  wages  beyond  the  average  employer's  reach, 
if  at  all,  and  then  on  terms  he  found  distasteful,  the  producers  of 
foundry  machinery  were  ready  to  equip  his  shop  with  all  sorts  of 
appliances  intended  to  relieve  him  of  his  dependence  on  human  labor. 
The  result  is  a  foundry  differing  in  many  respects  from  that  just 

described. 

Not  without  a  struggle  has  this  change  been  brought  about. 
Indeed,  scores  of  foundries  can  still  be  found  in  which  primitive 
methods  prevail  or  in  which  only  a  slight  advance  has  been  made.= 
This,  however,  is  not  peculiar  to  founding.  Nor  is  it  peculiar  that 
one  of  the  most  difficult  problems  developed  in  the  march  of  prog- 
ress has  arisen  from  the  attitude  of  the  workers  in  the  industry.    It 

IT.  D.  West,  quoted  in  Iron  Molders'  Journal,  1911,  P-  270;  1913.  PP-  iQ,  42. 

2  The  committee  on  foundry  methods  of  the  National  Founders'  Association 
estimated  in  1916  that  not  more  than  25  per  cent  of  the  foundries  of  North 
America  have  taken  advantage  of  the  available  mechanical  appliances  (N.  F.  A. 
Service  Bulletin  No.  i,  Chicago,  1916,*?.  3). 


436       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

is  natural  for  those  long  trained  to  a  skilled  trade  to  be  apprehensive 
of  the  rapid  and  unrestrained  introduction  of  those  forces  which  they 
fear  will  eventually  take  it  away  from  them.  So  it  has  been  in  the 
foundries.  As  one  mechanical  improvement  after  another  has  come, 
and  the  molders  have  seen  that  their  skill  was  becoming  of  ever 
lessening  importance  to  their  employers,  they  have  tried  to  ward  off 
disaster  in  such  ways  and  by  such  means  as  have  seemed  at  the 
time  expedient. 

The  Iron  ^Molders'  Union  has  naturally  taken  the  lead  in  protecting 
the  workers'  interests.  This  organization,  numbering  in  recent  years 
perhaps  fifty  thousand  members,'  is  one  of  the  oldest  of  the  existing 
trade-unions  and  is  known  to  be  one  of  the  best  managed,  most 
effectively  officered,  and  adequately  financed.  Its  local  branches,  of 
which  there  are  several  hundred,  decide  upon  its  national  rules  and 
elect  its  national  officers.  A  general  policy  once  formulated,  uni- 
form dues  and  benefits  once  established  through  convention  vote  or 
referendum,  it  is  the  national  officers'  duty  to  see  that  the  law  is 
carried  out. 

In  1899  the  Union  made  an  agreement  with  the  National  Founders' 
Association,^  composed  of  about  five  hundred  of  the  more  important 
employers  in  the  industry,  to  arbitrate  disputes  and  thus  do  away 
with  the  evil  effects  of  strikes  and  lockouts.  It  was  the  expectation 
of  each  organization  that  a  set  of  mutually  acceptable  working  rules 
would  soon  be  evolved  which  would  standardize  conditions  in  the 
trade  and  make  it  possible  to  legislate  annually  at  one  conference  on 
all  matters  related  to  wages  and  shop  practice.  These  standard  rules 
were  never  adopted,  however,  largely  because  of  the  fundamental  and 
unalterable  difference  of  opinion  between  the  two  sides  as  to  the 

1  Membership  of  the  Iron  Molders'  Union  is  very  difficult  to  estimate  because 
of  its  fluctuation  in  response  to  the  ebb  and  flow  of  industrial  prosperity.  The 
organization  itself  no  longer  makes  public  its  exact  numbers.  Since  1907  it 
has  been  represented  in  the  American  Federation  of  Labor  on  the  basis  of  a 
membership  of  approximately  50,000,  of  which  about  47,000  are  in  the  United 
States.  This  is  a  little  more  than  one  third  of  all  the  persons  in  the  trade  over 
which  it  claims  jurisdiction.  (Leo  Wolman,  "The  Extent  of  Labor  Organizations 
in  the  United  States/'  in  Quarterly  Journal  of  Economics,  Vol.  XXX  (1916), 
pp.  4S8,  489,  619.)  In  February,  191 7,  the  editor  of  the  Journal  made  some 
calculations  on  the  basis  of  a  50,000  membership  (Journal,  191 7,  p.  93). 

-'See  also  Chapter  XXVIII,  "The  National  Founders'  AssociaUon,"  pp.  406- 
432. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      437 

introduction  and  operation  of  machinery  and  the  development  of 

specialized  processes. 

Mechanical  devices  had  been  introduced  in  the  foundries  long 
before  the  Iron  Molders'  Union  and  the  National  Founders'  Asso- 
ciation adopted  their  arbitration  agreement.  Some  of  them,  such  as 
the  squeezer  (a  simple  appliance  for  packing, the  sand)  and  the  strip- 
ping plate  (for  helping  to  withdraw  the  pattern  without  breaking 
the  mold)  were  hand  tools  which  for  years  the  molders  had  used  as 
a  part  of  their  regular  equipment  with  no  idea  that  either  of  them 
constituted  a  special  kind  of  machine  over  which  there  should  be 
jurisdictional  disputes.^  How  unimportant  machines  were  prior  to 
1890  is  clearly  shown  by  the  small  number  of  pages  devoted  to 
descriptions  of  them  in  the  various  manuals  of  molding  published 

before  that  time. 

About  1890  the  first  Tabor  machine,  operated  by  power  and 
designed  to  ram  the  sand  by  a  method  far  superior  to  anything  then 
in  use,  was  put  on  the  market.  This  was  followed  by  machines  which 
drew  the  patterns,  then  by  others  which  combined  the  ramming  and 
pattern  drawing.  Some  of  the  power  machines  were  profitable  only 
when  hundreds  of  castings  from  the  same  pattern  were  to  be  made, 
but  others  could  be  used  to  advantage  for  a  lesser  number,  and  many 
were  adapted  to  fairly  complicated  work.  Bright  young  laborers 
who  had  never  been  trained  in  hand  molding  began  to  operate 
the  simpler  types  of  machines,  advancing  gradually  until  even  the 
most  difficult  patterns  were  made  under  their  supervision.  The 
brains  which  formerly  had  vested  in  the  molder  were  transferred 
entirely,  through  the  efforts  of  engineer  and  patternmaker,  to  the 

machine. 

The  heartiest  cooperation  was  met  with  from  the  men  who  were 
thus  given  an  opportunity  to  better  themselves.  They  were  more 
than  satisfied.  If  day  rates  were  paid,  their  wages  exceeded  those  of 
helpers  and  gangway  men.  On  piecework,  the  almost  universal 
method  of  paying  for  molds  made  on  the  machines,  they  could  double 
the  earnings  they  had  received  at  their  former  employment.  In  addi- 
tion, they  enjoyed  a  quite  definite  psychic  income  accruing  from  the 

IN.  E.  Spretson,  A  Practical  Treatise  on  Casting  and  Founding,  p.  234; 
E.  Treiber,  Foundry  Machinery  (translated  and  revised  from  the  German  by 
Charles  Salter),  p.  25. 


438       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

fact  that  they  were  now  mechanics— makers  of  castings,  instead  of 
mere  common  laborers.  They  were  strong,  they  were  used  to  hard 
work,  and  operating  the  machines  was  no  more  arduous  than  the 
tasks  to  which  they  had  been  accustomed. 

It  must  be  understood  that  molding  machines,  instead  of  being 
labor-saving  devices  in  the  sense  that  they  made  easier  the  work  of 
the  molder,  often  necessitated  a  material  increase  in  effort  by  the  man 
who  operated  them.  Though  time  was  actually  saved  in  making  any 
one  mold,  the  fact  that  more  molds  were  produced  meant  that  there 
was  more  sand  to  shovel,  more  molds  to  lift,  more  molds  to  pour, 
more  castings  to  shake  out.  That  is  to  say,  if  a  man  without  a 
machine  turned  out  six  castings,  but  thirty  with  it,  he  had  to  per- 
form all  the  preliminary  labor  necessary  to  making  twenty-four  addi- 
tional molds,  and  by  just  that  much  was  the  other  labor  incidental 
to  the  molding  process  increased.^  If  these  extra  operations  were 
performed  by  laborers  and  machinery,  as  has  more  recently  been  the 
case,  the  molding-machine  operator  became  himself  a  mere  machine, 
with  none  of  the  variety  to  his  work  which  characterized  the  skilled 
handworker. 

The  few  foundrymen  who  experimented  with  the  machines  were 
delighted  with  the  results.  Their  labor  cost  was  reduced  because  of 
the  use  of  laborers  at  wages  far  less  than  those  paid  to  journeymen, 
and  output  was  enormously  increased.  In  addition,  machine-drawn 
castings  were  found  to  be  more  uniformly  true  to  pattern,  which 
meant  less  grinding  and  machine-shop  work  and  therefore  easier  and 
less  expensive  finishing.  Machine-used  patterns  showed  less  wear 
and  tear  than  patterns  used  on  floor  or  bench.  And,  probably  more 
important  than  any  other  consideration  to  the  employer,  the  installa- 
tion of  molding  machines  lessened  his  dependence  on  journeymen 
mechanics.  Machines  having  been  invested  in,  the  working  force  in 
a  foundry  could  be  changed  with  but  little  inconvenience,  for  the 
skill  required  for  molding  was  still  present  in  the  wood  and  metal  of 
the  machines,  while  new  operators  were  easily  broken  in. 

lA  typical  case  is  that  of  a  certain  job  made  on  the  bench  and  paid  for  at 
the  rate  of  7  cents  per  flask.  Sixty  molds,  necessitating  10  ladles  of  iron,  paid 
$4-20.  Put  on  the  machine,  the  price  was  set  at  2.}4  cents  per  flask,  which  would 
mean,  for  the  same  daily  pay,  165  flasks  to  mold  and  28  ladles  of  iron  to  carry 
together  with  165  flasks  to  shake  out.  The  Journal  characterized  this  a^ 
"enough  labor  to  put  any  man  out  of  business."    ^Journal,  1907,  p.  215.) 


■I  I 
I 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      439 

Curiously  enough,  the  molders  paid  almost  no  attention  to  the  ma- 
chines during  the  early  stages  of  their  introduction  into  the  foundries. 
They  seem  to  have  been  entirely  indifferent,  as  if  nothing  had  oc- 
curred that  affected  their  trade  or  their  interests.  So  firmly  convinced 
were  they  that  no  harm  could  come  to  them  through  the  introduction 
of  machinery,  as  had  been  the  case  with  numerous  other  trades,  that 
they  scorned  all  offers  of  an  opportunity  to  operate  it.  They  believed 
molding  would  always  require  manual  dexterity  and  the  use  of  human 
intelligence  and  reasoning  power.    It  could  not  be  reduced  to  terms 

of  a  machine.^ 

Yet  the  use  of  molding  machines  steadily  increased.  By  1900 
nearly  10  per  cent  of  the  total  molding  force  employed  by  the  Na- 
tional Founders'  Association  were  machine  operators,  despite  the  fact 
that  62  per  cent  of  the  work  made  in  its  members'  foundries  was 
general  foundry  work,  engines,  and  machine  tools,  which  branches 
are  the  least  adapted  to  machine  molding.^ 

The  officers  of  the  Union  by  this  time  had  come  to  look  facts 
squarely  in  the  face.  They  saw  their  trade  slowly  slipping  into  the 
hands  of  laborers.  They  saw  perfect  castings  being  produced  with- 
out the  expenditure  of  any  particular  skill  upon  them.  And  they 
decided  that  the  Union's  policy  in  this  matter  must  be  changed,  that 
the  original  attitude  of  scorn  and  ridicule  had  been  a  grave  mistake, 
shortsighted  and  unprofitable.  It  had  not  prevented  the  introduction 
of  machines— machines  were  turning  out  molds;  and  if  the  Union 
did  not  now  control  them,  the  machines  would  soon  displace  the 
molders.^ 

lE.g.  Journal,  1896,  p.  65.  William  H.  Sylvis,  the  first  president  of  the 
Union,  in  trying  to  impress  upon  his  constituency  the  desirability  of  making 
the  trade  an  honored  occupation  through  maintaining  standards  of  skill,  said, 
''Our  trade  is  only  in  its  infancy  in  this  country  and  it  is  one  of  those  trades 
that  can  never  be  interfered  with  by  machinery,  for  the  reason  that  it  requires 
a  Lhinking   machine  to   make  castings"     (Proceedings,  Iron   Holders'   Union, 

1866,  p.  12). 

2  Data  furnished  by  the  secretary  of  the  Association  from  the  reports  ol 
members  for  the  last  quarter  of  1900.  This  estimate  does  not  include  core- 
makers.    See  also  Quarterly  Journal  of  Economics,  Vol.  XXX  (1916),  pp.  370, 

3  President's  address  to  the  convention  of  the  Iron  Holders'  Union,  1899 
(Proceedings,  I.H.U.,  1899,  PP-  10,  "i  Journal,  1899,  pp.  395-397).  See  also 
frequent  discussion  of  the  subject  in  subsequent  numbers  of  the  Journal,  and 
Proceedings,  I.  H.  U.,  1907)  PP-  9  2- 


i'ik^ 


1 


440      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Their  problem  was  the  twofold  one  of  guarding  against  future 
danger  and  of  repairing  the  damage  which  had  already  been  done. 
So  strongly  was  this  situation  emphasized  by  the  Union's  officers  at 
the  1899  convention  that  a  report  with  the  following  recommendations 
was  indorsed  unanimously : 

First,  that  the  future  policy  of  the  Union  should  be  to  seek  to 
establish  jurisdiction  over  the  molding-machine  operator  and  all  those 
who  work  in  the  various  subdivisions  of  the  trade  of  molding  ;  second, 
that  they  advise  and  instruct  their  members  to  accept  jobs  on  molding 
machines  and  to  endeavor  to  bring  out  their  best  possibilities  ;  third, 
that  the  officers  of  the  organization  ask  the  cooperation  of  the  foundry- 
men  in  forwarding  the  plan,  and  in  other  ways  seek  to  devise  means 
of  putting  the  new  policy  into  effect.' 

This  complete  change  of  front  was  made  by  a  representative  con- 
vention of  the  Iron  Molders'  Union,  but  in  attempting  to  carry  it 
out  there  developed  a  very  difficult  situation.  The  habit  of  indiffer- 
ence had  been  too  long  ingrained  in  the  rank  and  file.  They  refused 
to  operate  the  machines  and  bitterly  opposed  the  change.-  Foundry- 
men,  on  their  part^  had  become  accustomed  to  laborers  at  the  ma- 
chines, found  them  entirely  satisfactory,  and  were  loath  to  allow  the 
molders  an  opportunity  to  demonstrate  their  own  superiority.  But 
when  these  obstacles  had  been  overcome,  and  the  members  of  the 
Union  finally  took  their  places  at  the  machines,  unsatisfactory  results 
almost  always  followed.  The  output  was  not  nearly  as  great  as  the 
employer  thought  it  should  be  ;  the  machines  manifested  a  persistent 
tendency  to  get  out  of  order.  The  journeymen,  after  a  few  days' 
trial,  were  always  wanting  to  return  to  handwork.  In  addition,  they 
expected  to  receive  the  pay  which  had  been  theirs  as  hand  molders. 
The  upshot  of  the  matter  usually  was  that  after  thousands  of  dollars 
had  been  invested  in  machines,  in  a  few  weeks  they  were  relegated 
to  the  shed  or  the  yard  and  no  more  attempts  were  made  in  that 
particular  foundry  to  carry  on  machine  molding.'*  Or,  if  the  employer 
persisted  in  his  use  of  the  machines  and  returned  to  laborers  as 
operators,  they  were  promptly  taken  into  the  Union  and  the  Union 

1  Proceedings,  I.  M.U.,  1899,  PP-  75»  loi,  112,  165,  166;  Journal,  1899,  p.  397. 

2 E.g.,  letter  in  the  Journal,  1899,  pp.  412,  413. 

^Journal,  1903,  pp.  11-14.  See  also  United  States  Commission  on  Industrial 
Relations,  Hearings  at  Washington,  D.  C,  Tuesday,  April  7,  1914  (MS.),  Vol.  I, 
p.  256;  Vol.  II,  pp.  581-588,  615. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      441 

proceeded  to  help  them  secure  "a  wage  commensurate  with  their 

output  and  skill." ^ 

There  is  no  doubt  that  many  skilled  molders,  put  to  work  on  the 
machines,  did  not  honestly  try  to  bring  out  their  best  possibilities. 
On  the  other  hand,  even  when  they  did,  results  were  not  satisfactory. 
For  instance,  one  foundryman  reported  that  he  had  five  molding 
machines  operated  by  molders  and  two  by  laborers,  and  in  each  case 
the  class  of  work  was  identical.  The  molders  on  their  machines 
turned  out  from  75  to  100  molds  a  day  ;  the  laborers  made  from  175 
to  200.-  Another  employer  had  sixty-seven  machines.  On  sixty-two 
small  work  was  made  and  laborers  were  entirely  satisfactory.  On 
the  five  machines  making  the  larger  molds  they  lost  about  50  per 
cent  of  the  castings  and  could  not  seem  to  get  the  knack  of  the 
process.  When  journeymen  were  pul  on  there  was  no  loss  from  im- 
perfect work,  and,  furthermore,  the  output  was  increased.  It  was 
distinctly  understood,  however,  that  the  molders  were  to  leave  the 
smaller  machines  entirely  alone.^ 

There  are  several  obvious  reasons  for  the  employers'  lack  of  satis- 
faction with  journeymen  on  the  machines.  In  the  first  place,  the 
position  of  the  Union  was  that  its  members  as  well  as  the  manu- 
facturers should  benefit  by  whatever  improvements  were  introduced. 
Thus,  if  payment  was  by  the  piece,  the  same  rate  should  prevail  for 
machine  as  for  hand-molded  castings.  Or,  if  the  day-rate  method 
was  used,  as  the  Union  at  that  time  greatly  preferred,  there  was,  it 
was  thought,  no  justification  for  the  employer's  insistence  upon  a 
lower  wage  rate  because  the  molding  was  now  done  on  machines  in- 
stead of  by  hand.  No  reason  has  ever  appeared  to  the  Union  why  its 
members  should  work  harder  or  receive  a  lower  proportional  rate  on 
the  machines  than  at  hand  molding.*  The  value  of  the  machines  to 
the  manufacturer  is  largely  determined  by  the  amount  of  labor  and 
skill  they  eliminate  from  the  molding  process. 

Again,  skilled  molders  had  not  been  trained  to  the  heavier  work 
made  necessary  by  the  machines  ;  their  apprenticeship  had  been 
served  to  brain  and  not  to  brawn.    It  was  inevitable  that  their 

1  Proceedings,  I.  M.U.,  1902,  p.  617. 

-Report  of  the  Officers,  N.  F.  A.,  November,  1902,  p.  50. 

3  Proceedings,  N.  F.  A.,  November,  1901   (MS.),  pp. 93-100. 

4  Hearings  (MS.),  Vol.  I,  p.  314- 


442       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

output  should  be  inferior  to  that  of  men  whose  work  on  the  machines 
was  easier  than  that  to  which  they  had  been  accustomed ;  who,  far 
from  having  any  prejudice  against  it,  since  they  had  never  known  any 
other  method  of  molding,  were  enthusiastic  over  its  use  and  felt  their 
best  interest  to  be  akin  to  that  of  their  employers  in  getting  the  most 
out  of  the  machines.^ 

Journeymen  had  everything  to  lose  by  the  introduction  of  ma- 
chinery,—their  trade,  their  skill,  and  their  pay,— with  much  harder 
work  in  the  bargain.  Indifference  on  the  part  of  many  developed  into 
active  opposition,  as  employers,  trade  papers,  and  molding-machine 
manufacturers  constantly  set  before  them  the  possibility  that  in  the 
near  future  the  new  inventions  were  so  to  supplant  the  skilled  me- 
chanics that  they  would  soon  be  superfluous  encumbrances  in  the 
foundries. 

At  first  foundrymen  were  willing  to  let  union  molders  take  a  turn 
at  the  machines  if  they  so  desired.  They  never  for  a  moment  re- 
garded it  as  the  molder's  right,  however,  and  of  course  expected  that 
a  much  larger  output  would  result  than  had  been  possible  under  the 
old  hand  process.    When  they  found  that  journeymen  would  never 

^"The  reasons  for  the  journeyman  molder's  not  producing  a  maximum  output 
on  the  machine  are  two :  first,  Union  affiliation  undoubtedly  has  created  in  the 
mind  a  dislike  for  and  prejudice  against  the  machines  ;  second,  he  lacks  a 
positive  incentive  to  operate  the  machines  to  the  best  advantage.  He  antici- 
pates no  increase  in  his  earning  power  —  the  reward  is  negative.  The  laborer 
is  promised  a  large  increase  in  his  earning  capacity  if  he  gets  the  most  out  of 
the  machine;  the  journeyman  molder  is  promised  employment  at  a  less  remun- 
erative work  or  no  work  at  all  if.  he  does  not  operate  the  machine  to  its  full 
capacity. 

"  For  the  reasons  stated  above,  it  is  doubtful  whether  a  nonunion  journeyman 
would  make  a  better  success  as  a  machine  operator  than  a  union  journeyman. 
The  fundamental  problem  is  one  dealing  with  human  nature  perhaps  as  much  as 
with  union  labor.  Any  journeyman  has  through  long  years  become  so  accus- 
tomed to  certain  fixed  standards  of  a  day's  work  that  he  finds  it  difficult  to 
adjust  himself  against  all  inclination  and  active  prejudice  to  new  standards  of 
output  largely  exceeding  the  old.  Inquiry  in  nonunion  shops  where  both  floor 
and  machine  molders  are  employed  develops  the  fact  that  it  is  difficult,  even 
thus  when  not  encountering  union  prejudice  against  the  machine,  to  get  a  man 
accustomed  to  floor  or  bench  work  to  put  up  a  full  day's  work  on  the  machine." 
(Stove  Founders'  National  Defense  Association,  Report  of  the  Committee  on 
Machinery,  iqo8,  pp.  13,  14.)  See  also  Proceedings,  N.  F.  A.,  November,  1905, 
m  the  Review,  December,  1905,  p.  43;  ibid.  February,  1910,  p.  6;  United  States 
Bureau  of  Labor,  Bulletin  No.  67  (1906),  "Conditions  of  Entrance  to  the 
Principal  Trades,"  p.  714. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      443 

go  on  machines  if  there  were  handwork  to  be  done,  that  there  was 
very  little  if  any  increase  in  output,  and  that  the  same  rate  was 
demanded  for  machine  as  for  hand  molding,  they  ignored  the  Union 
entirely  and  went  back  to  the  system  of  freely  employing  unskilled 
men  on  the  machines. 

Only  a  few  months  after  the  Union  had  voted  to  cooperate  with 
the  manufacturers  in  the  introduction  of  machinery,  though  after  a 
long  enough  time  had  elapsed  to  demonstrate  that  the  interests  of 
employer  and  union  employee  were  essentially  divergent,  the  National 
Founders'  Association  adopted  a  resolution  that  they  would  use 
their  own  judgment  as  to  who  should  operate  the  machines ;  that 
when  it  seemed  skilled  molders  would  do  the  best  work,  as  was  some- 
times the  case,  they  would  be  employed,  but  that  the  whole  thing 
was  a  matter  of  shop  practice  quite  outside  the  scope  of  any  arbitra- 
tion agreement,  and  that  "molding-machine  operators  should  not  be 
considered  molders  in  any  agreement  entered  into.  •  •  -"^ 

It  seems  evident  that  whereas  in  the  beginning  the  Association  did 
not  conceive  of  the  Union's  machine  policy  as  one  designed  to  limit 
output,  a  few  months'  experience  caused  a  reversal  of  judgment." 
Members  believed  they  must  be  free  to  use  the  machines  as  they 
pleased ;  the  high  minimum  wage  demanded  by  journeymen,  com- 
bined with  their  great  scarcity  during  the  period  of  business  activity 
which  characterized  the  years  from  1899  to  1903,  made  necessary 
the  introduction  of  whatever  practices  would  make  for  less  depend- 
ence on  that  class  of  labor.^  Desirable  members  were  being  lost  to 
the  Association  because  they  feared  negotiation  with  the  Union 
would   deprive   them   of   their   prevailing   or   contemplated   use   of 

machines.* 

It  will  be  easily  understood  that  the  Association's  arbitrary  re- 
moval of  the  machine  issue  from  the  purview  of  their  joint  agreement, 
just  after  the  Union  had  voted  to  enlist  the  Association's  cooperation 
in  working  out  a  mutually  acceptable  policy,  met  with  vigorous 
opposition  from  the  Union.   The  first  clash  came  at  the  now  famous 

< 

1  Proceedings,  N.  F.  A.,  February,  1900,  p.  35. 
2/rf.  August,  189Q;  February,  1900,  p.  39. 

3  Proceedings,  Conference  between  the  National  Founders'  .\ssociation  and 
the  Iron  Molders'  Union  of  North  America,  Detroit,  October,  1902  (MS.),  p.  14. 

4  Proceedings,  N.  F.  A.,  February,  1900,  p.  38. 


r 


m' 


444       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Detroit  conference  of  June,    1900.    Said   the  National   Founders' 
Association : 

Inasmuch  as  the  molding  machine  is  the  product  of  the  machine 
shop  and  not  of  the  foundry,  it  is  not  under  the  jurisdiction  of  the 
molder,  but  having  been  produced  at  the  expense  of  the  employer, 
there  shall  be  accorded  to  him  the  right  to  operate  it  in  whatever 
manner  he  may  elect,  the  same  as  his  right  to  operate  his  power 
plant,  cranes,  or  any  other  mechanical  devices  which  have  been 
brought  into  the  foundry  for  the  better  prosecution  of  the  employer's 
and  molder's  joint  interest/ 

The  Molders'  counter  proposition  was : 

That  inasmuch  as  the  molding  machine  is  but  an  improved  tool 
designed  to  increase  and  cheapen  the  product  of  the  molder  and 
represents  both  additional  capital  invested  by  the  foundryman  in 
his  business  and  a  different  method  of  applying  and  utilizing  the 
capital  (his  labor)  of  the  molder,  we  recognize  that  each  is  mutually 
interested  in  the  manner  of  its  operation.- 

The  Detroit  conference  ended  in  a  deadlock  and  was  soon  followed 
by  one  of  the  most  bitter  strikes  in  the  history  of  the  industry.  The 
settlement  of  this,  after  more  than  seven  months  of  struggle,  served 
only  to  confuse  the  machine  issue.  Among  other  things  it  was 
stipulated : 

That  the  right  of  the  foundryman  to  introduce  or  operate  molding 
machines  in  his  foundry  shall  not  be  questioned.  In  determining  who 
shall  operate  them  regard  should  be  given  to  the  question  of  how 
their  best  possibilities  can  be  brought  out  and  how  the  work  can 
be  most  economically  produced.'^ 

But  it  was  also  agreed  that  in  applying  the  principle  of  the  mini- 
mum wage  "operators  of  molding  machines  who  have  not  learned 
the  general  trade  of  molding"  were  not  to  be  considered.*  This  was 
regarded  by  both  officers  and  men  of  the  Union  as  strictly  in  accord 
with  the  ruling  of  their  recent  convention  and  as  in  no  wise  relin- 
quishing their  interest  in  the  machine  question.-'    Members  of  the 

^^Proceedings,  Conference,  Detroit,  June,  1900  (MS.) ;  Journal.igoo,  pp.384-382. 
-Ibid.  ** 

^Proceedings,  Conference,  Cleveland,  February,  iqoi  (MS.);  Journal  igoi 
PP-  133-135-  '  ' 

*  Proceedings,  Conference,  Cleveland,  February,  iqoi  (MS.);  Journal,  1901 
pp.  130,  131,  196,  197.  '  ' 

•Proceedings,  Conference,  Cleveland,  June,  1901  (MS.) ;  Journal,  igoi.p  403 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      445 

Association,  on  their  part,  interpreted  it  as  a  surrender  to  their 
point  of  view  and  tried  to  use  it  as  a  precedent  for  introducmg  and 
operating  machines  at  will  without  consulting  the  Union  at  all.^  As 
a  result  the  Union  became  more  seriously  concerned  than  before  over 
the  machine  issue  and  found  it  necessary  to  repudiate  on  every 
occasion  this  statement  of  their  machine  policy. 

The  Association's  attempt  to  remove  the  molding-machine  issue 
from  joint  control  with  the  Union  was  only  slightly  successful  dunng 
the  years  1899  to  IQ03.  With  business  booming  and  a  larger  pro- 
portion of  molders  in  the  Union  than  ever  before,  employers  had 
little  choice  as  to  their  machine  policy.  While  it  is  true  that  the 
national  union  showed  no  tendency  to  support  a  subordinate  group 
in  its  opposition  to  the  introduction  of  machines,  help  was  frequently 
given  when  locals  were  trying  to  persuade  foundrymen  to  allow  their 
members  to  show  what  they  could  do.  Some  of  the  local  contracts 
of  the  time  are  interesting  as  an  indication  of  the  expedients  resorted 
to  for  the  purpose  of  harmonizing  conflicting  opinions. 

One  way  of  getting  around  the  difficulty  was  to  call  the  unskilled 
nonunion  machine  operators  apprentices,  even  though,  because  of  the 
prevalence  of  a  fixed  ratio  in  some  foundries,  this  necessarily  reduced 
the  number  of  legitimate  learners  of  the  trade.^    In  another  instance 

1  Report  of  the  President,  N.  F.  A.,  May,  1901  (MS.),  pp.  S,  6;  Proceedings, 
N.F.A.,  May,  1901  (MS.),  pp.  80-85,  91. 

2  An  agreement  signed  in  July,  1901,  illustrates  this: 

"Whereas  .  .  it  appears  that  this  employment  of  a  laborer  on  the  moldmg 
machines  has  given  rise  to  some  irritation  in  the  shop  of  the  — -  Co.,  through 
a  misunderstanding  on  the  part  of  the  molders,  and  also  the  further  claim  on 
the  part  of  the  Iron  Molders'  Union  of  North  America  that  the  question  ot 
the  use  of  molding  machines  by  inexpert  labor  had  not  been  definitely  settled 
between  the  National  Founders'  Association  and  the  Iron  Molders  Union  of 
North  America,  at  the  solicitation  of  Mr.  Valentine,  first  vice  president  of  the 

Iron  Molders'  Union  of  North  America,  that  the Co.  remove  the  machine 

or  the  laborer  working  thereon  in  order  to  allay  any  feeling  that  its  use  may 

have  engendered  in  the  shop  of  the  company,  the  Co.  has  consented  to 

call  the  laborer  engaged  on  the  machine  an  apprentice  and  to  accept  him  as 
such,  and  under  this  name  to  operate  the  machine  for  the  present  The  — — 
Co.  agree  to  make  this  change  solely  in  the  interest  of  peace,  and  under  the 
special  condition  that  none  of  their  rights  to  operate  molding  machmes  m  their 
foundries  by  inexpert  labor  or  machine  operators  are  thereby  waived  or  re- 
linquished or  forfeited  in  any  manner.  And  furthermore,  it  shall  not  be  used 
as  a  precedent  in  any  future  conference  or  settlement  of  the  question.  (Agree- 
ments with  Foundrymen,  1901,  I,  M.  U.  Miscellaneous  Records  (MS.).) 


446       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

an  arrangement  was  made  whereby  molders  were  to  run  machines 
w^ith  flasks  more  than  twenty-four  inches  square  or  with  an  area 
exceeding  24"x  24",  while  laborers  or  unskilled  molders  were  to  work 
on  machines  with  flasks  less  than  that  size.''  Still  others  required 
that  molders  be  given  first  choice  as  machine  operators,  and  pro- 
vided for  joint  determination  of  the  piece  or  time  rate.^  All  of  these 
makeshifts  were  obviously  unsatisfactory  so  long  as  no  generally 
acceptable  policy  had  been  agreed  upon.  The  persistent  demands 
of  the  Union  for  a  voice  in  the  determination  of  a  matter  the  Asso- 
ciation considered  beyond  its  power  was  a  source  of  continual  griev- 
ance to  the  latter  ;  the  Union  was  confessedly  panicky  over  the  fate 
of  the  trade. 

In  1902  the  national  union,  having  failed  to  persuade  the  locals 
to  help  enthusiastically  in  the  development  of  the  machines  by 
operating  them  fairly  and  bringing  out  their  best  possibilities  as 
determined  in  the  resolution  of  1899,  i^ot  entirely  comprehending 
the  Association's  position  in  the  matter,  yet  realizing  that  larger  and 
larger  groups  of  unskilled  men  were  daily  turning  out  satisfactory 
castings  on  the  machines,  resolved  to  extend  the  organization  to  these 
men.  The  experiment  of  forming  a  special  local  of  machine  opera- 
tors had  been  tried  in  the  autumn  of  1901  and  met  with  such  success 
that  their  wages  were  raised  and  conditions  generally  were  bettered. 
They  were  represented  at  the  convention  of  1902.^  On  the  basis  of 
this  trial  and  because  of  the  Union's  urgent  need  to  get  control  of  the 
machine  operators,  who  otherwise  seemed  in  a  fair  way  to  walk  off 
with  the  trade  entirely,  the  1902  convention  amended  the  Union's 
admission  requirements  so  as  to  include  any  molder  who  had  served 
an  apprenticeship  of  four  years  or  worked  at  the  trade  four  years 
"in  any  of  its  branches  or  subdivisions."'*  The  executive  board  later 
decided  not  to  grant  an  active  card  to  machine  operators  until  they 

1  Report  of  the  Officers,  N.  F.A.,  November,  1902,  p.  50. 

-Agreement  between  Unions  Nos.  19  and  24  and  the  Henry  McShane  Mfg. 
Co.,  December  31,  1902  (MS.)  ;  Agreement  between  the  National  Founders' 
Association  of  Pittsburgh  and  the  Iron  Molders'  Union  of  Pittsburgh  and 
Vicinity,  no  date  (MS.) ;  Agreement  between  the  Gould  Coupler  Co.,  Depew, 
N.  Y.,  and  the  Iron  Molders'  Conference  Board  of  Buffalo  and  Vicinity, 
January  i,  1902  (MS.). 

•'Proceedings,  I.M.U.,  1902,  p.  617;  Journal,  1902,  p.  403. 

4  Proceedings,  I.  M.  U.,  1902,  p.  754;  Constitution,  I.  M.  U.,  adopted  1902, 
Article  VIII,  Section  i;  Journal,  1902,  pp.  531,  532. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      447 

had  served  their  full  time.^    But  even  with  this  special  member- 
ship  they   were   regarded   as   an   integral   part   of    the   Union   in 

every  way. 

From  then  on,  the  organization  of  machine  operators  progressed 
rapidly  and  made  increasingly  trying  the  relations  between  the  Union 
and  the  Association.  Each  subsequent  attempt  to  reach  a  uniform 
agreement  on  the  machine  matter— and  there  were  many — only 
ended  in  a  deadlock,  for  neither  side  receded  from  its  original  position 
in  the  least.  Just  as  it  appeared  that  the  interests  of  the  two  organ- 
izations were  so  antagonistic  as  to  make  any  reconciliation  out  of  the 
question  entirely,  the  industrial  tide  turned,  the  panic  of  1903  was 
reflected  almost  at  once  in  a  lessened  demand  for  molders,  and  the 
Association  lost  no  time  in  taking  advantage  of  this  situation  to 
release  themselves  from  a  situation  they  had  come  to  find  intolerable. 
The  arbitration  agreement  of  1899  was  abrogated  by  the  Association 
in  1904,  and  since  then  no  negotiations  whatever  have  been  held 
between  the  two  parties  to  the  original  contract. 

From  this  brief  account  of  the  struggle  of  the  Iron  Molders'  Union 
and  the  National  Founders'  Association  over  the  introduction  and 
operation  of  molding  machines,  it  must  appear  that  one  fundamental 
issue,  and  only  one,  was  involved  on  each  side.    There  was  in  the 
policy  of  the  national  union,  no  matter  what  the  attitude  of  the  rank 
and  file,  no  hostility  to  the  machines.    Its  officers  were  agreed  with 
the  National  Founders'  Association  that  machines  should  be  used. 
They  were  equally  concerned  to  say  when  and  under  what  circum- 
stances.   The  Association  was  insistent  in  its  support  of  those  mem- 
bers who  considered  it  their  privilege  to  introduce  machines  at  will. 
The  Union  was  organized  to  protect  its  members  in  the  sale  of  their 
labor,  and  this  meant  that  they  must  control  the  ways  in  which  the 
molding  process  was  carried  on.    The  Association,  in  order  to  enable 
its  members  to  attain  the  greatest  efficiency  in  their  business,  had  to 
guarantee  them  its  absolute  control  in  their  own  hands.    The  two 
theories  are  so  irreconcilable  that  it  seems  doubtful  if  any  satisfactory 
permanent  arrangement  could  ever  have  been  reached,  even  with  the 
complete  cooperation  of  the  local  unions,  which  apparently  was  not 
given  during  the  period  in  which  attempts  were  being  made  to  bring 
this  about. 

1  Proceedings,  I.M.  U.,  1907,  P-  28. 


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448       TRADE  UXIONISIVI  AND  LABOR  PROBLEMS 

One  factor  not  generally  understood  is  worthy  of  emphasis  in  this 
connection.  Almost  from  the  bej];inning  of  the  industry  it  has  been 
the  custom  of  the  trade  to  recognize  a  "set  day's  work."  When  a 
pattern  came  into  the  shop  a  few  pieces  were  made  from  it,  and  the 
foreman  then  fixed  the  time  that  normally  would  be  required  to  make 
similar  castings  in  the  future.  From  then  on,  each  man  making 
pieces  from  that  pattern  was  supposed  to  conform  to  the  established 
"set."  WTien  the  Iron  Molders'  Union  came  to  be  important  in  the 
foundries  the  amount  of  the  task,  or  "set,"  became  the  subject  of 
agreement  between  the  shop  committee  and  the  foreman,  but  this  was 
obviously  only  a  formal  recognition  of  what  had  always  been  a  legiti- 
mate practice  of  the  trade. ^  Thus  the  handworker  had,  through 
long  years'  practice,  become  accustomed  to  turn  out  so  much  and  no 
more  as  a  day's  work.  It  is  entirely  possible,  indeed  quite  likely, 
that  journeymen  trained  to  the  hand  trade  and  its  speed  could  never 
adapt  themselves  with  entire  satisfaction  to  the  machine  process ; 
that  for  most  of  the  molding-machine  work  unskilled  men  who  had 
never  had  any  other  experience,  who  had  no  prejudices  to  live  down 
or  trade  tricks  to  unlearn,  would  make  the  more  successful  machine 
operators. 

After  relations  between  the  Iron  :\Iolders'  Union  and  the  National 
Founders'  Association  were  broken  off  in  1904,  members  of  the  latter 
continued  to  use  molding  machines  with  entirely  satisfactory  results. 
Output  w^as  increased,  and  thousands  of  dollars  were  annually  saved 
to  those  who  persisted  in  using  and  experimenting  with  the  various 
t3^es  and  combinations  of  appliances  available.-  Some  of  the  achieve- 
ments are  interesting  and  suggestive.  A  report  written  in  the  spring 
of  1905,  about  a  year  after  a  very  hard  and  bitter  strike  had  been 
initiated  in  three  large  heater  shops,  notes  the  following :  one  foundry 
employing  forty  men  at  molding  had  only  five  journeymen ;  another 
had  two  journeymen  out  of  twenty-eight ;  and  the  third  had  fifteen 
out  of  a  molding  force  of  one  hundred  and  ten.    All  three  firms  were 

1  United  States  Bureau  of  Labor,  Eleventh  Special  Report  of  the  Commis- 
sioner, 1904,  "Regulation  and  Restriction  of  Output,"  pp.  149,  150;  David  A. 
McCabe,  The  Standard  Rate  in  American  Trade  Unions,  p.  no;  Proceedings, 
Conference,  Detroit,  October,  1002   (MS.),  pp.  22,  74. 

^The  Review,  October,  1905;  Proceedings,  N.  F.  A.,  November,  1905,  in  the 
Review,  December,  1905,  pp.  44,  46,  47;  N.  F.  A.,  Plain  Talk  Pamphlets  No.  2, 
p.  5- 


li 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      449 

using  molding  machines  and  had  contracted  for  the  delivery  of  more. 
1  he  operators  were  Poles  and  Italians,  many  of  whom  could  not  speak 
English  and  who  had  never  worked  at  molding  before.  The  day  rate 
was  $1.50  to  Si. 75.  At  piece  prices  (the  method  of  paying  about 
half  the  force)  from  S2  to  S3  was  paid,  with  more  earning  in  the 
neighborhood  of  S2  than  S3.  While  this  was  in  excess  of  any  pay 
the  men  had  received  before  they  took  up  molding,  the  saving  to 
the  manufacturer  was  considerable.^  In  these  same  foundries  the 
average  cost  per  ton  for  furnace  molding  had  been  S20.50  before 
the  strike;  a  year  later  it  was  S16.25.  When  all  the  machines 
which  had  been  contracted  for  were  installed,  it  was  expected  the 
cost  would  be  reduced  to  about  S14  per  ton.^ 

This  same  report  notes  operations  at  a  certain  pipe  foundry.  One 
Pole  was  putting  up  16  molds  per  hour,  size  16"  X  19",  from  a 
pattern  made  for  6  pieces  of  one-and-one-half-inch  steam-pipe 
fittings,  requiring  six  cores  in  each  mold.  The  man  worked  nine 
hours  continuously  at  molding  and  netted  144  molds  in  that  time. 
This  represented  864  pieces  of  cored  castings  weighing  875  pounds. 
He  was  paid  i>4  cents  per  mold,  or  a  daily  wage  of  S2.16.    Other 

iThe  following  table  of  rates  (from  the  Minutes  of  the  Administrative  Coun- 
cil N.  F.  A.,  August  7,  1905  (MS.))  compares  prices  paid  before  machines 
were  introduced  and  the  machine-molding  price:  Former    Subsequent 

Price  Price 

Base  ring ^'2>^  ^°-25 

Base  ring 55  -^7 

No.  36  upper  deck  .          34  -^o 

No.  40  upper  deck 4^  .22 

No.  44  upper  deck "°  -^S 

No.  36  lower  deck 1>7  20 

No.  40  lower  deck 47  -22 

No.  44  lower  deck ^^  -28 

No.  36  upper  fire-pot 26.V  .11 

No.  40  upper  fire-pot 33i  -^^ 

No.  36  lower  fire-pot -4  -^^ 

No.  40  lower  fire-pot 29  .11 

No.  36  shaking-bar  grate o^i  ^°^>l 

No.  40  shaking-bar  grate 09.J  -04^ 

No.  40  short  grates °8  .04 

Feed  doors °9J  -04^ 

Clean-out  doors °55  -02^ 

Clean-out  cellar °6  .03 

Water  pan ^4^  -o? 

Water-pan  frame °5-^  '°^^ 

2 Minutes  of  the  Administrative   Council,  N.  F.  A.,   August    7,   IQOS    (MS.). 


450       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


men  were  said  to  be  turning  out  42  pieces  of  soil  pipe,  five  feet  long 
and  four  inches  inside  diameter.  The  comment  was  that  no  living 
molder  could  put  up  over  half  of  these  jobs  by  ordinary  molding 
methods.^ 

In  addition  to  small  and  purely  repetitive  work  Association  mem- 
bers have  come  to  make  heavy  and  intricate  castings  on  molding 
machines.  The  patterns  thus  mounted  may  be  changed  from  four  to 
ten  times  a  day.^  With  a  proper  adjustment  of  patterns  and  flasks 
almost  any  mold  can  be  made  on  some  type  of  rnachine.''  Indeed, 
the  only  limit  seems  to  be  imposed  by  the  size  of  the  machine  itself.'* 
The  commissioner  of  the  Association  cites  a  number  of  instances  of 
large  and  complicated  molds  handled  in  this  way.  A  gas-engine  bed 
with  a  flask  fourteen  feet  long,  six  feet  wide  and  four  feet  deep, 
weighing  with  sand,  pattern,  and  board  nearly  30,000  pounds,  was 
made  on  a  machine  by  one  handyman  and  one  helper  in  eighteen 
hours,  where  the  previous  method  had  taken  the  time  of  one  molder 
and  one  helper  for  five  days.  The  finished  casting  from  this  mold 
weighed  11,920  pounds  and  had  the  additional  advantage  of  being 
1000  pounds  lighter  than  it  would  have  been  had  it  been  made 
according  to  the  old  method.^ 

Further  examples  might  be  produced  to  show  the  use  of  molding 
machines  for  this  and  similar  work.''  But  it  is  important  to  note  other 
items.  In  some  cases  no  alteration  whatever  in  the  pattern  is  neces- 
sar\'  in  transferring  from  hand  to  machine  molding  ;  in  others  ma- 
chines can  be  used  only  because  of  the  expert  engineering  skill  that 
has  gone  into  the  making  of  the  patterns.'  For  some  castings,  such 
for  instance  as  heavy  machinery,  part  of  the  molding  work  may  be 
done  on  the  machines  and  part  by  skilled  molders  on  the  floor  or  the 

1  Minutes  of  the  Administrative  Council,  N.  F.  A.,  August  7,  1905  (MS.). 

2  Report  of  the  Commissioner,  N.  F.  A.,  November,  1908,  in  the  Review^ 
December,  1908,  p.  33. 

'•^Id.  November,  loio,  in  the  Review,  December,  1910,  pp.  29,  30. 

^Id,  November,  191 1,  in  the  Review,  December,  191 1,  p.  28;  The  Review^ 
January,  1910,  p.  33. 

^Ibid.  September,  1909,  pp.  11-13;  January,  1910,  p.  76. 

^'See  the  Review,  October,  1909,  p.  29;  January,  1910,  pp.  29,  30.  Many 
numbers  of  such  papers  as  the  Foundry,  the  Iron  Trade  Review,  the  Iron 
Age,  contain  articles  describing  the  achievements  of  machines  and  mechanical 
devices  of  all  sorts. 

'The  Review,  October,  1909,  p.  29;  January,  1910,  pp.  71,  79. 


I 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      4Si 

bench.^  Again,  machines  for  molding  some  specialties  have  been 
made  absolutely  automatic.  They  require  no  human  labor  whatever 
save  for  setting  the  cores,  pouring  the  metal,  and  shaking  out  the 
castings.^ 

With  adequate  machinery  it  takes  but  little  time  nowadays  to 
transform  a  common  laborer  into  a  first-class  machine  molder.  At 
first  it  is  probable  that  a  considerable  amount  of  bad  work  was  pro- 
duced on  the  machines.  For  a  long  time  the  Union  made  a  great 
deal  of  this  point  and  claimed  that  the  discount  for  bad  work  often 
ran  from  30  to  50  per  cent.^  With  proper  machines  and  instruction, 
however,  it  has  been  found  that  in  from  three  to  six  weeks  an  em- 
ployer can  safely  intrust  much  to  a  machine  operator,  and  in  a  few 
months  nothing  a  machine  can  handle  is  beyond  the  powers  of 
the  operators.* 

The  advantages  to  foundrymen  of  introducing  molding  machines 
may  be  summarized,  then,  from  their  point  of  view,  as  freedom  from 
dependence  upon  skilled  labor,  and  especially  from  negotiations  with 
the  Union,  which  had  been  characteristic  of  the  trade  when  the  labor 
of  its  members  was  an  absolute  necessity ;  more  accurate  molds  and 
longer-lived  patterns ;  ^  lighter  castings ;  an  increased  output  varying 
from  double  to  forty  times  the  production  under  the  hand  system ;  ^ 
and  a  decreased  cost  of  production,  amounting  in  some  cases  to 
75  per  cent.'' 

More  progress  was  made  in  introducing  efficiency  methods  and 
output-increasing  devices  in  the  five  years  immediately  following  the 

1  The  Review,  January,  1910,  pp.  44  ff. 

2  See,  for  example,  a  description  of  the  continuous  process  in  making  radiators, 
in  the  Foundry,  Vol.  XL  (1912),  pp.  i-S- 

3  Minutes  of  the  Administrative  Council,  N.  F.A.,  August  7,  1905  (MS.); 
Journal,  1907,  and  succeeding  years. 

4  Probably  the  following  account  is  typical : 

".  .  .  The  best  trick  they  have  done  so  far  is  to  jar  a  24-inch  cylinder. 
They  reduced  the  molding  time  on  this  from  seven  to  four  days.  You  would 
be  surprised  to  see  green  men  handling  is-ton  wheels  and  33-inch  beds.  This 
bed  plate  under  the  old  system,  with  the  Union,  was  a  sLx-day  job,  and  under 
the  new  system  they  have  just  completed  nine  of  them  in  twenty  days.  The 
first  one  cost  them  four  days,  and  they  cast  one  every  two  days  thereafter." 
{The  Review,  June,  1909,  pp.  i9>  20.) 

^Ibid.  June  1910,  p.  33. 

« Hearings  (MS.),  Vol.  I,  pp.  255,  256. 

"^  The  Review,  October,  1909,  p.  29. 


\ 


452       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

break  between  the  National  Founders'  Association  and  the  Iron 
Molders'  Union  than  in  the  twenty-five  years  preceding.^  While  a 
number  of  circumstances  contributed  to  bring  this  about,  undoubtedly 
the  most  important  single  factor  was  the  prevalence  of  labor  troubles 
and  the  activity  of  the  Union. 

The  strikes  of  1903  and  1904,  instituted  by  the  Union  to  resist 
the  changes  in  wages  and  conditions  which  the  foundrymen  under- 
took to  introduce  the  moment  the  industrial  situation  was  favorable, 
resulted  in  a  number  of  firms'  breaking  away  from  collective  agree- 
ments entirely.  This  they  were  enabled  to  do  to  some  extent  through 
the  increased  use  of  machines.  But  the  greatest  spur  to  trying  out 
labor  substitutes  came  in  the  spring  of  1906.  During  the  previous 
two  years  the  Union  had  been  preparing  for  a  general  advance  in 
wages,  shorter  hours,  and  the  like,  and  in  May  declared  what  threat- 
ened for  a  short  time  to  be  a  general  strike  to  bring  this  about.  In 
many  foundry  centers  it  was  impossible  to  secure  molders  except  at 
the  Union's  terms.  To  meet  this  situation  the  Association  called  a 
special  convention  and  determined  to  resist  the  demands,  no  matter 
what  the  cost.  Hence  foundrymen  who  up  to  this  time  had  been 
indifferent  to  the  molding  machines  or  had  refused  to  consider  them 
were  forced  to  have  them  installed  in  order  to  get  their  orders  out. 
A  tremendous  incentive  was  given  to  inventors  also  to  produce  ma- 
chines which  would  take  care  of  work  hitherto  considered  to  be 
exclusively  the  province  of  skilled  men. 

A  circular  sent  to  members  of  the  Association,  June  23,  1906,  esti- 
mated that  nearly  1000  machines  had  been  introduced  since  May 
first,  and  pointed  out  that  increasing  numbers  of  foundrymen  were 
coming  to  realize  their  earning  power  when  operated  by  intelligent 
men.  The  improvement  in  technic  brought  about  in  that  crisis 
caused  the  president  of  the  Association  several  years  later  to  make 
the  assertion  that  until  the  1906  strike  the  founding  industry  was  at 
least  fifty  years  behind  the  times.- 

The  National  Founders'  Association  has  encouraged  the  introduc- 
tion and  use  of  machines  in  every  way.  Special  committees  have  been 

1  Report  of  the  Commissioner,  N.  F.  A.,  November,  1909,  in  the  Review^ 
December,  1909,  pp.  35,  36;  Hearings  (MS.),  Vol.  II,  p.  619. 

2  Proceedings,  N.  F.  A.,  November,  1910,  in  the  Review,  December,  1910,  p.  10. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      4.S3 

appointed  to  make  investigations,'  and  it  is  now  the  accepted  policy 
of  the  Association  when  a  member  is  having  difficulties  with  the 
Union  or  complains  of  a  shortage  of  labor  to  study  the  particular 
shop  in  question  and  map  out  a  plan  for  installing  machines  to 
take  the  skilled  men's  places.-  Just  what  effect  the  war  and  its 
needs  have  had  on  the  utilization  of  machines  is  not  subject  to 
statistical  measurement  at  this  time.  The  19 17  convention  of 
the  Association  devoted  an  entire  session  to  the  subject,  for  the 
purpose  of  demonstrating  to  its  members  how  many  current  prob- 
lems might  be  solved  by  the  introduction  of  mechanical  equip- 
ment. Molding-machine  manufacturers  are  said  to  be  overwhelmed 
with  orders,  and  delivery  cannot  be  made  in  less  than  six  or  eight 
months.  It  is  to  a  certain  extent  true  that  "the  molding  machine 
and  the  handyman  molder  have  made  possible  the  open  shop  in 

the  foundry."^ 

Specialization  has  been  developed  to  the  highest  possible  degree. 
Trained  designers  make  patterns  so  simple  that  a  man  with  little  ex- 
perience can  use  them.    Tool-makers  have  cooperated  to  turn  out 
machines  for  making  castings  which  the  molder  of  twenty  years  ago 
would  have  said  only  the  most  skilled  mechanic  could  produce. 
Laborers  and  operatives  trained  not  in  the  general  trade  of  molding 
but  only  in  one  simple  branch  do  work  which  it  was  thought  be- 
longed to  the  expert  on  the  bench.    Coremaking,  which  everywhere 
used  to  be  regarded  as  a  trade  in  itself,  has  also  become  somewhat 
of  a  machine  process.    The  technic  of  cupola  and  ladle  have  been 
vastly  improved.    An  overhead  crane,  reaching  into  all  parts  of  the 
shop,  lifts  patterns  and  molds  and  castings.    Sand  is  cut,  mixed,  and 
sifted,  and  castings  are  chipped  and  cleaned  by  machinery.    In  up- 
to-date  foundries  a  mechanical  engineer  often  has  charge  of  the  entire 
plant ;  a  chemist  tests  iron  and  sand  for  each  of  the  special  uses  to 
which  they  are  to  be  put.    Everywhere  the  development  of  the  in- 
dustry has  meant  increasing  differentiation  between  the  mental  and 
the  manual  work,  more  intense  simplification  of  processes,  more 


%\ 


1  Minutes  of  the  Administrative  Council,  N.F.A.,  November  19,  1908  (MS.). 
See  also  N.  F.  A.  Service  Bureau  Bulletins. 

2  Report  of  the   Commissioner,  N.F.A.,  November,   1910,  in   the  Review, 
December,  1910,  p.  27.  ^Ibid.  p.  30. 


454       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

minute  specialization  of  tasks.'  With  this  has  come  greater  efficiency 
of  management,  a  higher  standard  of  safety,  and  better  conditions 
generally  for  workmen,  producers,  and  the  consuming  public. 

It  is  not  to  be  understood  that  this  development  of  specialization 
and  the  use  of  machines  has  entirely  eliminated  the  Iron  Molders* 
Union  from  its  very  important  place  in  American  foundries.  That 
the  Union  has  retained  its  foothold  is  due  to  the  tireless  watchfulness 
of  the  organization's  leaders  and  their  speedy  adaptation  of  union 
law  to  meet  the  changing  conditions.  At  the  1907  convention  addi- 
tional steps  were  taken  to  get  the  machine  operators  into  the  organi- 
zation. This  came  the  year  after  their  only  partially  successful 
general  strike  had  shown  how  powerful  a  weapon  the  molding  ma- 
chines might  be  against  them.  The  constitutional  qualifications  for 
membership  were  defined  so  as  to  include  machine  operators  as  such ; 
they  were  to  be  granted  a  special  charter  in  any  community  large 
enough  to  support  a  separate  local,-  and  the  officers  were  given  great 
latitude  in  determining  the  method  of  compensation  for  work  done 
on  the  machines.'^ 

A  definite  campaign  to  organize  the  machine  operators  was  under- 
taken forthwith.  This  plan  under  way,  the  Union  believed  its  ma- 
chine problem  had  been  solved.  But  new  issues  continued  to  arise. 
Individual  members  insisted  upon  advocating  the  destruction  of 
machines  or  handicapping  their  usefulness  as  much  as  possible;'* 
proposals  were  made  to  do  away  with  the  special  machine  molders' 
cards,  which  would  allow  only  men  who  had  been  at  the  trade  four 
years  to  operate  the  machines."'  The  executive  board  has  sanctioned 
a  number  of  grievances  of  locals  against  the  use  of  handymen  on 
machines,^'  but  has  adhered  firmly  to  the  policy  of  organizing  and 
bringing  into  the  Union  as  many  machine  operators  as  possible. 

In  the  foundries  where  the  apprentice  ratio  of  one  to  five  journey- 
men prevails  the  policy  has  been  to  allow  machine  operators  who 

1  Subdividing  foundry  work  may  be  carried  to  such  extremes  as  to  produce 
facing-mixers,  mold-rammers,  pattern-drawers,  gate-formers,  feedinghead-makers, 
mold-closers,  metal-temperature  judges,  mold-pourers,  casting-feeders,  etc.,  all 
knowing  but  the  one  thing  which  has  been  learned  in  a  few  weeks  {Journal, 
1913,  p.  41). 

-Proceedings,  I.  M.  U.,  1907,  pp.  102,  103,  193;  Constitution,  adopted  1907, 
Article  VIII,  Section  6. 

'^Journal,  1907,  p.  650.  ^'Proceedings,  I.  M.  U.,  1912,  pp.  166,  243. 

^Ibid.  1909,  p.  122.  ^Ibid.  p.  51. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      455 

have  served  less  than  four  years  only  if  the  apprentice  quota  is 
not  complete.^  It  is  expected  that  in  union  shops  all  molding  ma- 
chines will  be  operated  by  union  mem.bers  or  apprentices.-  No  mem- 
ber is  permitted  to  teach  or  instruct  a  machine  operator  who  does 
not  belong  to  the  Union  or  who  is  not  an  apprentice,  under  penalty 
of  expulsion.  A  union  foreman  cannot  work  over  a  nonunion  machine 
operator  unless  the  latter  is  an  apprentice.^ 

The  net  result  of  the  attempts  to  enforce  in  American  foundries 
these  machine  policies  of  Union  and  Association,  so  essentially  in 
conflict,  would  be  hard  to  estimate.  The  following  table,  based  on 
figures  furnished  by  the  secretary  of  the  National  Founders'  Asso- 
ciation, shows  the  per  cent  machine  operators  were  of  the  total 
molding  force  in  the  foundries  of  Association  members  at  different 

periods :  * 

1900 9.4  per  cent 

1905 14.4  per  cent 

1910 19.4  per  cent 

jgj^ 22.8  per  cent 

In  the  same  time  skilled  bench  and  floor  molders  changed  in  relative 
importance  to  the  total  molding  force  as  follows,  constituting  in 

1900 75.7  per  cent 

1905 63.0  per  cent 

1910 54.3  per  cent 

1913 51.8  per  cent 

Comparing  these  two  groups,  it  appears  that  while  molding- 
machine  operators  have  increased  considerably  in  importance  to  the 
total  molding  force  in  Association  foundries,  skilled  mechanics  have 
been  displaced  at  a  more  than  proportionate  rate.  It  thus  would 
seem  that  machine  operators  alone  cannot  be  charged  with  having 
driven  journeymen  from  their  accustomed  trade.  Of  nearly  as  great 
importance  in  bringing  this  about  has  been  the  increase  in  the  num- 
bers of  unskilled  specialty  molders.  Data  available  do  not  permit 
of  distinguishing  this  class  of  labor  from  apprentices  in  1900,  but 
the  increase  even  from  1905  to  19 13  is  significant. 

1  Proceedings,  I.  M.U.,  1912,  p.  222. 

2/6id.  pp.  156,  206,  223,  238. 

^Ibid.  pp.  126,  127,  206;  Constitution,  adopted  1912,  Article  XIII,  Section  8. 

*  See  also  Quarterly  Journal  of  Economics,  Vol.  XXX  (1916),  p.  381. 


I 


it  I 


i 


m 


1 


il 


456       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Per  cent  specialty  molders  were  of  the  total  molding  force: 

1905 9.5  per  cent 

1 910 I  5.0  per  cent 

1913 15.6  per  cent 

These  figures,  taken  in  connection  with  the  preceding  groups,  must 
not,  however,  be  used  as  conclusive  evidence  that  unskilled  workmen 
are  usurping  the  places  of  journeymen  in  the  foundries  of  members 
of  the  National  Founders'  Association,  because  of  the  fact  that  there 
is  no  way  of  measuring  to  how  great  an  extent  the  class  of  foundries 
making  up  the  membership  of  that  body  has  changed,  so  as  to  offer 
a  wider  opportunity  for  the  employment  of  laborers.^  Nevertheless, 
from  the  facts  available  it  seems  likely  that  while  skilled  mechanics 
continue  to  occupy  an  important  position  in  Association  foundries, 
their  place  is  gradually  being  taken  by  inferior  craftsmen. 

How  this  tendency  compares  with  conditions  generally  cannot  be 
stated.  In  19 10  the  National  Founders'  Association  employed  13.4  per 
cent  of  all  those  in  the  country  who  worked  at  the  trade  of  mold- 
ing.- Eighty-five  per  cent  of  its  members  run  open  shops.''  It  is 
therefore  possible  that  among  those  foundries  where  union  influence 
has  had  more  weight  skilled  journeymen  are  of  relatively  greater  im- 
portance than  in  the  shops  of  the  Association.  Certainly  up  to  1908 
the  Union  had  succeeded  admirably  in  controlling  the  machine 
situation  in  the  shops  of  the  Stove  Founders'  National  Defense 
Association/  and  as  these  two  latter  bodies  never  came  to  an  agree- 
ment as  to  the  pricing  of  work  done  on  the  machines  until  19 14,  it 
is  quite  likely  there  has  been  but  little  change  up  to  the  present  time. 

The  Union  itself  offers  no  data  as  to  the  relative  importance  within 
its  membership  of  skilled  mechanics,  specialty  molders,  and  machine 
operators.    Nor  is  there  any  satisfactory  means  of  estimating  the 

lAn  increase  in  the  number  of  members  who  made  specialties  as  against  those 
who  made  heavy  machinery  would  mean  a  greater  likelihood  of  the  employ- 
ment of  machine  operators  and  specialty  molders.  The  reverse  would  be  true 
if  the  increase  in  members  came  from  the  ranks  of  the  heavy  machinery-makers. 

2  On  the  basis  of  18,411  molders  and  coremakers,  exclusive  of  apprentices, 
employed  by  the  National  Founders'  Association,  and  a  total  of  137,262  male 
molders,  founders,  casters,  and  coremakers  enumerated  in  the  census  of  1910 
(Thirteenth  Census  of  the  United  States,  1910,  Vol.  IV,  Table  VI). 

3 Hearings  (MS.),  Vol.  I,  pp.  242-243,  245,  248,  251. 

*  Stove  Founders'  National  Defense  Association,  Report  of  the  Committee 
on  Machinery,  1908. 


FOUNDERS,  MOLDERS,  MOLDING  MACHINE      457 

probable  composition  of  its  membership  at  the  present  time  as  com- 
pared with  twenty  years  ago.  It  seems  very  probable,  however,  on 
the  basis  of  known  facts,  that  even  though  the  numbers  over  a  given 
period  are  substantially  identical,  a  smaller  and  smaller  proportion 

are  skilled  men. 

This  much  is  true :  molding  machines  have  made  serious  inroads 
upon  the  molders'  trade ;  the  employers  of  the  country  have  come  to 
realize  the  value  of  machines  and  are  using  them  in  ever-increasing 
quantities ;  the  Molders'  Union  has  been  obliged  to  alter  its  policy 
at  a  number  of  points  to  allow  for  the  changed  conditions.  On  the 
other  hand,  it  is  not  true  that  machines  have  made  human  skill 
unnecessary  for  foundry  work.  There  is  still  a  great  demand  for 
trained  men.  Even  with  specialization  and  machine  molding,  experts 
are  required  to  set  cores,  finish  and  close  molds,  and  perform  other 
similar  operations  demanding  the  application  of  technic  and  judg- 
ment.   Some  types  of  molding  are  as  yet  entirely  unadapted  to  the 

machines. 

To  how  great  an  extent  the  proportion  of  skilled  men  required  will 
decrease  in  succeeding  decades  cannot  possibly  be  determined.  On 
this  will  hinge  almost  entirely  the  Union's  structure  and  activities. 
And  on  this  will  depend  to  a  large  degree  the  future  policy  of  the 
Association.  If  a  steadily  increasing  proportion  of  the  trade  is  given 
over  to  machines  and  unskilled  foreign  workmen  whom  it  is  difficult 
for  the  Union  to  organize  and  hold  in  the  face  of  alluring  offers  from 
their  employers,  the  Union  is  likely  to  suffer.  If  the  maximum  pos- 
sibilities of  the  machines  have  already  been  realized,  the  Union  stands 
a  very  fair  chance  of  holding  its  own,  no  matter  what  the  organized 

employers  may  do. 

Margaret  Loomis  Stecker 

Cambridge,  Massachusetts 


>-*! 


COLLECTIVE  BARGAINING  IN  THE 
GLASS-BOTTLE  INDUSTRY^ 

T^HE  agreement  between  the  Glass  Bottle  Blowers'  Association 
A    and  the  National  Glass  Vial  and  Bottle  Manufacturers'  Associa- 
tion furnishes  an  impressive  and  an  instructive  exhibit  of  the  feasi- 
bility of  carrying  on  for  a  long  term  of  years  a  peaceful  and  mutually 
agreeable  system  of  collective  bargaining.    While  friction  between  the 
parties  to  the  agreement  has  at  times  been  great  and  while  the  agree- 
ment has  often  been  almost  at  the  breaking  point,  yet  so  enlightened 
has  been  the  policy  of  the  representatives  of  both  the  union  and  the 
manufacturers'  association  in  granting  concessions  and  in  yielding 
upon  disputed  points  that  the  agreement  has  operated,  in  one  form  or 
another,  for  almost  a  quarter  of  a  century.    Nor  have  external  con- 
ditions been  particularly  favorable  to  the  continued  life  of  the  agree- 
ment.   The  technical  revolution  of  the  industry,  beginning  in  the 
middle  nineties  with  the  installation  of  the  so-called  "  semi-automatic  " 
machine  and  intensified  after  1900  by  the  invention  and  the  later 
extensive  use  of  the  Owens  automatic  machine  for  the  manufacture  of 
glass  bottles,  has  presented  to  the  conferences  of  the  manufacturers 
and  their  employees  problems  that  every  year  become  more  perplex- 
ing and  more  difficult  of  solution.    The  promulgation  of  working  rules 
to  govern  those  members  of  the  union  who  were  employed  on  the 
semi-automatic  machines,  the  regulation  of  the  wage  scale  so  as  to 
retain  a  fair  wage  for  the  glass  blower  and  at  the  same  time  to  permit 
the  employer  of  hand  blowers  to  compete  against  the  machine,  and 
finally  a  new  adjustment  of  wage  scales  designed  to  meet  the  com- 
petition of  the  automatic  are  a  few  of  the  problems  which  have  re- 
ceived at  the  hands  of  the  annual  conference,  if  not  a  perfect  solution 
at  least  a  workable  settlement.  ' 

iFrom  American  Economic  Revieiv,  Vol.  VI  (1916),  pp.  549-567, 

458 


ill 


THE  GLASS-BOTTLE  INDUSTRY 


459 


HISTORY  AND  GENERAL  DESCRIPTION  OF  THE  AGREEMENT 

The  glass-bottle  blowers  were  organized  originally  not  in  one 
national  organization  but  in  the  separate  and  independent  Eastern 
and  Western  Leagues  of  Green  Glass  Bottle  Blowers.    In  1886  the 
Western  League  became  affiliated  with  the  Knights  of  Labor  as 
District  Assembly  143  of  that  organization,  and  in  the  same  year  the 
Eastern  League  was  affiliated  as  District  Assembly  149.    As  early  as 
1886,  also,  there  is  record  of  annual  conferences  between  the  Eastern 
and  Western  Leagues  of  blowers  and  of  loosely  organized  associations 
of  Eastern  and  Western  bottle  manufacturers.  The  fact,  however,  that 
the  organizations  in  these  two  sections  of  the  country  often  worked 
at  cross-purposes  and  that  concessions  from  the  one  would  at  times 
be    used    to    force    similar   concessions    from    the    other,    coupled 
with  the  fact   that  the   frequent  passage  of  journeymen  blowers 
from  district  to  district  made  the  disciplining  of   their  member- 
ship difficult,  soon  led  to  a  movement  to  amalgamate  the  Western 
and  Eastern  Leagues  of  Glass  Bottle  Blowers  into  one  national 

organization. 

In  1890,  accordingly,  the  Eastern  and  Western  Leagues  united 
in  one  body  under  the  title  of  the  National  Trade  Assembly  143, 
Knights  of  Labor  of  America.  And  in  July,  1891,  the  assembly 
withdrew  from  the  Knights  of  Labor  to  become  the  Green  Glass 
Bottle  Blowers'  Association  of  the  United  States  and  Canada.  With 
the  formation,  then,  of  the  national  organization  of  glass-bottle 
blowers  in  1890,  the  sectional  conferences  of  preceding  years  were 
succeeded  by  national  conferences  between  representatives  of  the 
union  and  of  the  manufacturers. 

During  the  first  few  years  following  the  amalgamation,  evidence 
of  the  conflicting  interests  of  the  Western  and  Eastern  manufacturers 
could  still  be  found.  Thus,  at  the  conference  of  1890,  although  an 
agreement  could  have  been  effected  with  the  Western  manufacturers, 
the  chairman  of  the  conference  stated  that  he  could  not  promise  that 
the  Eastern  manufacturers  would  be  bound  by  the  findings  of  the 
conference.  Later  the  Eastern  manufacturers  actually  withdrew  from 
the  conference.  Indeed,  it  was  at  that  time  the  opinion  of  the  officers 
of  the  union  that  the  '^Eastern  and  Western  manufacturers  were  evi- 
dently trying  to  effect  a  settlement  independently  of  each  other  to 


n 


n\ 


i 


I. 


tH 


ill 


, 


460       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

create  discontent"  in  the  ranks  of  the  union.^  But  since  the  union 
would  treat  only  with  a  joint  committee  representing  the  manufac- 
turers from  both  sections  of  the  country,  the  manufacturers  were 
unsuccessful  in  their  efforts  to  revert  to  the  earlier  sectional  confer- 
ences. With  the  gradual  development  of  the  machinery  of  the 
conferences  and  with  the  growth  in  mutual  confidence  of  the  parties 
to  the  conferences,  the  conflicting  interests  of  the  different  sections 
became  less  pressing  and  the  manufacturers'  association  developed 
into  a  more  compact  and  more  homogeneous  organization. 

Prior  to  1899  it  had  been  customary  to  hold  annually  one  wage 
conference  in  the  month  of  either  July  or  August,  usually  several 
weeks  after  the  union  and  the  manufacturers'  association  had  held 
their  annual  conventions.  But  this  system  was  soon  found  to  be  open 
to  serious  objections.  A  single  annual  conference,  at  which  were 
submitted  by  the  conferees  demands  and  counterdemands  whose  pur- 
port was  known  only  to  their  sponsors,  precluded,  in  the  judgment  of 
both  the  manufacturers  and  their  employees,  that  familiarity  with 
the  propositions  which  is  essential  to  their  intelligent  consideration. 
The  plan  was  therefore  adopted  of  holding  a  preliminary  conference 
in  May,  at  which  would  be  submitted  the  demands  of  both  parties.^ 
Those  questions  upon  which  there  was  little  disagreement  would  be 
settled  at  this  preliminary  conference.  The  more  debatable  prop- 
ositions would  next  revert  to  the  annual  conventions  of  both  asso- 
ciations for  further  discussion  and  would  then  in  July  or  August  be 
submitted  to  the  final  conference  for  final  disposition. 

The  value  of  such  a  preliminary  conference  was  at  once  observed. 
President  Hayes  of  the  Glass  Bottle  Blowers'  Association  writes 
in  1900 : 

The  amount  of  work  done  at  the  May  conference  this  year  in  the 
way  of  listing  bottles  and  discussing  important  questions  proves  that 
this  prehminary  meeting  of  the  wage  committees  has  become  a  vital 
necessity,  unless,  indeed,  we  are  desirous  of  a  protracted  wage  con- 
ference later  on,  or  possibly  two  or  three  separate  ones,  which  may 
be  prolonged  to  such  an  extent  as  to  delay  or  hamper  the  beginning 
of  work  in  the  fall.  At  the  May  meeting  we  hear  the  manufacturers' 
side  of  the  story,  and  are,  therefore,  enabled  to  lay  it  before  the  con- 
vention for  discussion  and  counsel.    This  is  right  and  proper,  as  it 

1  Proceedings  of  the  United  Green  Glass  Workers'  Association  of  the  United 
States  and  Canada,  1892,  p.  13.  ^Agreement,  sect.  40,  in  Blast,  1899-1900, 


THE  GLASS-BOTTLE  INDUSTRY 


461 


is  a  matter  of  duty  for  us  to  view  all  questions  from  both  sides,  and 
it  would  be  neither  just  nor  safe  for  us  to  legislate  with  only  a  one- 
sided knowledge  of  matters  upon  which  the  trade  depends  so  much 
for  successful  operation.^ 

With  the  establishment  and  successful  operation  of  the  preliminary 
conference,  elaborate  rules,  regulating  the  conduct  of  the  preliminary 
and  final  conferences,  were  formulated.  Of  the  rules  regulating  both 
conferences  the  most  important  were  (i)  the  rule  providing  that 
no  question  which  had  not  been  brought  before  the  preliminary 
conference  would  be  considered  at  the  final  conference  and  (2)  the 
provision  for  the  submission  of  questions  by   the  parties   to  the 

conference.^ 

The  agreements  made  before  1902  laid  down  the  working  rules  and 
price  lists  for  each  year,  but  made  no  provision  for  the  adjustment 
of  questions  arising  between  the  annual  conferences.    There  was,  to 
be  sure,  the  rule  stating  that  "all  ware  not  specified  in  the  list  shall 
be  rated  at  the  same  price  and  subject  to  the  same  rules,  in  regard 
to  weight,  as  those  specified  in  the  list  which  they  resemble  in  size, 
shape,''weight,  and  finish."    This  clause  did  not,  however,  specify 
who  4as  to  settle  disputes  arising  from  disagreements  in  assigning 
new  bottles  to  various  brackets,  nor  upon  whom  was  to  devolve  the 
duty  of  interpreting  the  many  rules  included  in  the  annual  agree- 
ments.   This  link  in  the  agreement  was  supplied  at  the  conference  in 
1902.  At  the  suggestion  of  the  manufacturers,-^  the  president  of  the 
Blowers'  Association  was  chosen  as  the  officer  to  whom  "  all  informa- 
tion wanted  in  regard  to  the  intent  or  meaning  of  rules  and  regula- 
tions shall  be  referred."    It  was  further  provided  that  his  decision 
was  binding  until  reported  to  and  revised  by  the  joint  conference.* 

iProceedings,  Glass  Bottle  Blowers,  1900,  p.  47- 

2 The  manner  in  which  questions  are  submitted  to  the  conference  is  descnbed 
in  the  following  clause  of  the  agreement:  "Manufacturers  and  branches  shall 
notify  each  other  of  all  bottles  or  changes  intended  to  be  submitted  to  the  May 
conference,  and  the  reason  for  so  submitting  them,  which  notice  shall  be  in 
writing.  The  branches  shall  send  such  written  notices  to  the  president  of  the 
Glass  Bottle  Blowers'  Association  and  the  manufacturers  shall  send  their  written 
notices  to  the  president  of  the  National  Vial  and  Bottle  Manufacturers'  Asso- 
ciation." ("Wage-Scale  and  Working  Rules— Glass  Bottle  Blowers'  Associa- 
tion," sects.  42-44,  in  Blast,  1914-1915) 

3  Proceedings,  Glass  Bottle  Blowers,  1902,  p.  47. 

^Agreement,  rule  53,  in  Blast,  1902-1903. 


I 


462       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

As  in  the  case  of  all  matters  included  in  the  annual  agreements 
between  the  bottle  blowers'  union  and  the  bottle  manufacturers,  the 
rules  providing  a  mechanism  for  the  adjustment  of  disputes  arising 
between  the  final  conference  of  one  year  and  the  preliminary  con- 
ference of  the  succeeding  year  have  since  1902  undergone  some 
modification  and  considerable  amplification  and  exist  at  present  in 
the  following  form : 

All  information  wanted  in  regard  to  the  intention  or  meaning  of 
the  rules,  regulations  and  prices  shall  be  referred  to  the  president  of 
the  blowers'  organization,  whose  decision  in  all  such  cases  shall  be 
binding  unless  said  decision  is  reversed  by  the  joint  wage  preliminary 
conference  in  the  case  of  a  protest. 

Manufacturers  who  desire  to  protest  against  a  decision  of  the 
president  shall  serve  notice  in  writing  on  the  branch  in  their  locality 
of  their  intentions  to  protest,  and  shall  also  notify  the  presidents  of 
both  the  manufacturers'  and  blowers'  organizations  of  the  protest ; 
this  notice  shall  contain  all  information  necessary  for  a  proper  review 
of  the  case  protested.  Said  notice  shall  be  served  not  later  than  thirty 
days  prior  to  the  first  day  of  the  preliminary  conference. 

Protests  on  decisions  made  between  April  ist  and  July  31st  shall 
be  reviewed  at  the  final  conference,  with  notice  as  above  stated  to 
be  served  no  later  than  August  ist.  ' 

No  case  in  protest  shall  be  reviewed  bv  either  conference  unless 
the  foregoing  has  been  fully  complied  with.^ 

Originally,  when  a  clear  line  of  demarcation  existed  between  the 
flint-glass-bottle  workers  and  the  green-glass-bottle  makers,  the  union 
of  green-glass-bottle  makers,  the  parent  organization  of  the  present 
Glass  Bottle  Blowers'  Association,  held  wage  conferences  with  the 
association  of  green-glass-bottle  manufacturers.  Later,  however,  with 
the  introduction  of  the  tank  and  the  extension  of  its  jurisdiction  over 
all  bottle-makers,  whether  blowing  bottles  from  tanks  or  covered 
pots,  the  union  held  separate  conferences  with  the  green-glass  and 
with  covered-pot  manufacturers.  At  the  conference  of  the  representa- 
tives of  the  union  with  the  representatives  of  the  Flint  Bottle  Manu- 
facturers' Association  for  the  purpose  of  fixing  prices  and  rules  to 
govern  the  manufacture  of  covered-pot  ware  for  the  season  of  1902- 
1903,  the  chairman  of  the  conference,  a  manufacturer,  stated  "that 
in  his  opinion  all  matters  pertaining  to  the  making  of  bottles  should 

i"Wage-Scale    and    Working    Rules— Glass    Bottle    Blowers'    Association" 
sect.  45,  in  Blast,  1914-1915.  ' 


THE  GLASS-BOTTLE  INDUSTRY 


463 


be  settled  by  one  committee,  but  that  while  the  blowers  were  prac- 
tically all  in  one  association,  the  manufacturers  were  unfortunately 
divided  into  two,  hence"  the  necessity  for  two  conferences.    In  the 
following  year,  therefore,  the  scope  of  the  manufacturers'  organiza- 
tion  was  widened  to  include  all  persons  engaged  in  the  manufacture 
of  glass  bottles,  and  a  subcommittee  was  thereafter  annually  ap- 
pointed to  consider  questions  that  might  arise  between  the  covered- 
pot  manufacturers  and  their  employees.   Now  that  the  manufacturers 
of  covered-pot  ware  have  been  admitted  into  the  employers'  associa- 
tion   the  Glass  Bottle  Blowers'  Association  holds  annually  a  pre- 
liminary and  a  final  conference  with   the  representatives   of  one 
manufacturers'  association,  the  National  Glass  Vial  and  Bottle  Manu- 
facturers' Association.   At  these  conferences  there  are  drawn  four 
distinct  sets  of  price  scales  and  working  rules,    (i)  One  governs  the 
manufacturers  and  employees  engaged  in  the  hand  manufacture  of 
glass   from   the   tank;    (2)    another  governs   the  manufacture   of 
covered-pot  ware  ;  (3)  a  third  relates  to  rates  and  rules  for  the  semi- 
automatic  machine  in  the  manufacture  of  wide-mouth  ware  ;  and  the 
last  (4)  constitutes  the  wage  scale  and  working  rules  govermng  the 
"  United  and  the  O'Neill  and  the  one-  and  two-man  narrow-mouth 

machines."  ^, 

The  essential  features,  then,  of  the  agreement  between  the  Glass 
Bottle  Blowers'  Association  and  the  National  Bottle  Manufacturers 

Association  are  ,        r  r 

I    The  provision  for  annual  preliminary  and  final  conferences  for 

the  discussion  and  settlement  of  working  rules  and  wage  rates. 
2.  The  machinery  for  the  settlement  of  disputes  arising  between 

the  conferences  and  for  the  review  of  these  settlements. 

3    The  promulgation  of  price  lists  and  working  rules  for  the  four 

divisions  of  the  industry:  the   tank,   covered-pot,   semi-automatic 

wide-mouth,  and  semi-automatic  narrow-mouth  ware. 

THE  EMPLOYERS'  ASSOCIATION 
The  National  Glass  Vial  and  Bottle  IManufacturers'  Association 
existed  before  1890  as  the  Western  and  Eastern  Associations  of  Green 
Glass  Bottle  Manufacturers.  These  associations  were  loosely  or- 
ganized bodies  that  existed  principally  for  the  purpose  of  holding 
wage  conferences  with  the  Eastern  and  Western  Leagues  of  Green 


464       TRADE  UNIOxXISM  AND  LABOR  PROBLEMS 

Glass  Bottle  Blowers.    With  the  amalgamation  of  those  organizations 
in  1890  the  manufacturers  effected  a  somewhat  similar  combination 
which  apparently  confined  itself  to  the  selection  of  representatives 
to  the  annual  national  wage  conferences  with  the  United  Green  Glass 
Bottle  Blowers'  Association.    Later,  upon  the  absorption  by  the  Glass 
Bottle  Blowers'  Union  of  all  branches  of  the  trade,  the  employers' 
association  similarly  extended  its  jurisdiction.    In  the  constitution 
revised  and  amended  in  1902,  it  is  stated  that  the  Association  admits 
mto  membership  "any  person  who  manufactures  glass  vials  and 
bottles  m  tanks  or  open  pots  and  employs  workmen  under  the  juris- 
diction of  the  Glass  Bottle  Blowers'  Association." '   An  amendment 
to  the  constitution  is  now  pending  which  would  admit  into  member- 
ship "any  person  who  manufactures  glass  bottles  and  jars,  either 
from  tanks  or  from  open  or  covered  pots."- 

The  officers  of  the  organization  consist  of  president,  vice  president 
secretary,  and  treasurer  elected  annually  by  ballot  and  of  an  executive 
committee  appointed  annually  by  the  president.  This  committee 
together  with  the  officers  of  the  organization,  constitute  the  repre- 
sentatives of  the  Association  at  the  annual  conferences.  iMeetings  of 
the  Association  are  held  annually  between  the  preliminary  and  final 
joint  wage  conferences  and  are  occupied  almost  exclusively  with 
the  discussion  of  issues  raised  in  the  preliminary  conference 

The  Association  practically  restricts  its  activities  to  those  of 
collective  bargaining.  The  object  of  the  Association  has  been  "to  in- 
crease the  mutual  acquaintance  of  all  persons  engaged  in  the  manufac- 
ture of  vials  and  bottles ;  to  exchange  views  on  the  various  subjects 
that  are  of  general  interest ;  to  look  after  any  tariff  legislation  affect- 
ing the  welfare  of  the  business ;  to  attend  as  far  as  possible  to  any 
changes  or  discriminations  in  the  classifications  made  by  railroads  on 
the  line  of  goods  manufactured  and  handled  by  the  Association  •  to 
meet  with  the  blowers'  executive  board  as  often  as  may  be  necessary 
each  year  to  fix  a  uniform  scale  of  wages  for  blowing  the  various  kinds 
of  vials  and  bottles  manufactured  for  the  trade;  to  establish  rules 
and  regulations  for  the  government  of  all  factories  throughout  the 
Umted  States  and  Canada.  .      - 


J>3 


^Article  II. 

3cSlut:?'r;o^^ttict'L"''  Manufacturers'  Association.  May  .6.  .,.,. 


1! 

m 


THE  GLASS-BOTTLE  INDUSTRY 


465 


Although  provision  is  made  for  tariff  and  railroad  committees,^  the 
organization  has  shown  little  activity  in  this  direction. 

The  relations  of  the  Association  and  the  glass  bottle  blowers' 
union  have  on  several  occasions  been  almost  at  the  breaking  point, 
and  several  of  the  conferences  have  adjourned  without  reaching  an 
agreement.    The  organization,  however,  has  never  become  a  hostile 
association  and  no  record  is  extant  of  its  having  sanctioned,  as  an 
association,  even  isolated  acts  of  hostility  toward  the  blowers'  or- 
ganization.   In  a  few  cases,  to  be  sure,  it  has  been  unable  to  prevent 
members  from  violating  the  agreement ;  persistent  violation  would, 
however,  result  in  the  expulsion  of  the  member  from  the  Association. 
The  Association  has  never  adopted  any  system  of  fines  for  the 
disciplining  of  its  members,  either  for  the  violation  of  edicts  of  the 
Association  or  of  the  terms  of  the  joint  agreements.    Nor  did  it  have 
until  recently  any  settled  policy  toward  the  union  manufacturers  not 
members  of  the  Association.    For  some   time  such  manufacturers' 
were  permitted  to  attend  the  conferences,  to  submit  propositions, 
and  to  request  reviews  of  the  decisions  of  the  president  of  the  blowers' 
association.    At  the  final  conference  in  19 13,  however,  it  was  an- 
nounced that  the  following  resolutions  had  been  adopted  by  the 
National  Vial  and  Bottle  Manufacturers'  Association: 

Whereas,  There  are  a  number  of  Bottle  and  Jar  manufacturers 
throughout'  the  United  States  and  Canada,  employing  members  of 
the  Glass  Bottle  Blowers'  Association  who  have  heretofore  received 
practically  all  the  benefits  derived  from  the  action  of  the  Joint  Wage 
Conferences,  without  becoming  members  of  the  National  Vial  and 
Bottle  Manufacturers'  Association,  or  without  contributing  towards 
paying  the  necessary  expenses  connected  therewith.  Some  have  de- 
clared they  would  get  along  better  without  the  association  or  without 
a  Joint  Wage  Conference.  Others  declare  there  is  nothing  to  be  gained 
by  membership  in  the  organization  so  long  as  they  are  able  to  obtain 
the  benefits  therefrom  without  sharing  in  the  expenses,  and  by  not 
being  members  thev  argue  that  they  are  not  bound  by  the  action  of 
the  Joint  Wage  Conference,  yet  they  gladly  accept  and  make  use  ot 
all  decisions  of  said  conference  that  pleases  them,  therefore  be  it 

Resolved:  That  the  members  of  our  Executive  Committee  when 
in  conference  with  the  workmen's  committee,  be  and  are  hereby 
instructed  to  decline  hereafter  to  consider  any  disputes,  grievances, 
etc.,  or  the  listing  of  bottles,  their  prices  or  classifications  or  any  other 

1  Constitution,  Article  III. 


! 


! 

I 


466       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

matters  arising  in  a  factory  the  management  of  which  is  in  no  way 
affiliated  with  the  National  Vial  and  Bottle  Manufacturers'  Associa- 
tion that  may  come  before  the  Joint  Conference  either  directly  or 
indirectly,  thus  leaving  all  such  matters  to  be  decided  by  the  Presi- 
dent of  the  Glass  Bottle  Blowers'  Association,  whose  decisions  shall 
be  final  in  so  far  as  they  pertain  to  the  particular  factory,  but  any 
decision  he  shall  make  in  such  cases  shall  not  be  construed  as  estab- 
lishing a  precedent,  nor  shall  it  be  applied  to,  or  be  binding  upon 
other  factories,  but  it  is  understood  that  any  decision  thus  rendered, 
shall  upon  application  by  any  member  of  this  association,  be  subject 
to  review  by  the  Joint  Wage  Conference.^ 

These  resolutions  for  a  time  nonplussed  the  representatives  of  the 
union.  "While  this  was  a  rather  extraordinary  proceeding,"  writes 
the  secretary  of  the  blowers'  association  concerning  these  resolutions, 
"still  we  could  not  but  agree  with  them  in  their  contentions.  Our 
association  will,  therefore,  exercise  its  best  judgment  in  dealing  with 
those  who  do  not  belong  to  the  above-mentioned  association,  dealing, 
as  we  have  always  done,  fairly  and  impartially  with  all."-  The  net 
effect  of  this  action  of  the  employers'  association  is  to  leave  the  inde- 
pendent union  manufacturers  in  almost  the  same  condition  as  before. 
They  are  granted  by  the  union  the  same  working  conditions  and  the 
same  prices  as  operate  in  the  establishments  of  those  manufacturers 
belonging  to  the  organization.  There  is  this  difference,  however, 
the  independent  manufacturers  have  no  organization  to  which  they 
can  appeal  for  a  review  of  the  decisions  of  the  president  of  the 
blowers'  union. 

The  skilled  branch  of  the  glass-bottle  industry  is  about  90  per 
cent  organized.  During  the  nineties  and  the  early  part  of  the  last 
decade  strong  nonunion  centers  were  to  be  found  in  New  Jersey, 
western  Pennsylvania,  and  Indiana.  Vigorous  organizing  campaigns 
by  the  union  resulted  in  the  organization  of  many  of  the  nonunion 
plants,  until  today  a  high  degree  of  organization  has  been  reached. 
To  a  considerable  extent,  however,  nonunionism  still  flourishes  in  the 
gas  belt  of  Indiana  and  in  western  Pennsylvania.  Of  the  union  manu- 
facturers the  majority  are  members  of  the  employers'  association, 
and  the  resolution  adopted  in  19 13  resulted  in  the  entrance  of  about 
thirty-five  independent  manufacturers.  Those  who  still  remain  without 

^  Minutes,  Final  Conference,  Manufacturers'  Report,  1913,  p.  4. 
2  Minutes,  Final  Conference,  Blowers'  Report,  p.  19. 


I'HE  GLASS-BOTTLE  INDUSTRY 


467 


the  Association  feel  that  the  benefits  to  be  gained  are  not  worth 
the  expense  of  membership,  inasmuch  as  they  receive  the  same  terms 
from  the  union  as  do  those  manufacturers  belonging  to  the  Associa- 
tion. It  has  also  been  said  that  a  number  of  these  independent 
manufacturers  join  the  Association  when  they  have  grievances  to  be 
considered  and  withdraw  when  their  grievances  are  passed  upon 
and  adjusted. 

THE  MAKING  OF  THE  AGREEMENT 

Unlike  those  national  agreements  which  provide  only  the  machinery 
for  the  settlement  of  disputes  and  which  leave  to  the  local  unions  the 
formulation  of  working  rules  and,  in  some  cases,  wage  rates,  this 
agreement  fixes  in  detail  practically  all  of  the  conditions  of  employ- 
ment of  the  glass-bottle  makers.  The  local  unions  can  legislate  only 
upon  such  matters  as  are  concerned  with  the  internal  government 
of  the  union.  When,  however,  some  unforeseen  question  arises  during 
the  year  an  attempt  is  first  made  to  settle  the  matter  in  conference 
between  the  factory  committee^  and  the  employer,  and  if  they  are 
unable  to  arrive  at  an  agreement  the  question  is  referred  to  the 

president  of  the  union. 

All  questions  relating  to  prices  and  rules  which  are  not  settled  to 
the  satisfaction  of  both  parties  during  the  year,  and  those  matters, 
already  in  the  agreement,  which  one  or  the  other  party  wishes  to 
have  amended,  are  considered  at  the  May  preliminary  conference.  The 
questions  not  settled  at  this  conference  and  those  arising  between  the 
preliminary  and  final  conferences  receive  consideration  at  the  latter 
conference.  The  matters  upon  which  adjudication  is  desired  are 
usually  submitted  to  the  conferences  in  the  form  of  resolutions  from 
local  unions  or  of  requests  from  individual  manufacturers,  but  all  of 
such  resolutions  and  requests  must  conform  to  the  modus  operandi 
described  earlier  in  this  paper. 

The  members  of  the  executive  board  of  the  Glass  Bottle  Blowers* 
Association  act  as  the  representatives  of  the  union  at  the  conference. 
These  members  are  elected  annually  at  the  convention  of  their  or- 
ganization and  hold  office,  therefore,  only  for  one  year.  Although  the 
acta  of  the  representatives  of  the  union  thus  frequently  become  the 

1  The  factory  committee  is  a  committee  of  workmen  in  a  shop  chosen  by  the 
employees  in  that  shop  to  represent  them  in  conferences  with  the  employer. 


II 


468       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

subject  of  review  by  their  constituents,  the  union  conferees  have 
throughout  the  conference  debates  shown  unusual  independence  of 
judgment.  That,  however,  their  conduct  has  reflected  the  mature 
opinions  of  the  majority  of  the  union  is  attested  by  the  fact  that  many 
of  the  members  of  the  executive  board  have  been  reelected  over  a 
number  of  years.  Indeed,  the  president  of  the  Association,  an  ex 
officio  member  of  the  board,  has  now  held  that  position  for  almost 
twenty  years. 

The  representatives  of  the  union  have  full  power  to  settle  questions 
without  referring  the  matter  back  to  their  organization.  Nor  do  they 
go  to  the  conferences  instructed  to  take  one  stand  or  another.  At- 
tempts have,  to  be  sure,  been  made  from  time  to  time  to  instruct 
the  representatives  to  follow  out  a  certain  line  of  acticn  or  to  strip 
them  of  the  authority  to  settle  the  more  important  questions  arising 
at  the  conference.  These  attempts  have,  however,  always  been  met 
by  the  concerted  opposition  of  the  officers  and  of  the  majority  of  the 
membership.  Thus,  early  in  the  history  of  the  agreements  resolutions 
were  introduced  at  a  convention  removing  the  power  from  the  con- 
ferees to  settle  anything  relating  to  pri^^  lists,  apprentice  laws,  or 
market  money.  These  resolutions  were  .eceived  with  th:  following 
comment  from  the  president  of  the  union: 

To  adopt  the  amendment  would  simply  deprive  your  officers  of 
all  executive  power  and  make  them  mere  figureheads  to  represent  the 
organization.  Take  away  the  power  to  concede  or  alter  anything  in 
the  price  list,  apprentice  law,  or  market  money  and  you  leave  nothing 
of  any  importance  on  which  to  treat  with  the  manufacturers'  wage 
committee.  No  committee  of  manufacturers  would  meet  your  com- 
mittee unless  it  had  full  power  to  act  and  bind  the  association,  and  if 
this  convention  takes  this  power  from  them  it  would  be  more  sensible 
to  put  your  demands  on  paper  and  send  them  by  post,  saying  that 
such  is  the  will  of  the  conventions,  than  to  send  your  representatives 
there  merely  to  state  it.  This  convention  does  not  represent  all  the 
glass  trade,  only  the  working  portion  of  it.  Your  employers  represent 
the  other  portion.  They  also  have  an  association  and  appoint  a 
committee  to  present  their  demands  in  conference.  If  they  adopt 
the  same  principle  as  is  embodied  in  this  resolution  or  amendment, 
giving  their  committee  no  power  to  act  on  the  main  questions,  do  you 
for  a  moment  think  a  settlement  would  ever  be  effected  ?  No  man 
with  any  self-respect  could  accept  office  under  such  restrictions.^ 

1  Proceedings,  United  Green  Glass  Workers,  1894,  P-  24. 


THE  GLASS-BOTTLE  INDUSTRY 


469 


Again,  in  1906,  the  attempt  was  made  to  instruct  the  representa- 
tives of  the  union  on  a  definite  proposition.  Here  too  the  attempt  was 
unsuccessful.  In  this  case  the  resolution  providing  that  the  "30th 
annual  convention  instruct  our  president  and  executive  board  to  enter- 
tain no  proposition  for  reduction  in  wages  the  coming  season"  was 
replaced  by  the  resolution  "  that  it  is  the  sense  of  the  convention 
that  we  do  not  deem  it  advisable  to  accept  a  reduction  for  the 

coming  season."^ 

The  members  of  the  executive  board  of  the  manufacturers'  asso- 
ciation are  similarly  the  representatives  of  that  organization  at  the 
annual  wage  conferences.   Instead,  however,  of  being  elected  annually 
by  the  convention,  they  are  appointed  annually  by  the  president  of 
the  organization.   Like  the  union  conferees,  they  are  sent  to  the 
conferences  uninstructed.    But  here,  as  in  the  case  of  the  union,  dis- 
satisfaction with  the  work  of  their  representatives  has  at  times  been 
expressed  by  manufacturers.    These  objections  have  arisen  generally 
from  two  sources.    In  the  first  place,  the  manufacturers  of  handmade 
ware  have  long  protested  that  their  representation  upon  the  wage 
committee  has  been  inadequate  and  that  all  legislation  is  framed  to 
benefit  the  machine  manufacturers  at  their  expense.   Accordingly,  in 
191 2  a  number  of  the  hand  manufacturers  withdrew  from  the  annual 
conferences  on  the  grourid  that  those  conferences  were  "dominated 
by  the  machine  manufacturers,  and  we  do  not  care  to  have  the  ma- 
chine manufacturers  adjust  the  wages  for  the  hand  blown."  ^  The 
other  protest  arises  from  those  manufacturers  who  feel  that  their 
executive  committee  has  not  presented  the  case  of  the  manufacturers 
as  vigorously  as  it  might,  nor  has  it  been  insistent  enough  in  pressing 
their^'demands.    From  these  feelings  grew  out  the  request  that  the 
president  appoint,  in  addition  to  the  usual  committee,  two  alternates 
to  be  selected  '^  from  the  twenty  or  more  members  who  have  protested 
present  conditions"  with  the  power  to  attend  the  wage  conference." « 
At  the  preliminary  conference  of  1914  a  number  of  manufacturers 
and  members  of  the  National   Bottle  Manufacturers'   Association 
*' asked  permission  to  confer  with  the  members  of  the  committee 

1  Proceedings,  Glass  Bottle  Blowers,  1906,  p.  228. 

-Id.  1912,  p.  171-  ,     ,,        r     X  »    A 

3  Proceedings,  Annual  Meeting  of  the  National  Bottle  Manufacturers    As- 
sociation, August,  1914. 


I 


h"- ' 


1 


470       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

representing  the  manufacturers  and  desired  to  be  heard  concerning 
matters  in  which  they  were  interested."  Their  request  was  granted. 
When  the  meeting  was  called  to  order,  it  was  announced  "that  the 
meeting  would  be  of  an  informal  nature  and  each  person  present 
was  permitted  to  talk  upon  any  matters  that  were  coming  before  the 
Joint  Wage  Committee.  .  .  .  Nearly  all  of  the  visiting  members 
had  more  or  less  to  say,  and  many  things  were  explained  in  regard  to 
the  methods  and  manner  of  conducting  the  conferences.  .  .  .  The 
visiting  members  stated  later  that  they  had  learned  many  things 
concerning  the  joint  conference  which  they  did  not  know,  and  before 
retiring  expressed  themselves  as  being  much  better  satisfied  than 
when  they  came."^ 

WTiile  these  movements  of  protest  have  no  doubt  exerted  some 
influence  on  the  conduct  of  the  conferees,  neither  in  the  case  of  the 
union  nor  in  that  of  the  manufacturers'  association  have  they  effected 
any  change  in  policy  concerning  the  relation  of  the  representatives  to 
their  respective  organizations.  All  representatives  attend  the  annual 
conferences  as  exponents  of  the  sentiments  of  their  constituents; 
rarely,  however,  do  they  attend  bound  by  specific  instructions. 

No  formal  system  of  voting  is  provided  for  in  the  agreement,  but 
it  is  the  prevailing  practice  in  the  conferences  for  the  manufac- 
turers' representatives  and  for  those  of  the  union  to  vote  as  units. 
A  mere  majority  of  the  members  present,  therefore,  is  not  sufficient 
to  carry  a  measure.  The  measure  must  be  agreeable  to  a  majority 
of  the  representatives  of  each  party  before  it  can  become  a  part  of 
the  agreement. 

On  several  occasions  the  conferences  have  resulted  in  deadlocks. 
Under  such  conditions  it  has  been  the  custom  for  the  conference 
to  adjourn  and  for  the  majority  of  the  establishments  to  resume 
operation  under  rules  and  prices  of  the  preceding  year  in  the  hope 
that  the  following  year  would  find  the  union  or  the  manufacturers  less 
obdurate.  The  climax  of  a  series  of  demands  by  the  manufacturers 
for  substantial  reductions  in  piece  rates  came  in  1906,  when  the 
representatives  of  the  employers  persisted  in  demanding  reductions 
which  the  union  refused  to  grant.  During  the  debate  on  the  prop- 
osition Mr.  Ralston,  president  of  the  manufacturers'  association, 

1  Proceedings,  Preliminary  Wage  Conference,  Manufacturers'  Report,  1914, 
p.  3- 


i| 


THE  GLASS-BOTTLE  INDUSTRY 


471 


suggested  that  "  the  matter  be  submitted  for  arbitration  to  a  judge 
of  the  courts."^  The  suggestion  was  not  acted  upon.  Indeed,  the 
consensus  of  opinion  in  the  trade  seems  to  be  opposed  to  the  sub- 
mission of  major  issues  to  arbitration.  Both  employers  and  employees 
prefer  to  thresh  out  the  matters  in  conference  and,  when  it  is  found 
to  be  impossible  to  reach  an  agreement,  to  work  in  a  state  of  armed 
truce  for  one  or  more  years  under  the  rules  of  previous  years. 

When  it  was  stated  above  that  in  the  event  of  a  deadlock  the  manu- 
facturers would  open  their  plants  under  the  rules  and  prices  in 
operation  during  the  preceding  year,  it  should  have  been  noted  that 
these  resumptions  of  work  frequently  took  place  some  time  after  the 
annual  conference  had  adjourned.  During  this  period  between  the 
adjournment  of  the  conference  and  the  acceptance  by  the  manufac- 
turers of  the  union's  ultimatum  the  agreement  may  be  said  to  have 
been  suspended.  For  example,  at  the  conferences  in  1905  the  manu- 
facturers demanded  a  general  reduction  in  piece  rates  of  33 J^  per 
cent.  This  reduction  the  union  would  not  concede.  The  manufac- 
turers, therefore,  moved  to  adjourn  without  setting  a  date  for  a  further 
conference.  On  September  i,  1905,  the  president  of  the  Glass  Bottle 
Blowers'  Association  issued  a  circular  letter  containing  the  following 
statement: 

Up  to  the  present  we  have  heard  nothing  from  the  manufacturers' 
association.  Those  among  their  members  who  insisted  on  a  reduction 
and  favored  adjourning  the  conference  until  the  same  was  secured 
will  doubtless  remain  idle  as  long  as  they  possibly  can,  while  others 
in  that  association,  coupled  with  the  independent  manufacturers,  will 
begin  starting  their  factories  early  this  month.^ 

From  this  statement  it  is  seen  that  for  several  months,  at  least, 
after  the  adjournment  of   the  final  conference  the  industry  was 

1  Proceedings,  Glass  Boltle  Blowers,  1906,  p.  59- 

2  They  could  open  their  factories  and  employ  members  of  the  union  under  the 
previous  season's  list  and  rules;  for  on  August  8,  1905,  President  Hayes  had 
issued  the  following  circular  letter  to  the  trade:  "Manufacturers  who  desire 
can  engage  our  members  to  work  by  agreeing  to  pay  last  season's  wages,  and 
if  any  of  them  are  doubtful  about  our  ability  to  hold  out  and  want  assurance 
that  they  will  be  given  the  benefit  of  any  settlement  that  may  hereafter  be 
made  different  from  that  which  we  demanded  (last  year's  list  and  rules), 
branches  are  authorized  to  say  to  such  employers  that  they  will  be  given  the 
advantage  of  any  settlement  that  may  be  made  later  on  and  from  the  date  upon 
which  they  started  to  work." 


t 

I 


472        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

virtually  in  a  state  of  lockout,  or,  more  accurately,  the  agreement  was 
temporarily  suspended.  The  same  situation  arose  in  1909.  Again 
the  manufacturers'  demand  for  a  substantial  reduction  had  been  re- 
fused by  the  union.  Accordingly  the  conference  of  July  26,  1909, 
disbanded,  and  the  manufacturers  did  not  open  their  plants.  Early 
in  September,  however,  the  American  Bottle  Company  agreed  to 
accept  the  concessions  of  the  union.  Moved  by  this  break  in  its 
ranks,  the  manufacturers'  association  sought  another  conference,  at 
which  an  agreement  w^as  finally  reached.^ 

In  both  instances,  and  in  fact  in  all  other  similar  cases  during  the 
life  of  the  agreement,  the  strength  of  the  union,  in  that  it  is  virtually 
impossible  to  run  nonunion  shops  in  the  glass-bottle  industry,  forced 
the  employers  to  resume  operation  under  conditions  not  entirely 
satisfactory-  to  them.  Technically,  of  course,  this  delay  in  opening 
a  plant  might  be  described  as  a  lockout.  It  has,  however,  not  been 
so  regarded  by  the  parties  to  the  agreement.  Even  though  conferences 
were  adjourned  without  reaching  any  agreement  and  the  manufac- 
turers were  forced,  probably  because  of  the  superior  strength  of  the 
blowers'  organization,  to  employ  the  men  at  terms  unsatisfactory  to 
themselves,  yet  in  the  following  year  they  showed  confidence  in  the 
efficacy  of  a  system  of  collective  bargaining  by  again  entering  the 
conferences  with  their  employees. 

THE  SETTLEMENT  OF  DISPUTES  ARISING  UNDER   THE 

AGREEMENT 

In  an  agreement  which  specifies,  in  such  detail  as  does  the  present 
one,  practically  all  of  the  conditions  of  employment  the  matters 
which  arise  during  the  year  are  as  a  rule  purely  interpretations  of  the 
agreement.  For  example,  a  new  bottle  is  introduced  in  one  of  the 
factories  and  a  dispute  ensues  as  to  the  price  to  be  paid  for  blowing 
the  bottle ;  since  the  agreement  states  that  the  bottle  shall  "  be  rated 
at  the  same  price  and  subject  to  the  same  rules  in  regard  to  weight 
as  those  specified  in  the  bracket  which  they  resemble  in  size,  shape, 
weight  and  finish,"-  but  little  room  is  left  for  any  great  differences 
of  opinion.    The  same  might  be  said  of  any  question  that  might 

1  Proceedings,  Glass  Bottle  Blowers,  1910,  p.  11. 

-"Wage  Scale  and  Working  Rules,"  sect.  34,  in  Blast,  1914-1915, 


THE  GLASS-BOTTLE  INDUSTRY 


473 


conceivably  arise  under  the  agreement.  So  inclusive  are  the  annual 
agreements  and  so  definite  are  their  terms  that  probably  the  majority 
of  disputes  arising  in  various  localities  are  settled  by  merely  turnmg 
to  a  particular  rule  in  the  agreement  and  applying  it  to  the  case  m 
point.  On  the  other  hand,  disputes  have  been  observed  under  the 
agreement  where  there  was  no  question  of  the  interpretation  of  rules 
but  where  one  or  the  other  of  the  parties  deliberately  violated  or 
disregarded  the  agreement. 

The  first  step  in  the  adjustment  of  disputes  under  the  agreement 
consists  in  referring  the  matter  to  a  conference  of  the  employer  and 
a  factory  committee.    Most  disputes  are  settled  in  that  conference. 
When,  however,  the  conferees  are  unable  to  agree,  the  question  is 
referred  for  settlement  either  to  the  president  of  the  union  or  to  one 
of  the  executive  board  of  that  organization  whom  the  president  desig- 
nates as  his  representative.    The  president's  decisions  are  final  unless 
reversed  at  the  following  joint  conference.   Although  the  president  of 
the  union  has  been  acting  as  arbitrator  since  1902,  his  decisions  have 
been  but  rarely  reversed.   The  great  majority  of  his  adjudications  are 
concerned  with  the  determination  of  prices  on  new  ware,  samples  of 
which  are  sent  to  the  central  office  of  the  union  for  his  inspection. 
In  those  cases  where  he  has  decided  upon  a  certain  price  and  that 
price  is  found  by  the  joint  conference  to  have  been  too  high,  the 
manufacturer  is  reimbursed  for  the  excess  wage  payments  ;  conversely, 
a  decision  in  favor  of  the  employer,  which  might  be  reversed  by  the 
joint  conference,  forces  the  employer  to  make  up  the  difference  in 
wages.    Instituted  originally  at  the  suggestion  of  the  employers,^ 
the  system  of  delegating  to  the  president  of  the  union  the  power  of 
interpreting  rules  and  of  settling  disputes  has,  during  its  existence  of 
twelve  years  or  more,  worked  admirably.    With  hardly  an  exception 
the  decisions  made  by  the  president  during  his  incumbency  have  met 
with  general  approval ;  and  no  record  is  as  yet  to  be  found  of  any 
suggestions,  from  either  workman  or  manufacturer,  which  would  so 
modify  that  section  of  the  agreement  as  to  remove  from  the  president 
of  the  Glass  Bottle  Blowers'  Association  his  present  powers. 

The  history  of  the  operation  of  the  agreement  has  been  notably  free 
from  strikes  and  lockouts.    The  great  centralization  of  power  in 
the  hands  of  the  national  organization,  and  the  apparent  general 
1  Minutes,  Preliminary  Conference,  Blowers'  Report,  May,  1902,  p.  21. 


,41 


*f 


474       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

opinion  among  the  members  of  the  union  that  such  centralization  is 
wise,  has  resulted  in  a  universal  support  by  the  subordinate  unions 
of  the  mandates  of  their  national  officers  and  of  the  decisions  of  the 
joint  conferences.  When,  for  example,  a  general  reduction  in  piece 
rates  was  adopted  by  the  conference,  several  local  unions  in  San 
Francisco  expressed  their  dissatisfaction  with  the  agreement  and 
struck.  This  violation  of  the  agreement  was  met  with  prompt  action 
by  the  national  officers,  who  ordered  the  strikers  back  to  work.  The 
strikers  first  denied  that  they  had  stopped  work,  but  after  a  few 
days,  when  the  charge  was  proved,  they  returned  to  work  under  the 
prices  and  rules  against  which  they  had  revolted.^  The  action  of  the 
national  officers  was  upheld  later  by  the  national  convention  of 
the  union. 

Similarly,  among  the  manufacturers,  the  attempts  to  violate  the 
agreement  by  locking  out  the  employees  or  by  running  shops  under 
rules  contrary  to  those  adopted  by  the  conferences  have  been  few  and 
far  between.  In  this  case,  however,  compulsion  upon  the  manufac- 
turers has  not  come  from  the  manufacturers'  association.  This  or- 
ganization, unlike  the  Glass  Bottle  Blowers'  Association,  has  little 
control  over  its  members  and  can,  therefore,  do  little  in  forcing  its 
members  to  observe  the  terms  of  the  joint  agreements.  The  follow- 
ing debate  at  the  conference  of  1905  indicates  the  position  of  the 
manufacturers'  association  in  enforcing  upon  its  members  the  de- 
cisions of  the  joint  conference : 

Mr.  Hayes  stated  that  it  was  a  sort  of  rule  among  his  predecessors 
at  these  conferences  to  ask  the  manufacturers  whether  they  would 
abide  by  the  decisions  of  the  conference,  but  such  a  course  has  not 
been  his  policy,  because  he  always  assumed  that  the  agreement  would 
be  lived  up  to  by  all  of  the  manufacturers  represented  by  the  com- 
mittee, but  during  the  past  year  some  had  violated  the  agreement  and 
some  had  intimated  that  the  executive  committee  has  been  accused 
of  extending  special  favors  to  some  manufacturers  while  refusing  them 
to  others.  .  .  .  The  chairman  (a  manufacturer)  stated  that  when  the 
agreement  is  signed  it  becomes  a  moral  obligation  of  all  manufacturers 
employing  union  labor  to  live  up  to  it,  but  that  there  was  nothing 
in  the  hands  of  the  committee  or  the  individual  members  thereof  to 
enforce  it.  Any  manufacturer  could  refuse  to  obey  it,  the  power  to 
enforce  being  wholly  in  the  hands  of  the  blowers.^ 

1  Proceedings,  Glass  Bottle  Blowers,  1910,  p.  153. 

2 Minutes,  Final  Conference,  Manufacturers'  Report,  1905,  p.  4. 


\t. 


:    H 


THE  GLASS-BOTTLE  INDUSTRY 


475 


Although  the  power  to  compel  obedience  to  the  agreement  and 
to  the  decisions  of  the  president  of  the  blowers'  association  m  his 
settlement  of  disputes  resides  in  neither  the  employers'  association 
nor  the  union,  yet  the  desire  of  the  manufacturers  generally  to  avoid 
any  action  that  might  lead  to  a  discontinuance  of  the  annual  con- 
ference, and  the  strength  of  the  union,  which  enables  it  to  bring 
recalcitrant  employers  into  line  by  threatening  to  withdraw  their 
working  force,  are  the  two  factors  which  operate  to  prevent  more 
frequent  and  more  serious  breaches  of  the  agreement. 

It  will  have  been  observed  in  the  foregoing  discussion  that  the 
few  suspensions  of  the  agreement  have  arisen  not  from  dissatisfaction 
with  the  adjudications  of  minor  issues  under  the  agreement,  but 
have  in  reality  constituted  revolts  against  the  settlement  of  the  major 
issues  embodied  in  the  agreement.  For  instance,  at  the  preliminary 
conference  of  1909  Mr.  Hayes  reported  that  some  of  the  manufacturers 
had  refused  to  be  bound  by  the  agreement  and  had  operated  their 
factories  during  the  so-called  "summer  stop"  agreed  upon  by  the  last 

conference.^  ,      .  ^    . 

Here   obviously,  there  was  no  question  of  the  interpretation  or 
application  of  a  rule  of  the  agreement,  but  a  deliberate  disregard  of 
a  rule  whose  meaning  and  intent  was  plain.   This  situation,  which  is 
in  a  way  a  typical  one,  suggests  the  following  general  proposition  con- 
cerning the  operation  of  the  agreement :  Where  the  national  agree- 
ment lays  down  in  detail  working  rules  and  piece  rates,  leaving  to 
local  adjustment  matters  of  purely  secondary  importance,  the  dis- 
putes arising  between  conferences  are  likely  to  be,  as  they  are  in 
this  particular  instance,  protests  not  against  interpretation  of  the 
agreement,  though  t'nere  are  undoubtedly  some  disputes  of  such  a 
character,  but  against  attempts  to  enforce  the  plain  letter  of  the 
agreement    The  remote  design  behind  such  protests  is,  of  course, 
the  desire  to  stir  up  a  sentiment  against  the  objectionable  practice 
or  rule  and  to  have  that  rule  amended  or  rejected  at  the  following 

conference.  ,     .  ,    .         ,  ^, 

The  practical  absence  of  any  widespread  violation  of  the  agree- 
ment can  be  attributed  primarily  to  two  factors  :  (i)  the  character 
of  the  persons  in  the  industry  and  (2)  the  national  character  of  the 

agreement. 

1  Minutes,  PreUminary  Conference,  Manufacturers'  Report,  1909,  p.  8. 


I 


476       TRADE  UNIONISM  AXD  LABOR  PROBLEMS 

I.  The  members  of  the  Glass  Bottle  Blowers'  Association  have 
always  been  and  are  today  highly  skilled  workmen,  whose  earnings 
were  for  many  years  far  above  those  of  skilled  workmen  in  other 
industries.    The  high  wages  earned  and  the  skill  required  to  perform 
the  work  have  apparently  combined  to  form  workmen  of  conservative 
instincts  and  of  mature  judgment.    The  character  of  the  workmen 
has  again  and  again  been  evidenced  in  the  selection  of  officers  of  a 
high  type  and  in  the  general  support  by  the  membership  of  such 
legislation  as  the  voluntary  reduction  of  piece  rates,  which  would 
in  other  industries  have  engendered  the  deepest  hostility  among  the 
rank  and  file  of  the  organization.    In  addition,  problems  following 
the  introduction  of  machinery,  of  the  gravest  import  to  all  members, 
have  been  met,  if  not  always  with  perfect  assurance  and  without 
petty  squabbles,  at  least  in  an  open-minded  and  intelligent  fashion. 
2.  The  national  character  of  the  agreement,  which  lodges  in  the 
national  officers  of  the  union  the  responsibility  for  the  content  of  the 
agreement  and  for  its  enforcement,  imposes  upon  these  officials  a 
personal  interest  in  the  successful  working  of  the  agreement  which 
makes  for  a  more  diligent  and  more  stringent  enforcement  of  its  terms. 
From  the  standpoint  of  the  machinery  of  the  agreement,  also,  that 
clause  which  designates  the  president  of  the  blowers'  association  as 
the  arbiter  of  interconference  disputes  probably  inspires  in  the  mem- 
bers of  the  union  a  respect  for  the  agreement  and  a  belief  in  its  fair- 
ness which  might  otherwise  not  have  existed.    The  adherence  of  the 
employers  to  the  agreement  is  perhaps  even  easier  to  explain.    In  the 
first  place,  this  system  of  collective  bargaining,  by  maintaining  uni- 
form wage  scales  and  working  rules  throughout  the  whole  of  the 
industry,  has  eliminated  the  objectionable  inequalities,  as  between 
different  employers,  that  are  an  inevitable  accompaniment  of  a  de- 
centralized system  of  collective  bargaining.    Second,  the  history  of 
the  agreement  has  been  such  as  to  modify  to  a  considerable  degree 
the  attitude  of  the  employers  toward  their  workmen.    For  on  three 
different  occasions  the  union,  after  much  pressure  to  be  sure,  has 
agreed  to  substantial  reductions  in  wage  rates. 


Leo  Wolman 


University  or  ]VIichigan 


XXXI 

THE  SAN  FRANCISCO  BUILDING  TRADES^ 

THE  brewery  trades  and  the  building  trades  represented  the  two 
extremes  among  the  trade-unionists  of  San  Francisco  as  regards 
collective  bargaining  and  trade  agreements.  The  brewery  trades  had 
long  and  effectively  upheld  such  policies,  while  the  buildmg-trades 
unions  had  as  vigorously  opposed  them.  Yet  both  groups  had  com- 
pletely dominated  their  respective  fields  and  had  secured  the  greatest 
returns  for  their  members. 

The  effectiveness  of  the  Building  Trades  Council  was  due  to  a 
great  extent  to  the  thoroughness  of  organization  existing  among  the 
building-trades  craftsmen,  which  was  made  possible  by  the  measures 
and  policies  adopted  by  the  Council  and  its  executive  officers.  It 
spent  little  or  no  time  in  idle  talk  and  in  passing  meaningless  reso- 
lutions. It  did  things,  and  while  the  methods  employed  at  times  may 
be  open  to  criticism,  one  is  compelled  to  admit  that  it  obtained  higher 
wages,  shorter  hours,  and  better  conditions  of  employment  for  its 
members  than  would  otherwise  have  been  possible. 

In  the  first  place,  the  Council  stood  for  the  rigid  enforcement  of 
the  working-card  system,  whereby  every  worker  was  compelled  to 
carry  his  working  card,  showing  that  he  was  a  member  of  his  union 
in  good  standing.  The  State  Building  Trades  Council,  through  its 
general  executive  officers,  issued  quarterly  working  cards  to  the 
local  building-trades  councils,  which  were  then  reissued  to  the  affil- 
iated unions,  and  by  them  to  their  paid-up  members.  These  cards 
were  of  different  color  for  each  quarter  of  the  year. 

The  constitution  and  by-laws  of  the  State  Building  Trades  Coun- 
cil declared  that  this  working-card  system  was  to  be  "enforced  in 
accordance  with  the  local  law  and  the  objects  of  the  State  Building 
Trades   Council."     The   San   Francisco    Building   Trades   Council 

^From   the   University   of   California   Publications   in   Economics,   Vol.   IV 

(1918),  pp.  331-342. 

477 


f 

i 

4 


m 


II 


478       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

strictly  enforced  this  policy.  Sections  1-5  of  Article  II  of  the  by-laws 
of  the  local  council,  which  related  to  this  matter,  were  as  follows : 

Section  i.  Quarterly  working  cards  shall  be  issued  to  unions  quar- 
terly two  weeks  prior  to  issue,  bearing  the  seal  of  the  Council  and  the 
signatures  of  the  President  and  Recording  and  Corresponding  Secre- 
tary. It  shall  be  the  duty  of  the  Financial  Secretary  of  each  affiliated 
union  to  attach  his  signature  to  each  card  issued  to  the  members 
thereof. 

Section  2.  It  shall  be  the  imperative  duty  of  all  members  of  unions 
affiliated  with  this  Council  to  carry  the  current  Quarterly  Working 
Card  of  the  State  Building  Trades  Council,  or  a  permit  issued  in  lieu 
thereof,  while  at  work.  Any  member  working  without  said  card  shall 
be  subject  to  a  fine  of  one  day's  wages  for  each  day  he  so  works,  and 
must  immediately  cease  work  upon  the  request  of  any  member  of  any 
affiliated  union  until  such  time  as  he  secures  a  current  Quarterly 
Working  Card  of  the  State  Building  Trades  Council,  or  a  permit 
issued  in  lieu  thereof. 

Section  3.  It  shall  be  the  duty  of  all  members  of  unions  affiliated 
with  this  Council  to  show  such  working  card  when  requested  to  do  so, 
or  when  challenged  by  any  duly  accredited  Business  Agent  of  this 
Council.  Any  member  refusing  to  show  his  card  when  requested  to 
do  so  shall  be  subject  to  a  fine  of  not  less  than  one  day's  wages. 

Section  4.  Each  craft  when  starting  to  work  on  a  job  shall  appoint 
a  steward  for  said  job.  Stewards  shall  see  that  every  man  working 
upon  the  job  carries  the  current  Quarterly  Working  Card  of  the  State 
Building  Trades  Council.  Stewards  of  the  different  crafts  shall  inter- 
view the  workmen  of  each  craft  employed  thereafter  on  said  job,  and 
ascertain  before  8  a.m.,  between  12  m.  and  i  p.m.,  or  after  5  p.m. 
if  they  have  the  current  Quarterly  Working  Card  of  the  State  Build- 
ing Trades  Council.  Stewards  neglecting  to  perform  their  duty  or 
failing  to  immediately  notify  the  Council  of  any  man  working  with- 
out such  card  shall  be  subject  to  a  fine  of  not  less  than  one  day's  pay. 

Section  5.  Each  member  of  every  union  affiliated  with  this  Council, 
upon  going  to  work  on  any  job  where  other  workmen  of  the  building 
trades  are  employed,  shall,  before  beginning  work  on  said  job,  ascer- 
tain if  other  workmen  thereon  carry  the  current  Quarterly  Working 
Card  of  the  State  Building  Trades  Council.  Should  any  workman 
without  the  current  Quarterly  Working  Card  work  on  any  job,  it 
is  the  duty  of  each  and  every  member  of  affiliated  unions  working 
thereon  to  immediately  notify  the  Council.  Failing  to  do  so,  such 
members  of  affiliated  unions  shall  be  subject  to  a  fine  of  one  day's 
wages  for  each  day  that  they  work  with  any  workman  not  carrying 
the  current  Quarterly  Working  Card  of  the  State  Building  Trades 
Council. 


THE  SAN  FRANCISCO  BUILDING  TRADES         479 

All  matters  bearing  upon  the  violation  of  these  ^^f'^^'^'^'l^ 
any  way  concerned  the  Building  Trades  Council,  and  appeals  f  om 
tesTmposed  by  the  local  unions,  were  brought  before  ,ts  executive 
SXing '9:3  and  x^M,  owing  to  the  ^t-  of -emp  o^^^^^^^^^^ 
the  executive  board  had  a  large  number  of  violations  of  the  above 
sections  brought  to  its  attention.  Fines  were  imposed  and  sincere 
efforts  were  made  to  enforce  the  regulations  of  the  C°"nc.l. 

Another  matter  which  made  for  the  ^K^^.^^^";^;" .  "  ''"l 
Trades  Council  was  the  vigorous  manner  in  which  the  P"!^'^  ° 
the  Council  were  carried  out  by  those  in  charge  of  its  affairs.   Various 
*  aSwere  employed  by  its  officers  to  crush  any  and  a    opposiUon 
either  to  themselves  or  to  the  policies  for  which  they  stood.   At  times 
hose  in    ontrol  of  the  Council's  affairs  did  not  hesitate  to  break  up 
'union  if  perchance  it  evidenced  any  inclination  to  oppose  those  in 
power.   Organizations  were  ousted  from  the  local  counc,    and  theu^ 
Tmbers  declared  to  be  "unfair"  even  though  duly  affil-^ed  w^th 
their  international  union  and  in  good  standing  therewith.   At  time 
llval  union  was  formed  for  the  purpose  of  coercing  --  rec^  -Uam 
organization  into  accepting  the  rulings  of  the  Council.   After  the  old 
union  had  been  completely  coerced,  the  Council  at  times  ordered  the 
rLl  organization  to  be  dissolved  and  its  members  to  apply  for  ad- 
r^ssion  in  the  old  union.   Initiation  fees  had  to  be  paid  over  again, 
Td  at  times  it  happened  that  the  members  of  the  rival  union  who 
were  the  means  of  coercing  the  old  organization,  were  demed  admis- 
sion  to  the  latter.^ 

.     •    .         r.(  ih^  «hnve  is  to  be  found  in  connection  with  the  plasterers' 
1  An  instance  of  ^^e  ^^^^^  ^^  ^^  ^^^  ,j  ,^,3  ^  jurisdictional  dispute  arose 

union,  No^  '\^°'if^^^;^„\CZ':,,:tyL  settled  on  January  t6,  x,u; 
tr:.:p.as"t:r^^"  un™o.  I^  withdrew  i^s  demands^d  was  .^.ate^^m 
the  Buirdin.  Trades  Council     Those  P'f  "ers  who  had  );'"f  \ocal  ^ 
were  then  informed  that  if  they  desired  to«»*^t  their  tjade  a 
in  San  Francisco,  it  would  be  necessary  for  them  to  P^V  »"  ™^™  ^e  cited, 
and  join  Local  No.  66.   Other  instances  of  similar  character  might 


114 


«ii 


-Wi 


•r^ 


I       f 


If 

% 
I 


I 

if'* 
** 


480       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Another  cause  of  the  effectiveness  of  the  Building  Trades  Council 
was  the  permanency  of  its  officials.  It  had  retained  the  same  presi- 
dent since  its  inception.  The  tenure  of  other  officials  had  also  ex- 
tended over  comparatively  long  periods  of  time.  In  the  case  of  the 
Labor  Council,  on  the  other  hand,  no  men  or  set  of  men  had  ever 
dominated  its  policies  for  any  considerable  length  of  time.  Its  affairs, 
as  a  rule,  had  been  most  democratically  managed.  Permanency  in 
office  in  the  Building  Trades  Council  had  been  made  possible  in  part 
by  such  means  as  organizing  unions  to  secure  votes,  dissolving  ob- 
streperous unions,  hounding  those  men  who  had  opposed  or  objected 
to  the  policies  of  the  Council's  officers,^  interfering,  sometimes  by 
the  use  of  "strong  arm"  methods,  with  the  election  of  the  officers 
and  delegates  of  local  unions,  manipulating  the  number  of  delegates 
allotted  each  union  by  the  rules  of  the  Building  Trades  Department 
of  the  American  Federation  of  Labor  so  as  to  give  more  than  the 
allotted  number  of  delegates  in  the  Building  Trades  Council  to 
favored  unions,  and  by  similar  methods.  While  the  means  employed 
to  attain  the  end  desired  may  be  seriously  questioned,  yet  it  must  be 
admitted  that  the  permanency  in  office  thereby  secured  made  possible 
the  pursuance  of  a  consistent  set  of  policies  which  in  its  turn  made 
for  the  dominance  and  strength  of  the  Building  Trades  Council  in 
the  local  field. 

The  Council  also  reserved  to  itself  the  right  to  refuse  at  any' time 
to  seat  delegates  sent  to  it  by  any  affiliated  union  if  those  delegates 
or  any  of  them  were  objectionable  for  any  cause  whatsoever  to  the 
delegates  already  seated  in  the  Council.  By  this  means  it  was  usually 
able  to  keep  out  so-called  disturbers  or  objectors.-  The  Council  also 
reserved  to  itself  the  right  to  expel  any  delegate  or  to  take  away  his 
vote  if  at  any  time  it  desired  to  do  so.  By  such  methods  a  more  uni- 
fied and  cohesive  working  body  was  secured  whose  time  was  not 
largely  taken  up  with  petty  janglings  and  quarrels  as  would  otherwise 
have  been  the  case. 

^  By  making  it  impossible  for  them  to  obtain  or  retain  employment,  by  filing 
false  charges  against  them  before  the  union  or  the  Building  Trades  Council, 
and  by  various  other  means. 

2  Section  2  of  Article  II  of  the  constitution  of  the  Council  provided  that 
"  The  Council,  however,  reserves  the  right  to  object  to  the  seating  of  any,  or 
all,  delegates  who,  in  its  judgment,  are  considered  undesirable  or  detrimental 
to  the  best  interests  of  the  Council." 


THE  SAN  FRANCISCO  BUILDING  TRADES         481 

The  Council  was  effective  also  because  it  enforced  its  decisions  and 
awards.    It  compelled  its  constituent  unions  to  abide  by  its  mandates. 
The  Council  agreed  to  affiliate  with  the  Building  Trades  Depart- 
ment of  the  American  Federation  of  Labor  only  upon  condition  that 
it  be  permitted  to  retain  its  autonomy  and  also  its  power  over  its 
constituent  unions.    There  had  been  fewer  strikes  in  the  building 
trades  in  San  Francisco  than  elsewhere  owing  to  the  rigorous  methods 
and  policies  pursued  by  the  Council  and  to  its  ability  to  compel  the 
affiliated  unions  to  respect  and  abide  by  its  decisions.   All  demands 
for  increased  wages,  shorter  hours,  and  better  conditions  of  employ- 
ment had  first  to  be  approved  by  the  Building  Trades  Council.    Its 
decision  in  the  matter  was  final.    There  could  be  no  appeal.   Any 
union  which  refused  to  obey  the  decision  of  the  Council  was  ousted 
from  that  body  and  declared  to  be  unfair.   A  rival  union  might  then 
be  formed  to  take  the  places  of  the  members  of  the  obstreperous 
organization,  and  the  latter  would  usually  be  whipped  into  line. 
The  Council  had  always  followed  this  policy  of  riding  roughshod  over 
all  opposition  within  its  ranks  and  at  times  attempted,  though  not 
so  successfully,  to  pursue  the  same  policy  in  its  dealings  with  other 
branches  of  organized  labor  in  San   Francisco.     By  the  methods 
described  the  Council  was  able  to  prevent  impossible  demands  being 
made  by  the  unions  affiliated  with  it.  It  watched  matters  very  closely 
in  every  part  of  the  local  building-trades  field  and  thus  prevented 
many  labor  disputes  that  would  otherwise  have  occurred.    Whenever 
labor  controversies  arose  the  Council  made  every  effort  to  adjust 
them  by  means  of  arbitration  or  otherwise.   Although  the  constitu- 
tion and  by-laws  of  the  Council  made  no  provision  for  either  con- 
ciliation or  arbitration,  it  frequently  employed  both  methods  for  the 
purpose  of  maintaining  industrial  peace. 

The  Labor  Council  also  believed  in,  and  always  attempted  to  in- 
duce its  members  to  adopt,  conciliation  or  arbitration  in  all  labor 
disputes.  In  all  matters  it  tried  to  play  fair  with  the  employers. 
It  too  was  a  powerful  agency  for  industrial  peace. 

As  has  been  noted  above,  the  Building  Trades  Council  as  a  central 
organization,  as  well  as  its  affiliated  unions,  did  not  stand  committed 
in  any  degree  to  a  scheme  of  collective  bargaining  based  on  trade 
agreements.  Its  constitution  and  by-laws  contained  no  provisions 
relative  to  the  drafting  of  trade  agreements  or  their  use  by  either  the 


il 


m 


i 


H 


482       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Council  or  its  member  unions.  The  officials  of  the  Council  claimed 
that  it  and  its  member  unions  should  be  free  and  unhindered  in  their 
right  to  change  wages,  hours,  and  conditions  of  employment  when- 
ever they  desired  to  do  so,  and  that  a  system  of  trade  agreements 
would  make  the  exercise  of  that  prerogative  impossible. 

Nothing  so  clearly  shows  the  general  attitude  of  the  Council 
towards  this  matter  as  the  testimony  of  its  president,  Mr.  P.  H. 
McCarthy,  given  before  the  U.  S.  Commission  on  Industrial  Rela- 
tions in  San  Francisco,  September  i,  19 14.  Upon  being  questioned 
by  Commissioner  John  R.  Commons,  he  declared: 

We  do  not  believe  in  those  signed  agreements  that  have  possession 
of  you  Eastern  gentlemen.  We  believe  they  are  contrary  to  certain 
conditions  within  the  confines  of  this  country.  We  believe  that  they 
act  as  incentives  to  employers  and  employees  alike,  and  create 
trouble  at  about  the  time  of  the  expiration  of  the  agreement.  Every- 
body knows  that  they  do.^ 

Time  limits  are  very  dangerous.  Time  limits  act  as  incentives  to 
both  parties  to  make  certain  demands.- 

We  will  not  sign  time  agreements,  and  we  believe  time  agreements 
are  vicious,  and  we  are  not  engaging  in  anything  that  is  vicious.^ 

As  a  consequence  of  this  policy,  the  Building  Trades  Council 
was  a  party  to  but  two  agreements  at  the  time  covered  by  this  study 
(191 5).  One  agreement,  that  with  the  Planing  Mill  Owners'  Asso- 
ciation, had  been  drawn  up  as  early  as  February,  1901,  and  had  been 
amended  and  readopted  from  year  to  year.  It  had  brought  to  con- 
clusion a  very  serious  labor  struggle  waged  for  the  purpose  of  pre- 
venting the  use  of  imported  unfair  lumber.  The  other  agreement 
was  that  which  had  been  drawn  up  with  the  Master  Painters'  and 
Decorators'  Association  in  June,  19 14,  following  a  strike  of  the  jour- 
neymen painters  for  higher  wages.    Both  agreements  were  the  result 

^  U.  S.  Commission  on  Industrial  Relations,  Final  Report  and  Testimony, 
Vol.  VI,  p.  5212. 

-Ibid.  p.  521 1. 

^Ibid.  p.  5212.  In  May,  ioi7,  however,  the  Building  Trades  Council  sanc- 
tioned an  agreement  drawn  up  in  conference  between  representatives  of  the 
Master  Painters'  and  Decorators'  Association  and  the  local  District  Council  of 
Painters.  This  is  the  first  instance  of  collective  bargaining  based  on  a  trade 
agreement  that  has  been  recorded  in  the  building-trades  world  for  many  years 
past;  another  agreement  of  similar  character  was  entered  into  by  these  two 
parties  and  approved  by  the  Building  Trades  Council  in  August,  1906. 


THE  SAN  FRANCISCO  BUILDING  TRADES         483 

of  arbitration  proceedings.  As  President  McCarthy  declared  before 
the  U.  S.  Commission  on  Industrial  Relations,  "Whenever  the  board 
of  arbitration  is  called  in,  then  we  request  agreements  and  agreements 
are  signed  up."    Otherwise  agreements  were  not  resorted  to. 

The  Building  Trades  Council  thus  stood  committed  to  a  policy 
antagonistic  to  the  use  of  trade  agreements  except  in  those  cases 
where  arbitration  proceedings  were  necessary  to  settle  a  controversy 
between  employers  and  employees.^ 

The    building-trades    employers    of    San    Francisco    were    very 
thoroughly  organized  into  various  associations  representmg  the  m- 
terests  of  particular  groups  of  contractors.    Thus  in  1915  there  were 
the  General  Contractors'  Association,  the  San  Francisco  Lumbermen  s 
Club  the  San  Francisco  Planing  Mill  Owners'  Association,  the  Master 
Housesmiths'  Association,  the  Lighting  Fixtures  Club  of  San  Fran- 
cisco, the  Master  Roofers'  and  Manufacturers'  Association,  the  Con- 
crete' Contractors'  Association,  the  Furniture  and  Carpet  Trades' 
Association,  the  Sheet  Metal  Contractors'  Association,  the  Master 
Painters'  and  Decorators'  Association,  the  Erectors'  Association  of 
California    the  Cabinet  Manufacturers'  Association  of  Califorma, 
the  Masons'  and  Builders'  Association  of  San  Francisco,  and  the 
California  Association  of  Electrical  Contractors  and   Dealers.    At 
the  time  this  survey  was  made  (191 5)  all  but  the  last  two  associa- 
tions were  affiliated  with  the  Building  Trades  Employers'  Associa- 
tion of  San  Francisco.- 

Neither  the  Building  Trades  Employers'  Association  nor  any  ot 
the  above-mentioned  associations  engaged  in  collective  bargaining 
based  on  a  system  of  trade  agreements.  They  had  been  formed 
primarily  for  trade  purposes.  At  times  a  meeting  might  be  held 
in  conference  with  representatives  of  a  local  union  or  of  the  Building 
Trades  Council,  but  this  would  usually  occur  after  the  employers 
had  been  notified  that  a  new  wage  scale  was  to  go  into  effect  or  that 
a  certain  firm  had  been  declared  to  be  unfair,  or  that  a  labor  dispute 
was  threatened  or  had  taken  place,  or  after  something  else  of  a  similar 
nature  had  occurred  or  was  about  to  occur.    There  were  a  few  cases 

1  Commissioner  Commons:  ^^Your  method  here  is,  you  don't  make  written 

agreements  with  the  employer  ? "  „       j  •    » 

Mr  McCarthy:    "Unless  where  arbitration  boards  are  allowed  in. 

2  The  Building  Trades  Employers'  Association  disbanded  in   191 7- 


■  t. 


I  i 

i! 


!    t| 


484       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  agreements'  being  signed  between  the  individual  employer  and  the 
union,  but  such  a  practice  was  the  great  exception  rather  than  the 
general  rule.  Thus  in  191 5  the  Bricklayers'  Union  had  what  was 
known  as  a  "reciprocal  agreement,"  which  fair  contracting  masons 
and  builders  signed  as  individual  firms.  Undoubtedly  there  were  a 
few  other  scattering  individual  agreements  which  my  investigation 
failed  to  disclose,  but  they  were  found  so  seldom  among  the  building- 
trades  unions  as  not  to  be  considered  of  any  consequence  in  determm- 
ing  the  characteristics  of  the  activities  of  the  particular  group  of 
trades  under  discussion. 

The  various  employers'  associations  in  the  building  trades  did  not 
meet  with  the  union  or  unions  concerned  or  with  representatives  of 
the  Building  Trades  Council  to  discuss  wages,  hours,  or  conditions 
of  employment  unless  objections  to  the  proposed  scale  of  the  union 
were  made  by  the  employers.  :Mr.  Grant  Fee,  president  of  the 
Building  Trades  Employers'  Association  of  San  Francisco,  in  testi- 
fying before  the  United  States  Commission  on  Industrial  Relations 
in  San  Francisco,  September  i,  19 14,  declared: 

There  is  no  collective  bargaining  in  this  city,  as  I  understand  the 
term.  The  system  in  vogue  in  this  city  is :  The  unions  pass  a  so- 
called  law  raising  the  scale  of  wages  or  changing  the  working  condi- 
tions ;  that  is  referred  to  the  Building  Trades  Council  for  their 
approval;  if  approved  by  the  Building  Trades  Council,  it  is  put  in 
force ;  sometimes  notice  is  given  and  again  no  notice  is  given  in  spite 
of  the  fact  that  the  Building  Trades  Council  say  that  one  of  their 
laws  is  that  a  ninety  days'  notice  must  be  given  before  a  change  in 
wage  or  working  conditions  is  put  into  effect.  The  employer  has  no 
voice  whatever  in  making  the  above-stated  rules  ;  the  employer's  part 
consists  in  making  what  resistance  he  can  ;  this  resistance  has  met 
with  no  degree  of  success,  excepting  cases  of  housesmiths'  trouble 
in  the  matter  of  eight-hour  day  in  structural  shops.  Collective  bar- 
gaining, as  I  understand  the  term,  presumes  discussion  and  consul- 
tation by  the  parties  concerned  before  agreements  are  made.  Here 
there  is  no  such  discussion.  The  so-called  agreement  is  the  ultimatum 
of  one  party  which  the  other  party  has  no  choice  but  to  accept.^ 

1  In  a  supplementary  brief  filed  by  Mr.  Fee  with  that  Commission  he  de- 
clared that  "  they  recognize  their  power,  wielded  by  a  collective  demand,  but 
seldom,  if  ever,  deal  with  any  but  individual  employer  unless  forced  to  do  so 
by  that  employer's  referring  the  demand  made  upon  him  to  the  employers'  or- 
ganization. And  this  in  spite  of  the  fact  that  the  union  well  knows  that  the 
employers  have  an  active  organization." 


THE  SAN  FRANCISCO  BUILDING  TRADES         485 

Mr.  McCarthy,  at  the  same  hearing,  described  in  the  following 
manner  the  methods  used  by  the  building-trades  unions  in  settling 
conditions  of  employment: 

Mr.  McCarthy.   As  to  the  wage  ? 

Commissioner  Weinstock.  Take  a  hypothetical  case.  Suppose 
the  carpenters  would  decide  that  they  are  entitled  to  an  increase,  say 
10  per  cent  of  the  present  wage. 

Mr.  McCarthy.    Yes.  .    . 

Commissioner  Weinstock.    Will  you  explain  to  the  Commission 

what  would  be  the  method? 

Mr.  McCarthy.  The  carpenters  would  take  the  matter  up  m 
their  district  council,  which  embraces  all  of  the  carpenters  within  the 
confines  of  the  transbay  cities.  They  would  then  send  that  out 
to  a  vote  of  the  carpenters.  That  vote  would  be  tabulated  and  sent 
in  to  the  district  council.  If  a  majority,  or  two  thirds,  or  whatever 
this  vote  did  run,  the  action  called  for  would  be  tabulated.  Then  it 
would  be  by  the  district  council  of  carpenters  approved  and  sent,  if 
occasion  required,  to  the  general  office  in  Indianapolis  for  approval ; 
but  if  it  did  not,  that  would  be  waived — in  either  event,  if  it  was 
sent  first  to  Indianapolis  it  would  then  go  to  the  Building  Trades 
Council  of  this  city  with  which  the  carpenters  are  affiliated,  the  Build- 
ing Trades  Council  of  Alameda  County,  and  then  the  Building 
Trades  Council  would  take  the  matter  up  with  the  General  Con- 
tractors' Association,  the  builders'  exchange,  with  which  some  build- 
ers doing  carpenter  work  may  be  associated.  We  also  communicate 
with  every  independent  contractor  in  this  city  who  are^  business 
agents,  and  these  men  would  be  interviewed  in  that  manner  and  the 
subject  drawn  to  their  attention. 

Commissioner  Weinstock.    .  .  .  You  would  send  them  an  official 

communication  ? 

Mr.  McCarthy.  We  sure  v/ould,  because  they  have  an  association, 
and  [in  the  case  of]  all  of  those  institutions  you  will  find  that  [there 
are]  men  in  the  same  line  [who]  are  not  affiliated ;  those  men  also 
have  a  right  to  know  and  a  right  to  pass  upon  a  change  of  that  kind, 
and  as  a  result  our  business  agent  takes  the  matter  up  with  them. 
...         •         •         •         •         •         •         •         •         • 

Commissioner  Weinstock.    The  point  is  not  clear  to  me  yet. 

Mr.  McCarthy.   What  is  it  that  is  not  clear  now  ? 

Commissioner  Weinstock.  Whether  you  say  to  the  contractor — 
whether  you  simply  inform  him  of  your  conclusions,  or  whether  you 
leave  it  a  debatable  question. 

1  Evidently  an  error  of  the  stenographer.  Presumably  "who  are"  should 
read  "through  our." 


■'       M 


\l 


ii  * 


tl 


486       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Mr.  McCarthy.   We  inform  him  as  to  what  action  we  have  taken, 

of  course. 

Commissioner  Weinstock.    That  you  have  decided  there  shall 

be  a  certain — 

Mr.  McCarthy.  No  sir ;  we  haven't  done  anything  of  the  kind. 
Don't  get  away  with  that.  We  have  decided  what  we  shall  ask  for, 
and  we  are  now  drawing  his  attention  to  it,  and  those  who  are  not 
affiliated  with  us,  to  the  end  that  if  he  feels  the  need  of  discussion 
we  will  so  take  it  up  with  him  and  discuss  it  with  him.  Mr.  Fee  was 
not  correct  when  he  stated  that  we  made  laws  for  them.  He  knew 
that  he  was  not  telling  the  truth. 

Commissioner  Weinstock.  Then  I  am  to  understand  that  it  is 
left  a  debatable  question? 

Mr.  McCarthy.  Of  course  it  is  a  debatable  question.  There  is 
nothing  settled  until  it  is  settled  by  both  parties. 

In  responding  earlier  in  his  testimony  to  a  question  asked  by 
Commissioner  Commons,  Mr.  McCarthy  declared  that  there  was  but 
one  agreement  existing  between  the  Building  Trades  Council  and 
the  San  Francisco  Planing  Mill  Owners'  Association.  The  following 
discussion  then  took  place : 

Commissioner  Commons.  So  that  all  other  agreements  are 
simply  rules  or  plans  or  schedules,  and  so  forth,  submitted  to  them 
and  they  sign  them  individually  ? 

Mr.  McCarthy.  No.  They  are  entered  into  by  mutual  consent. 
As  outlined  by  myself  here  in  the  beginning,  to  wit:  ...  [the  union 
adopts  a  schedule],  it  is  passed  up  to  the  Building  Trades  Council, 
referred  by  the  Building  Trades  Council  to  the  executive  board,  by 
the  executive  board  it  is  referred  to  the  representative  in  the  field, 
and  those  representatives  interview  each  and  every  individual  in  that 
department,  get  an  expression  of  opinion  from  them,  and  only  in  two 
instances  during  the  past  fifteen  years  have  a  majority  of  those  dis- 
sented. .  .  .  When  they  get  a  majority  of  employers  in  favor  thereof, 
at  a  regular  meeting,  they  decide  accordingly,  and  so  notify  the 

employers. 

Commissioner  Commons.  As  a  matter  of  fact,  you  recognize  that 
that  is  not  what  is  usually  called  collective  bargaining  ? 

Mr.  McCarthy.  As  a  matter  of  fact.  Professor,  I  recognize  that 
that  is  what  is  collective  bargaining. 

Commissioner  Commons.    It  is  collective  bargaining  on  your  side. 

Mr.  McCarthy.   On  every  side ;  on  my  side  and  on  their  side. 

Commissioner  Commons.   And  individually  on  their  side? 


THE  SAN  FRANCISCO  BUILDING  TRADES         487 

Mr.  McCarthy.  No.  You  are  mistaken  there.  Professor.  They 
have  their  association.     You  are  in  error  there.     They  take  it  to 

their  association.  . 

Commissioner  Commons.  Do  the  representatives  of  your  asso- 
ciation meet  the  representatives  of  their  association  and  jointly  agree 
upon  all  questions— wages,  hours,  and  conditions? 

Mr.  McCarthy.     ...  you  haven't  followed  me. 

Commissioner  Commons.   I  thought  I  did. 

Mr  McCarthy.  .  .  .  When  the  Council  takes  this  [step],  it 
becom'es  the  law,  and  then  it  is  a  subject  of  discussion,  and  not 

before.  ...  ■,  i         :> 

Commissioner  Commons.  You  do  meet  the  employer  f 
Mr.  McCarthy.    Absolutely.    If  there  is  any  objection,  then  we 

meet.    That  is  collective  bargaining,  just  and  correct. 

It  is  clearly  evident,  not  only  from  the  testimony  presented 
before  the  Commission  on  Industrial  Relations  by  Mr.  Fee  and 
Mr.  McCarthy  but  also  from  data  secured  by  personal  investigation, 
that  collective  bargaining  based  upon  trade  agreements,  and  that 
trade  agreements  themselves  except  in  case  of  disputed  points  decided 
by  an  arbitration  board,  played  no  part  in  the  activities  of  the 

building-trades  unions. 

Testimony  before  the  Commission  on  Industrial  Relations  as  well 
as  personal  interviews  also  disclosed  the  fact  that  there  was  wide- 
spread complaint  among  the  building-trades  employers  relative  to 
the  arbitrary  methods  pursued  by  the  building-trades  unions  in 
connection  with  such  matters  as  would  customarily  form  the  basis 
for  a  scheme  of  collective  bargaining.  It  may  be  that  the  arbitrary 
methods  employed  by  the  Building  Trades  Council  made  possible  its 
unquestioned  success  in  securing  higher  wages,  shorter  hours,  and 
better  conditions  of  employment  for  its  members  than  otherwise 
might  exist.  But  the  fact  should  never  be  overlooked  that  the  con- 
tinued arbitrary  exercise  of  authority  and  power  inevitably  causes 
dissatisfaction  and  complaint. 

Although  the  Building  Trades  Council  had  always  opposed  the 
adoption  of  trade  agreements  except  in  case  of  a  disputed  point 
settled  by  means  of  arbitration,  nevertheless  when  agreements  had 
been  made  necessary,  the  Council  had  uniformly  lived  up  to  the 
conditions  imposed  and  had  compelled  its  member  unions  to  do 


488       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

likewise.^  The  ability  of  the  Council  to  enforce  compliance  with  the 
terms  of  such  agreements  had  been  due  solely  to  the  exercise  of  this 
same  arbitrary  and  dictatorial  power  above  discussed.  Without  it 
the  Council  would  have  been  unable  to  have  enforced  obedience  to 
its  mandates  and  would  thus  have  degenerated  into  an  ineffective, 
uninfluential  organization,  not  unlike  the  other  trade  councils  with 
which  other  unions  of  the  Labor  Council  were  affiliated. 

Inasmuch  as  collective  bargaining  and  trade  agreements  played 
such  an  unimportant  part  in  the  life  and  activities  of  the  Building 
Trades  Council,  no  discussion  of  the  terms  of  the  few  agreements 
that  were  in  force  in  1915  is  deemed  necessary. 


Ira  B.  Cross 


University  of  Caltfornu 


1  In  reciting  the  events  that  led  up  to  the  drafting  of  the  agreement  in  the 
painters'  controversy  in  1914,  Mr.  F.  W.  Kellogg,  one  of  the  arbitrators,  made 
the  following  significant  statement  before  the  Commission  on  Industrial 
Relations  at  San  Francisco,  September  5,  1914  : 

"Mr.  McDonald  of  the  Building  Trades  Council  made  a  very  fair  statement 
at  our  meeting  on  May  12.  And  he  challenged  the  employers'  association 
[Master  Painters'  and  Decorators'  Association]  to  point  to  a  single  instance 
where  they  [the  building-trades  unions]  had  broken  an  agreement  after  they 
had  entered  into  it.  There  was  one  or  two  answers  to  that  that  claimed  that 
they  had  broken  their  agreements  in  a  minor  way,  but  the  final  admission  was 
that  the  Building  Trades  Council  had  kept  its  agreements  in  this  city." 
(Commission   on   Industrial   Relations,  Final  Report   and  Testimony,  Vol.  6, 

p.  5481-) 


XXXII 
PATTERNMAKERS'  LOCAL  AGREEMENTS,  CHICAGO' 

THE  methods  of  bargaining  employed  by  the  Pattern  Makers' 
Association  of  Chicago  are  in  many  respects  unique  in  the  field 
of  trade-union  experience.  It  is  customary  to  look  upon  a  trade-union 
as  an  association  that  exists  for  the  purpose  of  securmg  an  agree- 
ment with  employers  through  collective  action.  The  terms  of  such 
agreements  are  ordinarily  reduced  to  a  written  contract  which  governs 
the  conditions  of  service  in  respect  to  hours,  wages,  etc.  fox  a  specified 

period  of  time.  ,1,        ^      ^ 

While  the  Pattern  Makers'  Association  has  a  scale,  all  contracts 
are  made  with  individual  employers  and  the  agreements  are  always 
verbal  The  officials  of  the  Chicago  association  claim  that  they  have 
had  but  one  strike  in  fourteen  years,  and  that  this  dispute  was 
in  reality  a  lockout  rather  than  a  strike.  The  strength  of  this 
organization  lies  in  three  things : 

1  Patternmaking  is  highly  skilled  work. 

2  The  small  number  of  men  ordinarily  employed  in  a  shop.  Four 
or  five  men  is  the  usual  number  found  in  a  shop,  although  some  shops 
in  the  city  employ  as  many  as  sixteen  or  eighteen  men.  The  smaller 
number  of  men  usually  involved  in  a  grievance  renders  the  financial 
strain  of  maintaining  these  men  till  the  dispute  is  adjusted  less 
severe  than  for  most  unions.  The  largest  jobbing  shop  in  Chicago 
is  one  that  the  union  itself  assisted  in  establishing.  The  importance 
of  this  shop  to  the  successful  operation  of  the  methods  employed 
by  this  union  will  be  described  later. 

3  Because  the  patternmakers  are  a  small,  compact  group  of 
skilled  workmen,  organization  can  be  made  more  easily  effective. 
The  officers  of  the  union  estimate  that  there  are  about  five  hundred 
patternmakers  in  the  city  of  Chicago  and  that  95  per  cent  of  these 
are  members  of  the  union.   On  account  of  these  conditions,  and  by 

iFrom  Annals,  Vol.  LXIX  (1917),  PP-  208-213. 

489 


490       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

means  of  apprenticeship  and  other  rules,  the  union  is  able  to  maintain 
a  more  complete  control  over  the  supply  of  labor  and  the  conditions 
of  employment  than  is  possible  by  many  larger  organizations. 

In  negotiating  with  employers  the  local  association  exercises  a 
large  degree  of  freedom.  The  laws  of  the  Pattern  Makers'  League, 
the  national  union  in  this  industry,  do  set  some  limits  on  the  action 
of  local  associations  affiliated  with  the  national  union,  but  these 
rules  do  not  place  a  very  strict  limitation  on  local  activity.  The 
most  important  rules  of  the  League  are  those  governing  apprentice- 
ship,^ those  prohibiting  members  from  working  on  piece,  premium, 
bonus,  or  contract  work,^  and  a  declaration  in  opposition  to  strikes 
and  favorable  to  arbitration  and  conciliation  as  the  best  methods  oi 
adjusting  grievances.**  The  rule  governing  the  procedure  in  the  case 
of  a  grievance  is  as  follows :  The  local  association  must,  at  a  specially 
called  meeting,  decide  by  a  two-thirds  vote  of  the  members  present 
to  lay  their  case  before  the  employers  involved.  The  Association 
must  then  notify  the  general  president,  who,  either  personally  or  some 
representative  of  the  League  delegated  by  him,  proceeds  to  the  scene 
of  the  controversy  and  endeavors,  in  conjunction  with  the  local  exec- 
utive committee,  to  effect  a  settlement.  Failing  in  this,  a  local  may 
resort  to  a  strike.*  This  rule  of  the  League  is  of  slight  consequence 
as  a  means  of  restricting  independent  local  action.  The  only  advan- 
tage that  would  accrue  to  the  local  by  complying  with  the  rule  would 
be  the  strike  benefits  that  the  members  would  receive  from  the  funds 
of  the  national  body.  As  the  number  of  members  involved  in  any  one 
dispute  is  so  small,  this  rule  can  have  little  effect  on  the  determination 
of  local  policy,  even  in  times  of  a  dispute.  The  local  could  carry  the 
financial  burden  of  a  dispute,  in  case  it  saw  fit  to  do  so.  However, 
as  stated  above,  it  is  contrary  to  the  policy  of  the  Chicago  association 
to  engage  in  strikes.  The  League  has  another  rule,  prohibiting  over- 
time *' except  in  cases  of  absolute  necessity,"'  which  means  prac- 
tically nothing.  There  are  no  restrictions  on  local  action  in  respect 
to  wages  and  hours. 

The  wage  scale  of  the  Chicago  Pattern  Makers'  Association  varies 
for  different  kinds  of  shops.    Two  principal  kinds  of  shops  employ 

^Constitution,  Pattern  Makers'  League  (1913),  p.  19. 
^Ibid.  p.  22.  ^Ibid.  p.  17. 

^Ibid.  p.  7.  5/i,irf.  p.  22. 


PATTERNMAKERS'  LOCAL  AGREEMENTS  49i 

patternmakers:  First,  the  general  manufacturing  plant  that  main- 
tains its  own  pattern  shop.  Some  of  these  shops  in  Chicago  may 
employ  only  two  or  three  men,  while  others  may  have  as  many  as 
fourteen  to  sixteen  men.  Second,  the  jobbing  houses.  Many  manu- 
facturing plants  find  it  more  economical  to  let  contracts  for  their 
patterns  rather  than  to  attempt  to  run  a  shop  of  their  own.  The  wage 
scale  in  the  general  manufacturing  plants  is  50  cents  per  hour.  In 
some  of  the  jobbing  shops  the  scale  is  as  high  as  60  cents  per  hour.* 
Lack  of  uniformity  is  found  likewise  in  regard  to  the  hours  of 
work.  Some  plants  work  as  few  as  eight  hours  per  day,  while  others 
work  eight  and  one-half  and  some  as  many  as  nine  hours  per  day. 
The  officers  of  the  union  stated  that  the  patternmaking  department 
of  the  Illinois  Steel  plant  works  ten  hours  per  day,  but  that  this  is 
a  nonunion  shop  and  the  conditions  here  are  unusual. 

The  Chicago  Pattern  Makers'  Association  has  a  peculiar  method 
of  controlling  the  wage  scale  and  conditions  of  employment.  For 
many  years,  when  new  demands  were  made,  the  men  were  told  by 
the  employers  that  the  business  could  not  stand  the  added  expense. 
The  union  officers  had  no  positive  evidence  as  to  the  accuracy  of  this 
statement.  At  the  present  time,  however,  the  officials  of  the  union 
can  know  with  reasonable  accuracy  what  the  cost  of  a  patternmaking 
department  should  be  to  the  employer.  This  information  is  obtained 
through  the  experience  that  the  union  has  gained  from  its  relations 
with  the  American  Pattern  and  Model  Company. 

This  Company  is  incorporated  under  the  laws  of  Illinois  and  has 
been  in  operation  now  for  a  period  of  six  years.  The  stockholders  are 
all  members  of  the  Chicago  Pattern  Makers'  Association.  The  Com- 
pany was  formed  by  a  subscription  of  shares  on  the  following  terms : 
The  shares  were  issued  in  denominations  of  $50.  Any  member  of  the 
Pattern  Makers'  Association  desiring  to  take  out  a  share  of  stock  in 
the  Company  could  do  so  by  the  payment  of  S5  down  and  $1  per 
week  until  the  face  value  of  the  share  had  been  paid  in.  In  this  way 
the  plant  became  a  cooperative  undertaking,  owned  and  managed  by 
members  of  the  Pattern  Makers'  Association.  This  Company  is  in 
direct  competition  with  all  other  patternmaking  establishments  in 
Chicago.    In  fact,  it  is  claimed  that  this  is  the  largest  jobbing  plant 

1  This  scale  does  not  include  the  wages  paid  in  the  American  Pattern  and 
Model  Company's  shop,  which  is  owned  by  members  of  the  union. 


i 


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i 


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:\i- 


It 


i! 


1 


492        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

in  the  city,  as  it  employs  between  thirty  and  forty  men.  The  shop 
is  run  with  strictly  union  labor,  which  is  paid  the  best  wages  and  is 
given  the  shortest  hours  possible.  The  latest  safety  devices  are  used, 
and  the  general  conditions  of  employment  are  as  satisfactory  as  they 
can  be  made.  The  wage  scale  in  this  shop  is  62  J/2  and  65  cents  per 
hour,  according  to  the  grade  of  work,  for  an  eight-hour  day,  with  a 
half  holiday  on  Saturdays.  It  is  claimed  that  both  wages  and  hours 
are  more  favorable  than  in  any  other  shop  in  the  city.^ 

While  this  shop  is  a  private  corporation,  the  peculiar  relation  of 
the  union  to  its  management  gives  the  union  a  decided  advantage  in 
its  bargaining  with  employers  in  other  shops  throughout  the  city. 
These  advantages  may  be  summarized  as  follows: 

1.  Reasonably  accurate  information  concerning  manufacturing  can 
be  obtained.  Should  an  employer  state  that  he  could  not  afford  to 
meet  the  demands  of  the  men,  the  officers  of  the  union  would  be 
in  a  position  to  know  whether  or  not  the  employer  was  making  a 
correct  statement. 

2 .  Should  the  employer  refuse  to  accede  to  the  demands,  the  men 
could  be  put  to  work  in  the  shop  of  the  American  Pattern  and  Model 
Company.  From  the  nature  of  this  trade  it  frequently  happens  that 
these  same  journeymen  can  go  to  the  firm  for  whom  they  have  been 
working  and  secure  a  contract  for  the  pattern  work  of  this  plant. 
The  firm  has  known  the  work  of  this  journeyman,  and,  if  the  firm  was 
satisfied,  very  often  the  work  will  follow  the  journeyman.  In  this 
way  the  journeymen  may,  in  case  of  a  dispute,  actually  increase  the 
work  of  the  American  Pattern  and  Model  Company.  While  it  is 
true  that  the  space  controlled  by  this  firm  is  limited,  the  officials  of 
the  union  point  to  the  possibility,  although  it  has  never  been  done, 
of  renting  additional  space  and  of  putting  the  men  to  work  if  con- 
ditions in  the  industry  should  warrant  it.  Even  if  the  men  were  not 
put  to  work,  they  could  be  put  on  strike  benefits.  Whichever  way  the 
matter  is  handled,  the  effect  on  the  employer  is  the  same,  for  since 
the  union  has  so  large  control  over  the  skilled  patternmakers,  the 
employer  is  practically  forced  to  get  any  additional  workmen  through 

^  The  American  Pattern  and  Model  Company  has  constructed  a  new  build- 
ing at  a  cost  of  $20,000.  This  new  building  has  greatly  increased  the  space  and 
efficiency  of  its  work.  No  dividends  have  been  declared  to  date,  as  all  of  the 
earnmgs  have  been  put  back  into  the  plant  and  equipment. 


PATTERNMAKERS'  LOCAL  AGREEMENTS  493 

the  union.    New  men  will  not  be  furnished  except  at  the  rates  de- 
manded.   This  explains  why  it  is  not  necessary  for  the  patternmakers 

to  strike. 

The  foregoing  method  can  be  used  even  though  there  is  no  dispute. 
Whenever  the  union  decides  that  any  particular  shop  is  paying  less, 
or  working  longer  hours,  than  it  should,  the  men  may  be  withdrawn 
and  put  to  work  in  their  own  shop.  When  the  employer  calls  for  more 
men,  he  is  informed  that  the  conditions  as  to  wages  or  hours  in  his 
shop  are  not  satisfactory.  He  is  told  that  if  he  expects  to  hold  his 
men,  it  will  be  necessary  to  pay  a  little  more  or  to  give  his  men 
better  conditions.  In  this  way  the  union  has  used  its  relations  with 
the  American  Pattern  and  Model  Company  to  improve  working 
conditions  for  its  members. 

The  relation  of  the  union  to  this  Company  gives  the  union  a  line 
upon  another  problem  in  the  industry.    For  a  long  time  one  of  the 
principal  menaces  to  standard  conditions  was   the  small  pattern- 
maker who  would  underbid  the  union  scale  in  order  to  get  a  job. 
Having  secured  the  contract,  he  would  work  long  hours,  and  if  he 
required  help  on  the  job  he  would  pay  the  lowest  rates.    More  be- 
cause of  the  hours  worked  than  the  wages  paid,  this  small  pattern- 
maker was  a  disturbing  factor  to  the  industry.    Two   things  are 
accomplished  through  the  American  Pattern  and  Model  Companv 
which  are  very  useful  to  the  union  in  its  attempts  to  deal  with  this 
problem.    Some  of  these  small  jobbers  are  members  of  the  union. 
Frequently  this  fact  is  found  out  through  the  Company,  in  this  way. 
The  Company  has  submitted  a  bid  on  a  job  and  fails  to  secure  it. 
Being  an  interested  party,  the  officials  of  the  Company  make  in- 
quiries as  to  who  obtained  the  work.    Thus  members  of  the  Pattern 
Makers'  Association  who  are  mclined  to  break  down  union  standards 
may  be  detected  and  thereafter  disciplined.    In  the  second  place,  the 
jobbers  mav  undertake  to  cut  prices  for  jobbing  work  with  the  view 
of  underbidding  the  American  Pattern  and  IModel  Company  and  thus 
driving  the  Company  out  of  business.    However,  the  Company  has  the 
advantage  in  competition  of  this  character,  because  it  does  not  have 
to  earn  a  profit.   The  stockholders  are  more  interested  in  continuous 
employment  than  in  the  dividends  declared  on  their  shares.    There- 
fore this  company  can  afford  to  take  work  at  cost  of  production  and 
continue  to  operate  indefinitely  on  that  basis.    Besides,  the  small 


i 


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4'- 


494       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

jobber  cannot  handle  the  larger  orders,  because  he  is  not  equipped, 
either  as  to  space  or  tools,  for  handling  the  larger  work ;  therefore 
this  kind  of  competition  is  restricted  to  the  smaller  jobs.  The  power 
of  the  union  through  its  connections  with  this  Company,  whether 
considered  in  its  relation  to  the  small  jobbing  competitor  or  to  the 
employer  unwilling  to  pay  the  scale,  is  in  a  large  measure  a  potential 
force.  How  extensively  it  is  used  depends  upon  the  urgency  of 
the  case. 

In  this  unique  way  a  small  compact  group  of  skilled  workmen  have 
organized  and  carry  on  regular  trade-union  functions.  Agreements 
with  the  employer,  while  conforming  to  the  normal  representative 
methods  through  union  officials,  are  more  completely  individualized 
than  is  usual  in  collective  trade-union  action.  The  agreement  is 
always  verbal,  and  because  of  the  character  of  the  work  it  is  fre- 
quently in  respect  to  a  particular  man.  It  may  happen  that  only  a 
very  few  men  are  capable  of  making  the  kind  of  pattern  specified. 
But  whether  this  be  the  case  or  not,  the  officer  of  the  union  is  called 
upon  to  furnish  a  specified  number  of  men  who  are  capable  of  doing 
a  definite  kind  of  work.  Through  its  connections  with  the  American 
Pattern  and  Model  Company  the  union  holds  a  strategic  advantage 
in  its  endeavors  to  protect  and  improve  working  conditions  that  is 
possessed  by  few,  if  any,  other  unions  in  the  country.  No  attempt  is 
here  made  to  argue  that  the  experience  of  this  union  can  be  extended 
successfully  to  other  organizations.  The  information  is  presented  to 
show  what  different  methods  may  be  employed  by  trade-unions  as 
aids  in  collective  bargaining. 

F.  S.  Deibler 
Northwestern  University 


XXXIIl 

THE  SETTLEMENT  OF  DISPUTES  UNDER  AGREE- 
MENTS IN  THE  ANTHRACITE  INDUSTRY^ 

IN  THE  approaching  conferences  between  the  anthracite  operators 
and  representatives  of  the  mine  workers  on  the  renewal  of  the 
agreement  which  expires  on  March  31,  191 6,  the  method  of  settling 
"grievances"  arising  during  agreements  has  already  been  forecasted 
as  one  of  the  most  important  questions.  At  the  tri-district  convention 
of  the  United  Mine  Workers  held  last  September  at  Wilkesbarre, 
Pennsylvania,  demands  were  formulated  which  included  the  estab- 
lishment of  additional  machinery  for  conciliation  in  each  district,  less 
delay  in  the  settlement  of  disputes,  and  the  placing  of  such  funda- 
mental questions  as  detailed  wage  scales  and  conditions  of  work 
within  the  jurisdiction  of  the  conciliation  machinery  provided  for 

by  agreements.^ 

The  full  significance  of  these  demands  cannot  be  appreciated 
unless  they  are  considered  in  their  relation  to  the  developments  and 
the  tendencies  that  have  been  manifested  in  the  history  of  conciliation 
and  arbitration  of  grievances  since  the  award  of  the  Roosevelt 
Anthracite  Coal  Strike  Commission  was  made  in  1903.  While  this 
award  furnished  the  principles  and  the  chief  machinery  for  settling 
disputes  and  grievances  in  the  establishment  of  a  Board  of  Concil- 
iation for  the  entire  Pennsylvania  anthracite  field,  there  have  been 
at  least  twoimportant  tendencies  in  the  adjusting  of  grievances  aris- 
ing under  the  agreements  made  subsequent  to  the  award.  ,One]sseen 
ioOiedeyelopment  of  additional  machineryJ[qii_conciliationJif^^m 
ters  before  they  reachjhe  Board  of  Conciliation.    This  development 

iFrom  Journal  of  Political  Economy,  Vol.  XXIV  (1916),  pp.  254-283. 

2 The  "tri-district  convention"  is  composed  of  delegates  from  the  three  dis- 
tricts of  the  United  Mine  Workers  of  America  in  the  Pennsylvania  anthra- 
cite field  This  convention  formulates  and  adopts  a  series  of  demands  upon 
the  operators  which  later  become  the  principal  issues  in  the  negotiations  of 
agreements. 

495 


•I 


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■11 


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496       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

has  taken  the  form  of  methods  by  which  questions  can  be  settled 
locally  at  the  collieries  or  in  the  districts  in  which  they  arise. 
The  other  tendency  has  been  toward  the  settlement  by  the  system  of 
conciliation  and  arbitration  oi_n}att£rs  of  far  greater ImportaiicF thin 
were  originally  contemplated.  This  development  has  been  due  not 
onlylb  the~fact  that  new~and  unforeseen  questions  arose,  such  as  the 
introduction  of  new  coal-cutting  machines,  but  also  to  the  facts 
that  increasing  emphasis  has  been  given  to  matters  that  were  within 
the  jurisdiction  of  the  conciliation  and  arbitration  system  and  that 
greater  confidence  in  the  efficacy  of  such  a  system  to  settle  disputes 
has  been  felt.  Among  the  effects  of  these  two  developments  have 
been  a  strengthened  prestige  and  an  increased  membership  of  the 
United  Mine  Workers  in  the  anthracite  field,  an  effective  means  of 
educating  immigrant  workers  in  unionism  and  in  collective  relations 
with  their  employers,  and,  apparently,  a  more  firmly  established 
basis  for  collective  bargaining  in  the  industry. 

Some  of  the  more  important  features  of  the  evolutionary  develop- 
ment of  the  conciliation  and  arbitration  of  disputes  under  the  agree- 
ments may  be  indicated  by  reviewing  (i)  the  development  of  the 
machinery  of  conciliation  and  arbitration  of  these  disputes,  (2)  the 
working  of  this  machinery  in  practice,  and  (3)  the  general  character 
of  the  matters  coming  up  for  settlement  as  well  as  of  the  settlements 
themselves. 

I.    THE  DEVELOPMENT  OF  METHODS  OF  SETTLING  DISPUTES 

Two  methods  of  adjusting  disputes  and  grievances  haVe  been  in 
existence  ever  since  1903,  when  the  award  of  the  Anthracite  Coal 
Strike  Commission  was  made.  One  method  was  conciliation,  at  first 
bv  a  bipartisan  Board  of  Conciliation  for  the  entire  anthracite  field, 
and  later  by  localTn^TTfore  direct'agencies  and  means  in  addition  to 
the  central  board.  The  other  method  was  arbitration  by  umpires 
appointed  by  the  federal  circuit  court  in  the  anthracite  section  of 
^^""^>^?yi"J?^--  ^^  ^^^s^  umpires  are  referred  matters  which  can- 
not be  settled  by  the  Conciliation  Board.  The  method  of  conciliation 
has  undergone  several  important  developments,  while  the  method  of 
arbitration  has  remained  practically  unchanged  since  1903.  The 
development  of  conciliation  methods  may  therefore  be  reviewed  in 
some  detail. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY      497 

As  constituted  by  the  Anthracite  Coal  Strike  Commission's  awards, 
the  plan  of  conciliation  was  as  follows : 

IV    The  Commission  adjudges  and  awards  :  That  any  difficulty  or 
disagreement  arising  under  this  award,  either  as  to  its  mterpretation 
or  application,  or  in  any  way  growing  out  of  the  relations  of  the  em- 
ployers and  employed,  which  cannot  be  settled  or  adjusted  by  con- 
sultation between  the  superintendent  or  manager  of  the  mme  or 
mines,  and  the  miner  or  miners  directly  interested,  or  is  of  a  scope 
too  large  to  be  so  settled  or  adjusted,  shall  be  referred  to  a  permanent 
joint  committee,  to  be  called  a  Board  of  Conciliation,  to  consist  of 
six  persons,  appointed  as  hereinafter  provided.    That  is  to  say,  it 
there  shall  be  a  division  of  the  whole  region  into  three  districts,  m 
each  of  which  there  shall  exist  an  organization  representing  a  majority 
of  the  mine  workers  of  such  district,  one  of  said  Board  of  Concilia- 
tion shall  be  appointed  bv  each  of  said  organizations,  and  three  other 
persons  shall  be  appointed  by  the  operators,  the  operators  in  each  of 
said  districts  appointing  one  person.  ,    ,    „      ,  j 

The  Board  of  Conciliation  thus  constituted  shall  take  up  and  con- 
sider any  question  referred  to  it  as  aforesaid,  hearing  both  parties 
to  the  controversy,  and  such  evidence  as  may  be  laid  before  it  by 
either  party  ;  and  any  award  made  by  a  majority  of  such  Board  of 
Conciliation  shall  be  final  and  binding  on  all  parties.  If,  however 
the  said  Board  is  unable  to  decide  any  question  submitted,  or  point 
related  thereto,  that  question  or  point  shall  be  referred  to  an  umpire, 
to  be  appointed,  at  the  request  of  said  Board,  by  one  of  the  circuit 
judges  of  the  third  judicial  circuit  of  the  United  States,  whose  decision 
shall  be  final  and  binding  in  the  premises. 

The  membership  of  said  Board  shall  at  all  times  be  kept  complete, 
either  the  operators'  or  miners'  organizations  having  the  right,  at  any 
time  when  a  controversy  is  not  pending,  to  change  their  representation 

thereon.  ^    ,  .  ,  ^   , 

At  all  hearings  before  said  Board  the  parties  may  be  represented 
by  such  person  or  persons  as  they  may  respectively  select. 

No  suspension  of  work  shall  take  place,  by  lockout  or  strike,  pend- 
ing the  adjudication  of  any  matter  so  taken  up  for  adjustment. 

It  will  be  noted  that  the  award  provided  for  (i)  local  conciliation 
by  superintendents  or  managers  of  the  mines  with  the  miners  directly 
interested,  without  however  providing  for  any  machinery  for  formal 
methods;  (2)  conciliation,  by  a  joint  committee  or  board  repre- 
senting operators  and  workers  of  the  entire  industry,  of  disputes  on 
all  questions  which  (a)  cannot  be  settled  locally  and  {b)  are  of  too 
great  a  scope  to  be  settled  locally,  the  majority  decision  of  the  board 
to  be  final  and  binding. 


I 

» 


^ 


I 


*<t 


:V: 


\ 


498       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  local  settlement  of  disputes  was  merely  inferential  from  the 
provisions  of  the  award,  and  no  specific  provision  for  such  settle- 
ment was  made  in  any  agreements  until  1909.  The  Board  of  Con- 
ciliation, however,  early  in  its  existence  recognized  the  inference 
in  the  1903  award.  At  its  organization  meeting  the  Board  provided 
by  resolution  that  grievances  must,  in  the  effort  to  secure  settlements 
without  resort  to  the  Board,  be  referred,  seriatim,  ( i )  to  the  foremen 
of  mines,  (2)  to  company  superintendents,  and  (3)  to  the  two  mem- 
bers of  the  Board  in  the  particular  district,  who  must  first  confine 
their  efforts  to  getting  the  operators  concerned  to  see  the  complainants 
and  consider  the  grievance/  The  object  of  this  resolution  was  to 
compel  the  employer  to  deal  directly  with  the  complaining  employee,^ 
as  well  as  to  secure  as  large  a  number  of  local  settlements  of  disputes 
as  possible.  This  resolution  was  in  force  for  six  years  and  was  the 
forerunner  of  the  following  provision  of  the  agreement  of  1909 : 

Any  dispute  arising  at  a  colliery  under  the  terms  of  this  agreement 
must  first  be  taken  up  with  the  mine  foreman  and  superintendent  by 
the  employee,  or  committee  of  employees  directly  interested,  before 
it  can  be  taken  up  with  the  Conciliation  Board  for  final  adjustment. 

Still  no  local  machinery  was  definitely  provided  for  the  settling 
of  disputes,  the  employers  insisting  on  dealing  with  their  employees 
as  directly  as  possible  and  without  recognizing  the  union  to  such  an 
extent  as  to  concede  a  provision  for  permanent  or  regularly  constituted 
committees  representing  the  local  bodies  or  organizations  of  mine 
workers.  The  question  of  the  convenience  of  local  conciliation 
methods  thus  became  involved  in  the  question  of  recognition,  and 
the  status  of  conciliation  as  fixed  in  1903  underwent  no  material 
change  until  1912. 

The  mine  workers  in  19 12  made  a  specific  demand  for  "a  more 
convenient  and  uniform  system  of  adjusting  local  grievances  within 

ip.  J.  Wame,  "Trade  Agreement  in  the  Coal  Industry,"  Annals,  September, 
1910,  pp.  91-02. 

2  This  procedure  had  already  been  provided  for  so  far  as  the  union  was  con- 
cerned by  the  constitution  of  the  United  Mine  Workers  of  America,  which  pro- 
vided that  whenever  any  dispute  arises  between  the  members  of  a  local  union 
and  their  employers  it  is  the  duty  of  the  officers  of  the  local  union  concerned 
to  endeavor  to  bring  about  a  settlement  by  peaceful  means.  If  amicable 
methods  fail,  then  the  local  union  officers  may  notify  the  district  officers.  If 
the  district  officers  fail  to  bring  about  a  peaceful  settlement,  they  may  order  a 
strike.   See  Article  X,  Section  i,  of  the  constitution. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY      499 

a  reasonable  time  limit."    The  agreement  of   19 12    contained   the 
following  provision: 

(d)  At  eacLjftffl^-thec£_sliall  be  a  grievance,£Qm.mitt,e.S.  consisting 
of  not  more  than  three  employees,  and"s{Idrcommittee  shall  under 
the  terms  of  this  agreement  take  up  for  adjustment  with  the  proper 
officials  of  the  company  all  grievances  referred  to  them  by  employees 
who  have  first  taken  up  said  grievance  with  the  foreman  and  failed 
to  effect  proper  settlement  of  the  same.  It  is  also  understood  that  the 
member  of  the  Board  of  Conciliation  elected  by  the  Mine  Workers 
organization  or  his  representative  may  meet  with  the  mine  committee 
and  company  officials  in  adjusting  disputes.  In  the  event  of  the  mine 
committee  failing  to  adjust  with  the  company  officials  any  grievance 
properly  referred  to  them  they  may  refer  the  grievance  to  the  mem- 
bers of  the  Board  of  Conciliation  in  their  district  for  adjustment, 
and  in  case  of  their  failure  to  adjust  the  same  they  shall  refer  the 
grievance  to  the  Board  of  Conciliation  for  final  settlement,  as  pro- 
vided in  the  Award  of  the  Anthracite  Coal  Strike  Commission  and 
the  agreements  subsequent  thereto,  and  whatever  settlement  is  made 
shall  date  from  the  time  the  grievance  is  raised. 

It  will  be  noted  that  the  above  clause  provided  for  two  additional 
steps  in  conciliation  intermediate  between  the  direct  settlement  of 
disputes  by  local  mine  managers  or  superintendent  and  employee 
or  employers  interested  and  the  reference  of  disputes  to  the  Con- 
ciliation Board,  as  follows: 

1.  Reference  to  grievance  committees  of  employees  at  each  mine, 
the  committees  to  deal  with  the  offrcTaTs~of'The  company  owning 

the  mine ; 

2.  References  to  the  two  members  of  the  Board  of  Conciliation  of 
the  district,  one  of  whom,  according  to  tlie  system  already  in  exist- 
encerTepfesenfs~nie  employers  and  the  other  the  workers. 

Since  191 2  a  new  feature  has  been  evolved  in  the  form  of  "general 
grievancfijLflinniittees "  composed  of  representatives  from  local  com- 
munities. These  committees  exist  among  the  employees  of  certain 
companies,  notably  the  Delaware  and  Hudson,  in  some  sections  of 
the  field,  and  among  the  employees  of  an  entire  section,  as  in  the  case 
of  the  Schuylkill  region.  They  are  not  provided  for  in  the  agreement 
and  are  not  recognized  by  the  Board  of  Conciliation.  Their  origin 
seems  to  have  been  in  the  work  of  local  grievance  committees  which, 
according  to  the  terms  of  the  19 12  agreement,  met  with  company 
officials  within  sixty  days  after  the  agreement  was  signed,  to  prepare 


ifR 


500       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

statements  "setting  forth  the  rates  of  pay  to  be  certified  to  the 
Board  of  Conciliation."  For  purposes  of  convenience,  it  appears, 
certain  companies  met  with  representatives  of  all  the  local  grievance 
committees  from  their  own  collieries,  and  these  representatives  after- 
ward undertook  to  become  separate  entities.  They  first  attempted 
to  make  new  adjustments  in  the  wage  scales  involving  changes  in 
the  system  of  differentials,  and  later  tried  to  deal  collectively  with 
general  questions  affecting  the  mine  workers.  Not  only  were  they 
not  recognized  by  the  employers  and  the  Board  of  Conciliation,  but 
their  existence  has  been  fought  by  the  leaders  of  the  union.  In  the 
19 14  convention,  for  example,  of  the  United  Mine  Workers  in  Dis- 
trict No.  I  the  question  occasioned  a  good  deal  of  strife  and  the 
union  was  well  divided.  It  appears  to  be  clear  that  those  who  were 
critical  of  the  administration  in  the  union  were  disposed  to  side  with 
the  advocates  of  general  grievance  committees  and  that  the  con- 
troversy assumed  a  somewhat  political  character  within  the  union. 

Whatever  may  have  been  the  influence  of  this  faction  in  shaping 
the  1915  demands,  it  is  significant  that  in  addition  to  a  demand  for 
"more  simplified  and  speedy  methods  of  adjusting  grievances" 
there  is  now  a  demand  for  conciliation  of  questions  involving  the 
"  arrangements  of  detailed  wage  scales  and  the  settlement  of  internal 
questions  both  as  regards  prices  and  conditions"  by  reference  to 
"the  representatives  of  the  operators  and  miners  of  each  district." 
If  the  last-named  demand  is  acceded  to,  not  only  will  the  machinery 
for  the  adjustment  of  disputes  under  the  agreement  be  enlarged  but 
the  assignment  of  the  larger  questions  involving  wage  rates  and 
conditions  of  work  to  the  field  of  its  jurisdiction  will  greatly  add  to 
the  importance  of  the  local  adjusting  bodies. 

XL   THE  CONCILIATION  AND  ARBITRATION  PLAN 

IN  PRACTICE 

The  actual  operation  of  the  machinery  of  settling  disputes  and 
grievances  arising  under  agreements  may  be  reviewed  briefly  under 
the  following  heads:  (i)  the  conciliation  plan  in  practice,  (2)  the 
arbitration  plan  in  practice,  and  (3)  cessations  of  work  occurring 
during  agreements. 

I.  The  conciliation  plan  in  practice.  With  the  plan  of  concilia- 
tion, as  it  has  developed  up  to  the  present  time,  in  mind,  its  work 


ji| 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY      501 

in  actual  practice  suggests  several  points  for  special  consideration. 
Amqng_these-ar€^  the  appellate  principle  in  the  reference  of  matters 
coming  up  for  settlement^  fe  tendency  toward  settling  disputes  as 
neaTTHTTJe^point  of  impact  as  possible,  the  frequency  of  disputes 
and  grievances^he  effects  of  conciliative  methods  on  the  numerical 
strength"  oTthe^nionj  the  relation  of  the  immigrant  mine  worker  to 
th££oncIIiation  plan,  and  the  importance  of  the  personal  equation 
in  settling  disputes  under  the  conciliation  plan. 
^"Tr-Thffe'are  no  provisions  concerning  appeals  from  decisions  made 
at  any  point  in  the  series  of  references  except  the  provisions  setting 
forth  the  finality  of  the  decisions  of  the  Board  of  Conciliation  and 
of  umpires.    FromJthe_decisions  of  the  Board  and  of  the  umpires, 
according  to  an  explicit  provision  in  the  1903  award  and  in  the 
subsequent  agreements,  no  appeals  can  be  made,  although  on  one 
occasion  an  appeal  was  made,  with  the  consent  of  both  sides,  to  a 
member  of  the  federal  judiciary  for  the  settlement  of  a  question  on 
which  an  umpire  and  the  operators'  representatives  on  the  Concilia- 
tion Board  disagreed.    This,  however,  was  an  extraordinary  case  for 
which  no  provision  had  been  conceived.    While  there  is  provided  a 
method  of  progressive  reference  of  disputes,  starting  at  the  point  of 
impact  at  the  colliery  itself  and  ending  with  an  outside  umpire  named 
by  an  outside  authority,  the  possibility  of  judicial  review  is  very 
slight.    There  are  three  points  in  the  series  of  references  where  dis- 
putants can  present  their  case  to  a  third  party — the  district  Board 
members,  the  Conciliation  Board,  and  the  umpire — and  where  the 
element  of  review  and  of  adjudication  seems  to  exist.   At  the  two 
other  points — the  complaining  employee  and  mine  boss,  and  the 
grievance  committee  and  the  company  official — there  is  no  review 
or  adjudication  whatever.    But  even  where  the  first  two  steps  in  con- 
ciliation fail  and  the  matter  in  dispute  goes  to  the  two  members  of 
the  Conciliation  Board,  it  does  not  go  as  a  case  on  its  merits,  but  as 
a  matter  which  the  two  Board  members,  with  their  knowledge  of 
the  attitude  and  of  the  precedents  of  the  whole  Board,  may  be  able 
to  settle.    Furthermore,  even  the  Board  itself  is  frankly  regarded  as 
bipartisan,  and  while  the  disputants  present  their  cases  in  a  formal 
way  to  the  Board  for  a  decision,  the  element  of  conciliation  is  in- 
tended to  be  predominant.    In  other  words,  the  entire  series  of  refer 
ences  up  to  the  umpire  is  a  series  of  attempts  by  representatives  of 


\ 


i 


m 


m 


S02       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

f  both  sides  to  a  dispute  to  settle  out  of  court  rather  than  in  court,  and 
it  is  taken  for  granted  in  all  of  the  steps  in  this  series,  and  expressly 
provided  in  one,  that  when  a  settlement  is  made  it  is  final  because 
It  is  a  real  settlement  of  the  dispute. 

The  fact  that  certain  precedents  have  grown  up  in  the  Board  of 
Conciliation  in  the  settlement  of  certain  disputes  does  not  essentially 
invest  the  Board  with  judicial  authority,  although  it  may  be  an 
evidence  of  a  judicial  habit.  The  entire  plan  of  settling  disputes 
under  the  agreement,  therefore,  is  so  constructed  as  to  eliminate,  as 
far  as  possible,  the  element  of  arbitration,  or  of  judicial  review,  by 
any  other  kind  of  body  than  a  strictly  equipartisan  one,  except  as 
a  last  resort.^  The  appellate  principle  is  strikingly  absent,  so  far 
as  the  form  of  reference  of  disputes  is  concerned. 

At  the  same  time,  it  must  be  remembered  that  the  average  in- 
dividual mine  worker  naturally  looks  upon  the  entire  process  of 
settling  disputes  as  a  series  of  appeals  from  the  decisions  of  his 
employer  or  of  his  employer's  representatives.  He  has  been  ac- 
customed to  look  for  compulsion  from  this  employer,  and  at  one 
time  his  only  method  of  appeal  from  his  employer's  decision  was  the 
strike.  The  new  method  of  "conciliation"  is  to  him  a  means  by 
which  he  can  refer  his  employer's  decision  to  some  other  authority. 
The  extent  to  which  the  agreement  is  an  actual  contract  between 
employer  and  employees  is  the  measure  of  the  correctness  of 
his  view. 

b.  Provision  for  methods  of  conciliation  has  naturally  resulted 
in  a  large  number  of  separate  disputes  and  matters  coming  up  for 
conciliation.  While  no  statistics  are  available  for  the  years  prior 
to  1903,  there  is  evidence  that  for  a  number  of  years  prior  to  the 
general  strikes  of  1900  and  1902  labor  disputes  were  few  and  far 
between  and  grievances  were  rarely  aired.-    Since  the  1903  award 

1  The  testimony  of  John  Mitchell  at  the  Washington,  D.  C,  hearings  of  the 
U.  S.  Commission  on  Industrial  Relations  showed  very  clearly  his  opposition  to 
the  submission  of  differences  to  a  third  party.  Mr.  Mitchell  was  the  mine 
workers'  representative  before  the  Anthracite  Coal  Strike  Commission,  whose 
awards  laid  the  basis  for  the  present  plan. 

2  Assertions  to  this  effect  have  been  made  by  operators  at  various  times.  See 
Report  of  the  Anthracite  Coal-Strike  Commission  and  proceedings  of  confer- 
ences. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       503 

went  into  effect,  the  number  of  complaints  submitted  to  the  Board 
of  Conciliation,  by  years,  has  been  as  follows: 


Year 

Number  of 
Complaints 

Year 

Number  of 
compiaints 

1903 

1904 

1905 

1906 

1907 

1908 

107 

16 

16 

8 

7 
9 

1909 

1910 

19II 

1912 

1913 

8 

5 

3 

51 

The  large  numberof  grievances  coming  up  immediately  after  the 
award  went  into  effect  and  tne  mcreases  in  19 10  and  19 13  following 
amendments  to  the  award  are  significant.  Many  of  these  cases  were 
caused  by  the  need  for  interpretation  of  the  awards  and  the  new 
agreements ;  others  were  due  to  the  fact  that  outlets  for  grievances 
were  provided,  especially  in  the  case  of  the  1903  award  and  the  19 12 
agreement.^  But  the  foregoing  statistics  do  not  exhibit  the  actual 
number  of  grievances,  since  they  do  not  include  those  which  are 
settled  without  reaching  the  Board.  Unfortunately  no  records  are 
kept  of  grievances  and  disputes  which  are  settled  without  reference 
to  the  Board  or  umpires,  but  it  is  asserted  by  members  and  officials 
of  the  Board  that  their  number  has  greatly  increased  since  19 12. 
^      c.  The  foregoing  consider5.tions.-sy^gest  a  tendency  toward  stopping 


disputes  near  or  at  the^^int  of  imp^cb  Aside  from  the  creation  of 
new  local  machinerj^  by  the  19T2  agreement,  and  aside  from  the 
concomitant  provision  for  reference  to  the  two  district  members  of 
the  Conciliation  Board  before  reference  to  the  entire  Board,  the  con- 
ciliation work  of  individual  members  of  the  Board  before  19 12 
showed  a  considerable  growth.  An  increasing  proportion  of  griev- 
ances, it  has  been  stated  by  members  of  the  Board,  never  reach  the 
Board,  because  they  are  settled  either  by  the  union  member  of  the 

1  The  mine  grievance  committee  was  characterized  to  the  writer  by  labor 
leaders  as  a  benefit  to  the  worker,  because  local  machinery  was  thereby 
afforded  by  which  a  worker  could  present  a  grievance  and  have  it  settled 
without  going  to  the  Conciliation  Board,  and  by  which  the  opportunity  for 
the  settlement  of  grievances  was  made  greater  than  ever  before.  It  is  natural, 
therefore,  that  the  opportunity  should  be  taken  advantage  of. 


iifi 


JLZ. 

1 

¥■  ii 

t  i 
I! 


504       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Board  or  by  the  two  members  of  the  Board  in  a  district.  The  pro- 
vision of  the  19 1 2  agreement  referred  to  above  was,  therefore,  little 
more  than  a  formal  recognition  of  the  work  of  these  conciliators. 
It  is  a  significant  fact,  perhaps,  that  the  number  of  grievances  settled 
by  agreement,  usually  by  members  of  the  Board  in  the  district  in 
which  the  grievance  originated,  was  much  larger  proportionately  from 
1909  to  191 2  than  from  1903  to  1906,  as  the  following  table  shows: 

Disposition  of  Grievances  brought  before  the  Anthracite  Board 

OF  Conciliation,   1903-1912 


Disposition  of  Grievances 


Complaints  on  which  the  Board  took  no  action 

Settled  by  agreement  of  both  parties     . 

Withdrawn  by  complainant 

Refused  by  Board 

Complaints  decided  by  the  Board : 

Employees  sustained 

Employers  sustained 

Complaints  going  to  umpire  and  decided  : 

For  employee 

For  employer 

Total 


Number  brought  up  in 


1903-1906 


M 
53 

5 


19 

6 
15 


M3 


1906-1909 


3 

7 


7 

2 

3 

4 


26 


I 909-1912 


9 

9 
I 

2 
5 

« 
« 


26* 


•  About  six  in  all  were  pending  when  the  report  of  the  Conciliation  Board  was  published. 

Thus  10  per  cent  of  the  grievances  presented  to  the  Board  in  1903- 
1906  were  disposed  of  by  means  of  settlements  by  agreement  of 
operators  and  mine  workers  immediately  concerned,  12  per  cent  in 
1906-1909,  and  over  28  per  cent  in  1909-1912. 

d.  The  creation  of  machinery  for  the  local  conciliation  of  disputes 
has  unquestionably  aided  the  mp^id  growth  of  the  union^jince  1912. 
rcmf\dence  in  the  ability  of  the  organization  to  obtain  the  settlement 
of  specific  grlFvarice's  arising  at  the  collieries  has  resulted,^  and 
membership  in  the  union  has  meant  tangible  benefits  to  the  mine 
worker.  This  effect  has  been  much  greater  under  the  19 12  agree- 
ment than  under  the  preceding  agreements,  because  of  the  provision 
for  colliery  grievance  committees.  The  grievance  committee  is  both 
an  inducement  to  the  mine  worker  to  join  the  union  in  order  to  gain 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       505 

the  benefit  of  collective  action  on  matters  of  local  interest,  and  a 
weapon  which  the  union  organization  uses  to  force  him  to  join. 

No  provision  was  made  as  to  the  manner  in  which  the  grievance 
committees  are  to  be  selected.  There  is  reason  to  believe  that  such 
a  provision  was  purposely  omitted,  since  it  would  involve  more  or 
less  formal  recognition  of  the  union  local.  In  practice  the  committees 
are  chosen  by  the  union  local  and  have  refused  to  take  up  grievances 
of  nonunion  workers ;  in  fact,  it  has  been  asserted  that  this  is  the 
usual  procedure,  and  that  the  mine  committees  are  nothing  more 
than  an  active  auxiliary  to  the  union  campaign  for  membership  and 
the  "button  strike"  method  of  compelling  nonunion  mine  workers  to 
join  the  union.  There  seems  to  be  no  doubt  that  the  mine  grievance 
committee  has  had  the  effect  of  aiding  the  unusual  increase  m  union 
membe'rship  since  1912.  The  practical  recognition  by  the  employers 
of  locaibodies  representing  the  local  unions  was  certainly  a  factor 
of  great  importance  in  stimulating  the  immigrant  mine  worker  to 
join  the  union,  because  it  enabled  him  to  see  with  his  own  eyes  a 
concrete  piece  of  industrial  machinery  which  stood  ready  to  take  up 
his  grievance  and  if  need  be  to  carry  it  "higher  up"  for  adjustment. 
It  was  natural,  therefore,  that  he  join  the  union  in  order  to  acquire 
a  standing  before  the  committee ;  if  he  did  not  join,  he  would  face 
the  opposition  of  the  committee  when  he  had  a  grievance  to  be  aired. 

e.  The  accusation  that  there  has  been  more  delay  in  the  settlement 
of  disputes  than  is  necessary  has  been  frequently  made  by  mine 
workers.  How  far  avoidable  delay  occurs  is  difficult  to  determine. 
Data  relative  to  the  length  of  time  required  to  settle  disputes  under 
the  agreements  are  incomplete  for  two  reasons:  (i)  the  date  on 
which  action  was  taken  by  the  Conciliation  Board  in  cases  referred 
to  it  is  usually  not  given  in  the  reports;  (2)  no  records  are  kept 
of  the  disputes  which  do  not  reach  the  Board.  The  report  of  the 
Conciliation  Board  for  1 903-1 906  gives  a  recapitulation  which  is 
complete,  but  this  is  not  given  in  subsequent  reports.  Following  are 
the  data  for  1903-1906  under  the  awards:^ 


Hearings  or  Action  taken  within 

One  month 44 

Two  months 69 

Over  two  months       .     .     .     .     37 


Action  of  Umpire  within 

Two  months 2 

Four  months i 

Seven  months i 


I 


1  Report  of  Board  of  Conciliation  for  Three  Years  Ending  March  31,  1906, 
p.  335- 


% 


i 


'.^M«^^H 


11 


506       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

While  no  records  exist  of  the  grievances  referred  to  mine  com- 
mittees under  the  19 12  agreement,  it  appears  to  be  generally  thought 
that  disputes  have  been  settled  by  the  new  plan  of  conciliation  with 
less  delay  than  formerly.  Frequently  the  first  step  in  conciliation, 
the^efToIt  tO  yycile  diTTerences  by  direct  conference  between  mine  boss 
and  complainants,  is  omitted  and  the  grievances  are  first  brought  by 
the  mine  committees,  and  usually  these  grievances  are  promptly 
settled,  unless  they  are  referred,  by  a  conference  of  committee  and 
company  officials.  The  191 2  provision  permitting  the  union  member 
of  the  Conciliation  Board  for  the  district  to  sit  in  these  conferences  aids 
in  the  prompt  settlement  of  disputes,  since  the  Board  member  knows 
pretty  well  what  the  prospects  for  a  successful  reference  of  a  dispute 
to  the  Board  are,  and  he  advises  the  committee  accordingly.  His 
knowledge  of  precedents  also  serves  to  guide  the  settlement  of  local 
grievances.  The  conciliation  work  of  the  two  members  of  the  Board 
from  the  district  in  which  a  grievance  originates  serves  to  prevent 
delay  by  bringing  about  settlements  without  reference  to  the  Board. 
More  businesslike  methods  of  procedure  also  have  served  to  lessen 
the  time  required  for  final  action  on  a  grievance.  The  Board  of 
Conciliation  meets  regularly  twice  a  month.  In  19 14  ninety  meetings 
were  held  for  the  disposition  of  grievances,  besides  frequent  con- 
ferences between  the  two  district  members  of  the  Board  and  be- 
tween the  individual  members  and  the  grievance  committees  and 
complainants. 

Under  the  present  methods  it  does  not  seem  that  there  is  un- 
warrantable delay  in  obtaining  decisions  on  matters  coming  up  for 
settlement.  The  members  of  the  Board  of  Conciliation  have  other 
duties  than  those  attached  to  their  office.  The  cases  coming  up 
before  the  Board  frequently  require  the  taking  of  lengthy  testimony, 
and  the  evidence  miist^he  carefully  digested  before  a  decision  can  be 
made.  Many  trivial  cases  consume  the  time  at  the  Board's  disposal. 
In  some  instances  the  decisions  require  more  than  one  conference; 
the  matters  involved  are  often  questions  on  which  careful  interpreta- 
tions must  be  made  or  actual  conciliation  is  needed.  In  fact,  it 
appears  to  be  true  that  most  of  the  cases  of  apparent  delay  are  not 
so  much  the  fault  of  the  Board  of  Conciliation  as  of  the  character 
of  the  cases  themselves.  Frequently  where  a  grievance  is  brought 
up  which  is  without  sufficient  basis  it  is  not  pressed.    Either  it  is 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       507 

postponed  in  order  to  secure  further  evidence  or  else  it  is  not  withdrawn 
and  is  allowed  to  stay  on  the  "  docket,"  because  a  member  of  the  Board 
does  not  wish  to  confess  to  his  constituents  that  he  has  not  been 
able  to  secure  favorable  action ;  hence  the  Board  is  blamed  for  de- 
laying action.  The  realization  that  less  delay  can  be  brought  about 
only  by  additional  conciliation  machinery  is  clearly  manifested  in 
the  mine  workers'  19 15  demands. 

/.  The  attitude  and  the  character  of  those  who  compose  the  Board  K 
of  Conciliation  and  the  local  grievance  committees  are  an  important  I 
factor  in  the  settlement  of  matters  under  the  agreements.    This  is  \ 
inevitably  so,  for  several  reasons,  although  the  effect  of  the  ''  personal 
equation"  cannot  be  statistically  stated.    The  members  of  a  Board 
of  Conciliation  which  meets  regularly  and  frequently  to  pass  on 
questions  that  often  involve  the  same  general  principles  learn  to 
know  each  other  personally  and  to  understand  in  an  intimate  way 
the  position,  with  reference  to  their  constituencies,  in  which  they  are 
placed.    The  character  of  the  grievances  coming  before  the  members 
of  the  Board,  and  even  their  disposition,  depends  a  good  deal  on  this 
personal  element.    In  one  district  the  members  of  the  Board  repre- 
senting the  employers  and  the  union  may  understand  each  other 
better  than  in  another  district  and  work  together  with  greater  facil- 
ity.   In  another  district  the  union  member  of  the  Board  may  be  in- 
clined to  be  a  union  ^'politician"  and  to  insist  on  points  that  will 
increase  his  prestige  with  his  constituents.    This  will  result  in  some 
friction  and  appears  to  hinder  rather  than  help  conciliation.    A  trivial 
case  may  be  pushed  more  because  of  the  publicity  it  happens  to  get 
than  because  of  the  importance  of  the  principle  involved.    For  ex- 
ample, a  breaker  boy  was  discharged  by  a  company  for  some  in- 
fraction of  the  rule.   After  eight  days  the  boy  found  employment  in 
a  mill  at  better  wages  than  he  was  getting  on  the  breaker.   A  griev- 
ance was  presented  on  the  ground  that  the  boy  was  unjustly  dis- 
charged.   The  boy  did  not  want  to  return  to  the  breaker,  because  he 
was  getting  better  wages  than  he  had  as  a  breaker  boy,  but  the  issue 
was  made  on  payment  of  his  wages  for  the  eight  days  he  was  idle. 
The  principle  that  a  discharged  worker  ought  to  be  paid  for  time 
lost  if  he  lost  it  through  no  fault  of  his  own  had  long  been  estab- 
lished, so  that  in  this  case  the  fundamental  principle  was  not  at 
stake,  but  his  wages  at  a  dollar  a  day.   The  attitude  of  the  district 


•,  i 


i 


ill 


1 


508       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

union  member  of  the  Board  was  such  as  to  cause  the  grievance  to  be 
brought  before  the  whole  Board,  where  it  was  necessary  to  hear  a 
large  amount  of  testimony  and  to  take  up  a  half  day's  time  of  the 
Board.  The  question  involved  had  its  right  or  its  wrong,  of  course, 
but  the  inability  of  the  two  members  of  the  Board  to  adjust  so  small 
a  matter  was  probably  due  to  the  desire  of  one  of  them  to  gain  sup- 
port for  himself  among  his  constituents.  An  employer  member  of 
the  Board  may  likewise  be  so  great  a  stickler  for  technicalities  that 
friction  may  continually  result.  In  another  district  the  two  members 
may  work  together  well,  rarely  present  a  case  for  decision  by  the 
Board,  and  never  do  so  unless  it  involves  a  new  issue  or  a  new  inter- 
pretation of  the  agreement.  The  opinion  has  been  expressed  that 
the  union  member  under  such  circumstances  has  been  able  to  gain 
more  concessions  on  account  of  his  personality  and  his  attitude  than 
other  union  members  of  the  Board. 

While  the  personal  element  cannot  be  accurately  measured,  one 
cannot  but  be  impressed  with  its  importance  in  the  actual  work  of 
the  Board  of  Conciliation  as  a  whole,  and  particularly  in  the  work 
of  its  members.  The  longer  the  process  of  conciliation  goes  on,  the 
greater  seems  to  be  the  importance  of  the  "personal  equation,"  es- 
pecially in  the  settlement  of  matters  by  local  conciliation  and  by 
the  district  Board  members.  Even  the  origin  of  grievances  is  affected 
in  this  way.  At  some  collieries  are  the  aggressive  individuals — the 
"trouble  makers" — in  the  leadership  of  the  local  union,  and  at  these 
collieries  grievances  occur  with  so  much  greater  frequency  that  their 
real  cause  cannot  be  doubted.  It  has  been  said  that  if  the  local 
grievances  could  be  charted  on  a  map  of  the  anthracite  field,  it  would 
be  seen  that  in  certain  sections,  and  particularly  at  certain  collieries, 
the  grievances  w^ould  be  concentrated,  while  other  collieries — the 
majority — would  receive  no  distinguishing  mark.  And  while  the 
natural  tendency  is  for  the  personal  element  to  be  discounted  by 
the  Conciliation  Board,  its  bearing  on  the  general  problem  of 
industrial  relations  and  their  adjustments  is  great,  even  if  indefinite. 

g.  The  fact  that  the  newer  immigrant  races  compose  so  large  a 
proportion  of  the  anthracite  mine  workers  is  an  element  of  great 
importance  in  the  operation  of  the  conciliation  plan.  "TheTnexperi- 
ence  of  this  group  of  workers  in  collective  bargaining,  their  ignorance 
of  American  points  of  view,  of  the  real  issues  at  stake,  and  of  the 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY  509 
Durposes  and  aims  of  unionism,  and  the  characteristics  peculiar 
toThe  various  races  represented  have  injected  into  the  s.tuat.on 
elements  so  complicating  as  to  menace  at  times  the  success  of  he 
work  of  conciliatidn.  In  spite  of  what  naturally  appear  to  have 
been  insuperable  obstacles,  however,  it  may  be  ^Mently  sa^d 
thlt  the  conciliation  plan  has  been  fairly  successfu  m  dealmg 
with  the  immigrant  and  that  the  immigrant  has  gradually  been  edu- 
Taled  in  its  afms  and  methods  to  a  far  greater  degree  than  would 

'VZ'hirspeaking,  about  80  per  cent  of  the  United  ^^ 
organization  in  the  anthracite  field  is  composed  of  Polish,  Italian, 
and  Rulnian  immigrants.   This  large  proportion  has  been  secured, 

o  far  as  active  organization  by  the  union  ,s  -"-^f '''>'. ^e^; 
;„„  orgam^exs-^i-ditooatJUlimalities;  by  printing  the  union  con 
ISr^^^^^^aXiirTp^  and  the  agreement  in  the 

Xnt  languages ;  by  allowing  immigrants  to  ^^oM.  important  offices 
in  the  local  unions  and  even  in  the  district  orgamza ton      and  by 
the  enforced  payment  of  dues  through  "button  strd.es     and  the 
work  of  the  grievance  committees.   Either  the  president  or  a  vice 
r'd  nt  of  nearly  every  local  is  of  one  of  the  nationalities  of  newer 
immi-^rants,  and  he  is  intrusted  with  the  duty  of  transiting  the 
dTati  ank  rulings  for  the  information  of  members  who  canno 
understand  English.    It  seems  to  be  true  that  the  newer  immigrant 
Jre  inclined  to  have  a  passive  attitude  toward  the  actmties  of  the 
locals  and  the  union  organization,  but  as  they  become  more  Amer- 
icanized they  gradually  take  a  more  active  part.   Not  only  are  they 
promTnent  among  the  officers  of  the  local  and  district  organization 
but  they  are  active  members  of  grievance  committees,  con  taute  a 
large  proportion  of  the  delegates  to  the  district  and  Joint-distr^ 
conventions,  which  determine  the  policies  of  the  union  in  collect  v 
bargaining,  and  have  been  on  the  conference  committees  to  meet 
the  operators.   That  their  increasing  strength  and  influence  in  the 
union  is  regarded  with  apprehension  by  some  of  the  natives  and  of 
the  older  group  of  immigrants  is  not  disguised.    At  the  same  time 
it  is  also  recognized  that  the  longer  the  experience  the  immigrant 
has  the  more  conservative  he  becomes  and  the  more  inclined  he  is 
to  work  with  the  element  which  has  been  in  control  of  the  policies 
of  the  union. 


1: 


11 


510       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  position  which  the  newer  immigrant  has  attained  has  not  been 
without  difficulty,  both  on  his  part  and  on  the  part  of  the  older  and 
native  element,  or  without  perils  to  the  cause  of  unionism.   The 
emotionalism  of  the  newer  immigrant,  his  ignorance,  his  totally  dif- 
ferent point  of  view,  and  his  frequent  inability  to  see  the  larger 
issues  at  stake  beyond  trivial  or  merely  personal  grievances  have  been 
serious  obstacles  to  conciliation.    The  tendency  on  the  part  of  the 
newer  immigrants  to  take  quick  group  action  on  matters  on  which 
the  individual  would  hesitate  perhaps  even  longer  than  the  older 
immigrant  or  the  native,  has  been  and  is  another  difficulty.    For 
example,  newer  immigrant  individuals  have  been  interviewed,  when 
a  grievance  was  pending,  with  regard  to  their  attitude  and  their 
understanding  of  unionism  and  the  trade  agreement  and  have  shown 
an  understanding  and  appreciation  that  were  unmistakable.    On  the 
very  evening  of  the  day  they  were  interviewed  they  have  been  among 
ii£.^6^  la-^ut  "Strike!  "  at  a  meeting  of  their  local  where  the 
grievance   was   aiFed.    Counterbalancing   these    characteristics   and 
tendencies,  however,  is  the  willingness  of  the  newer  immigrant  to  be 
led  by  members  of  his  own  race  who  are  in  sympathy  with  conserva- 
tive policies.    Sometimes  it  is  necessary  to  make  an  emotional  appeal 
to  him  on  the  grounds  of  loyalty  to  the  union ;  at  other  times  calm 
reasoning  w\\\  be  sufficient,  especially  if  he  can  be  dealt  with  in- 
dividually.  Accustomed  as  he  has  been  to  a  sort  of  feudal  relation- 
ship to  his  landlord  in  the  country  of  his  birth,  the  basis  of  which 
was  the  opportunity  to  obtain  assistance  in  times  of  distress,  he  now 
looks  for  guidance  to  the  older  immigrants  of  his  own  nationality. 
His  unionism,  while  emotional,  is  at  the  same  time  personal.   Without 
the  influence  of  the  leader  of  his  own  race  an  agreement  would  have 
little  weight  and  conciliation  would  have  small  meaning ;  he  would 
either  become  a  rampant  radical  or  he  would  be  a  serf.    But  under 
the  influence  of  conservative  leaders  he  is  becoming  educated  m  the 
poihF^t  view  ^^cFTs■  neceisa?y  to  collective  relations  with  the 
operators.    Unionism  in  the  anthracite  field  has  become  an  effective 
factol=' in  assimilation,  breaking  down  racial  solidarity,  training  the 
newer  immigrant  in  conservative  action,  and  bringing  him  in  close 
touch  with  natives  and  older  immigrants.    This  fact  is  strikingly 
apparent  to  anyone  who  has  had  the  opportunity  to  observe  the 
Situation  during  the  last  few  years. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY      51  ^ 

The  operators,  while  complaining  that  the  mine  workers  themselves 
—especially  the  "foreign"  element— have  not  been  capable  of 
collective  action,  particulariy  where  they  are  allowed  to  act  directly 
through  colliery  grievance  committees,  are  appreciative  of  the  difficul- 
ties of  the  union  leaders  in  controlling  the  newer  immigrants  and 
have  made  concessions  with  the  specific  purpose  of  enabling  this 
control  to  be  more  completely  exercised.  They  are  disposed  to  look 
upon  the  efforts  of  the  union  leaders  as  sincere,  and  at  least  some 
of  them  are  willing  to  lessen  and  even  to  remove  what  has  been  an 
obstacle  of  their  own  making,  the  absence  of  formal  and  complete 
recognition.  For  if  a  closed  shop  could  be  authoritatively  main- 
tained, the  control  of  the  newer  immigrant  element  would,  it  is 
claimed  by  union  leaders,  be  very  much  more  easily  accomplished 
and  collective  relations  would  be  more  solidly  established. 

Thus,  under  the  conditions  which  are  found  actually  to  exist,  and 
with  the  forces  at  work,  there  is  a  tendency  of  an  unmistakable  kind. 
The  longer  the  immigrant  stays,  the  better  educated  he  is  in  collective 
bargaining,  the  more  amenable  he  is  to  American  procedure,  and  the 
clearer  is  his  conception  of  his  responsibilities.  He  does  not  seem 
to  have  injected  any  permanent  radicalism  into  unionism  in  the 
anthracite  field.  The  T.\\\W.  movement  never  succeeded  in  gain- 
ing a  foothold,  for  example.  The  immigrant  mine  worker  seems  to 
be  assimilating  the  ideals  and  the  philosophy  of  the  unionism  that  he 
finds,  rather  than  molding  or  changing  them  in  any  appreciable  degree. 

2.  The  arbitration  plan  in  practice.  The  method  of  arbitration 
of  disputes  provided  by  the  anthracite  Strike  Commission  in  its 
1903  award  was  set  forth  as  follows : 

If,  however,  the  said  board  [Board  of  Conciliation]  is  unable  to 
decide  any  question  submitted,  or  any  point  related  thereto,  that 
question  or  point  shall  be  referred  to  an  umpire,  to  be  appointed,  at 
request  of  said  board,  by  one  of  the  circuit  judges  of  the  third  ju- 
dicial circuit  of  the  United  States,  whose  decision  shall  be  final  and 
binding  in  the  premises. 

This  method  has  remained  without  change  under  the  subsequent 
agreements.  Tl^  umpire  is  chosen  for  each  case^as  itjDomes  up,  and 
the  contingency  oTaT  deadlock  in  choosing  an^mpire  is  prevented 
by  having  his  appointment  in  the  hands  of  a  federal  judge  in  the 
anthracite  section.    In  practice,  however,  both  parties  are  consulted 


I 


512        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

and  as  a  rule  have  been  able  to  agree  on  the  man  to  be  named,  and 
the  choice  has  been  so  closely  confined  to  three  men— former  United 
States  Commissioners  of  Labor  Carroll  D.  Wright  and  Charles  P.  Neill 
and  former  United  States  Circuit  Judge  George  Gray,  all  of  whom 
were  connected  in  official  capacities  with  the  Strike  Commission- 
that  the  principle  of  permanent  umpires  may  be  said  to  have  been  fol- 
lowed. The  first  two  named  were  national  officials  while  acting  as 
umpires,  except  in  the  case  of  Dr.  Neill,  who  was  employed  as  umpire 
for  several  years  after  his  resignation  as  Commissioner  of  Labor. 
Furthermore,  all  of  them  may  be  considered  expert  arbitrators,  es- 
pecially Dr.  Neill,  whose  experience  in  this  line  has  been  extensive 

and  varied. 

A  rather  unusual  situation  occurred  in  1904,  when  reference  was 
made  to  Judge  Gray,  then  of  the  United  States  Circuit  Court,  after 
Umpire  Wright  had  given  a  decision.  The  question  arose  in  1903 
whether  deductions  could  be  made  from  the  wages  of  all  of  the  miners 
at  a  colliery  for  the  payment  of  checkweighman  or  check  docking 
bosses  when  only  a  majority  of  the  miners  had  petitioned  for  the 
installation  of  weighmen  or  bosses.  The  Board  of  Conciliation  de- 
cided, in  July,  1903,  on  a  case  presented  to  it,  that  checkweighmen 
or  check  docking  bosses  should  be  installed  when  a  majority  of  the 
miners  petitioned,  but  that  collections  for  paying  their  salaries  or 
wages  could  be  made  only  from  those  miners  who  consented.  In 
October,  1903,  the  question  came  up  again  to  the  Board  in  another 
grievance  case  in  which  it  was  claimed  that  certain  operators  had 
refused  to  collect  a  certain  sum  from  each  miner  for  the  payment  of 
weighmen  or  docking  bosses.  The  Board  divided  on  this  occasion, 
and  the  question  went  to  an  umpire.  Umpire  Wright  did  not  sustain 
the  grievance  as  it  was  presented;  he  made  rulings  that  sustained 
the  contentions  of  the  complainants.  The  operators'  representatives 
on  the  Board,  however,  claimed  that  the  umpire  had  no  authority  to 
reverse  a  decision  of  the  Board.  As  a  way  out  of  the  difficulty,  the 
interests  represented  on  the  Board  agreed  to  submit  the  interpretation 
of  the  award  to  Judge  Gray,  agreeing  to  abide  by  his  decision,  whether 
it  meant  discharging  the  umpire's  rulings  or  rescinding  their  own 
decision  of  July,  1903.  Judge  Gray,  after  a  lengthy  review  of  the 
case  in  all  of  its  aspects,  interpreted  the  award  in  the  same  way  as 
Umpire  Wright. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       5^3 

The  distinctly  arbitrative  nature  of  this  reference  is  seen,  first, 
in  the  fact  that  the  representatives  of  mine  workers  and  of  operators 
had  clashed  and  deadlocked,  and,  second,  in  their  agreement  to  abide 
by  the  opinion  of  Judge  Gray  even  if  his  opinion  should  be  con- 
trary to  the  umpire's  decision.    In  other  words,  the  situation  was 
a  peculiarly  critical  one.    While  the  technicality  of  the  authority  of 
an  umpire  to  reverse  a  decision  of  the  Board  was  introduced,  the 
real  question  was  fundamentally  similar  to  that  of  the  check-off^ 
The  creation  of  a  miners'  fund  by  deducting  a  specified  sum  fixed 
by  a  majority  of  the  miners  and  the  precedent  of  deducting  it  from 
all  the  employees'  wages  at  the  demand  of  those  employees  who  were 
members  of  the  union  locals  were  looked  upon  as  constituting  a 
dangerous  precedent.    It  was  an  instance  where  the  plan  of  con- 
ciliaUon  and  arbitration  broke  down  and  where  it  was  necessary 
to  create  new,  although  temporary,  machinery  to  bring  about  a 

settlement. 

This  was,  however,  the  only  instance  of  its  kind. 

3.  Cessations.  The  number  of  cessations  of  work  cannot  be 
exactly  determined  prior  to  19 13,  nor  can  cessations  be  distinguished 
from  suspensions  incident  to  the  making  of  agreements  in  those  years 
in  which  agreements  were  made.  In  other  years,  however,  the  num- 
ber of  cessations  was  inconsiderable  except  for  19 13.  The  statistics 
in  the  table  below  show  the  number  of  men  on  strike,  the  days 
lost  from  work,  and  the  average  days  lost  per  striker  in  the  years  in 
which  agreements  were  not  made.   In  cases  where  "None"  appears. 


_^ 

Number  of  Men 

Total  Days  Lost 

Average  Number  of 
Days  Lost  per  Man 

Year 

ON  Strike 

FROM  Work 

ON  Strike 

I90I     . 
1903    . 

None 
None 

None 
None 

None 
None 

1904    . 

2,228 

34.103 

IS 

1905 

4,998 

33'986 

7 

1906 
1908 

None 

None 

None 

None 

None 

None 
6 

19IO 
19II 

2,853 

I5'739 

5,900 

36,958 

6 

I913 

64,086 

481,678 

8 

I914 

L^ 

^__ 

26,115 

179.743 

7 

IS! 

I 


m 


514       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


either  there  were  no  cessations  at  all,  or  the  number  was  so  slight 
that  it  was  not  included  in  the  tabulations  of  the  United  States 
Geological  Survey. 

f  From  the  above  it  will  be  seen  that  the  cessations  from  1901  to 
191 1,  inclusive,  were  inconsiderable.  They  were  in  the  form  of  local 
colliery  strikes  of  short  duration  and  were  caused  by  local  disputes 
over  local  questions,  according  to  statements  of  union  officials  and 
the  mine  operators.  The  United  States  Geological  Survey  reports 
no  cessations  at  all  in  1901,  occasional  cessations  of  short  duration 
and  having  little  effect  on  coal  production  in  1903,  and  only  five 
small  strikes  in  1904. 

In  19 10,  the  year  after  the  1909  agreement  for  three  years  had 
been  consummated,  there  were  stated  to  be  a  few  cases  of  temporary 
shutdowns  because  of  labor  difficulties.  Only  one  instance  occurred 
in  which  the  idleness  extended  over  twelve  days,  most  of  the  troubles 
lasting  from  one  day  to  one  week.  Some  idea  of  their  causes  may  be 
gleaned  from  the  complaints  made  by  operators  to  the  Conciliation 
Board  and  the  employees'  answers.  Only  six  of  these  complaints 
were  made  from  1903  to  19 12  and  in  four  of  them  the  causes  are 
shown  as  follows : 

May,  1903 — Demand  of  men  that  pay  days  be  unchanged. 

July,  1903 — Demand  of  men  for  increased  pay,  the  issue  being  an 
interpretation  of  the  1903  award. 

August,  1904 — Demand  of  men  to  test  coal  scales  at  mine. 

February,  1907  —  Refusal  of  men  to  clean  coal. 

The  cessations  in  these  instances  lasted  a  few  days,  with  the 
exception  of  the  second  one  named,  which  lasted  four  months  and 
involved  60  men. 

Under  the  19 12  agreement  the  cessations  have  been  more  numerous 
than  under  the  award  or  the  previous  agreements.  According  to  the 
report  of  the  Bureau  of  Anthracite  Coal  Statistics^  the  suspension 
pending  the  making  of  a  new  agreement,  which  lasted  from  April  i 
to  May  20,  191 2,  accounted  for  all  of  the  idle  days  caused  by  strikes ; 
hence  it  must  be  assumed  that  no  cessations  of  work  occurred.    In 


^This  Bureau  furnished  the  data  on  the  anthracite  coal  field  to  the  United 
States  Geological  Survey,  from  which  the  foregoing  statement  is  taken  (Produc- 
tion of  Coal  in  191 2,  p.  42). 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       515 


1913,  however,  64,086  men  were  on  strike,  losing  481,678  workdays, 
or  an  average  of  8  days  per  striker.  There  were  strikes  at  ninety- 
three  different  mines  during  the  year.  In  19 14  the  number  of  strikes 
was  smaller,  less  than  one  third  as  many  men  were  involved,  and  the 
average  duration  of  the  strikes  was  less.  In  1915  the  colliery  strikes 
have,  according  to  unofficial  data,  shown  a  considerable  increase. 
While  the  United  States  Geological  Survey  does  not  class  these 
strikes  as  "serious  interruptions"  from  the  standpoint  of  production,^ 
they  were  regarded  as  extremely  annoying  by  many  of  the  operators 
and  as  evidence  of  inefficiency  in  the  new  conciliation  machinery 
introduced  by  the  19 12  agreement.  Thev_were  of  two  kinds,  petty- 
grrig^V^^^prp  gtrjkesjind  "button  strikes." 

a.  Petty-grievance  strikes  appear  to  be  due  to  one  of  two  causes 
when  conditions  at  a  colliery  bring  about  dissatisfaction.  The  local 
union  may  be  influenced  by  a  radical  or  emotional  leader  to  strike 
without  employing  the  conciliation  machinery  provided  by  the  agree- 
ment. The  local  union  itself  may  be  controlled  by  an  excitable 
element  and  force  its  leader  to  agree  to  a  strike.  The  former  cause 
is  believed  by  the  operators  to  be  the  most  frequent  cause  of  petty 
strikes  of  this  character,  while  labor  leaders  ascribe  them  chiefly  to 
the  presence  of  immigrant  workers.  There  seems  to  be  ground  for 
the  validity  of  both  explanations.  In  the  one  case,  the  frequency 
of  grievance  strikes  at  certain  collieries  where,  it  is  claimed,  leaders 
of  the  types  referred  to  are  known  to  be  would  tend  to  substantiate 
the  operators'  view.  In  the  other  case,  observation  of  actual  meet- 
ings of  mine  locals  shows  that  the  immigrant  workers  are  responsible ; 
the  introduction  of  conciliation  methods  among  a  population  com- 
posed of  peoples  whose  racial  characteristics  are  so  different  from  the 
older  immigrants  and  nations  may  be  expected  to  have  unusual  re- 
sults. On  the  other  hand,  the  tractability  of  the  newer  immigrant 
when  he  is  approached  by  those  who  understand  him  is  a  well-known 
characteristic,  and  observation  of  actual  instances  has  shown  that 
the  intelligent  labor  leader  has  been  able  to  prevent  many  local 


<■  pi 


J 


f 


( 


1 


i"In  consequence  of  the  miners  and  operators  again  extending  the  terms 
of  the  awards,  this  time  for  a  period  of  four  years,  there  were  no  serious  inter- 
ruptions to  coal-mining  operations  by  labor  troubles  in  1913"  (Production  of 
Coal  in  1913,  p.  883). 


1 ,' 


i 


516       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

strikes  because  he  has  known  how  to  deal  with  the  new  immigrant 

unionist.^ 

b.  "BMiton_stnkes.'^ar^  not  caused  by  dissatisfaction  with  work- 
ing conditions,  but  are  a  method  of  obtaining  a  closed  shop  at  a 
colliery.  Buttons  are  issued  each  month  by  the  union  to  members 
Irreceipts  for  payment  of  their  monthly  dues.  In  order  to  enforce 
the  payment  of  membership  dues  by  all  workers  at  a  colliery,  a  strike 
of  the  button-wearers  is  sometimes  inaugurated  to  force  the  non- 
union workers  to  join.  Naturally  these  "button  strikes,"  as  they  are 
called,  occur  most  frequently  during  membership  campaigns  by  the 
United  Mine  Workers.  In  19 13,  when  an  effort  to  recruit  the  union 
strength  was  being  made,  they  were  numerous  and  occasioned 
vigorous  protests  from  the  operators.  In  1915,  during  a  campaign 
for  members- preliminary  to  the  191 6  negotiations,  they  were  again 
quite  numerous.  While  button  strikes  are  technically  violations  of 
the  agreement,  andjhe^oard  of  Conciliation  unanimously ^ssed  a 
resolution  condemning  them  as  violations^  the  opinion  has  been  ex- 
pressed by  labor  leaders  that  if  the  operators  had  conceded  the  check- 
off, the  closed  shop,  and  full  recognition,  the  union  would  be  in  the 
position  of  supplying  labor  according  to  contract  instead  of  fighting 
for  its  existence  at  every  colliery. 

Button  strikes  occur,  as  suggested  above,  spasmodically.    In  19 14 

tthey  practically  disappeared  for  three  reasons:  (i)  in  some  cases 
collieries  were  completely  unionized  and  the  custom  of  belonging  to 
the  union  apparently  established;  (2)  in  other  cases  a  revulsion  of 
feeling  took  place  among  the  workers  and  they  were  no  longer  willing 

iThe  prevalence  of  petty-grievance  strikes  was  a  subject  of  comment  in  the 
report  of  President  John  T.  Dempsey,  of  the  U.M.W.  District  No.  i,  to  the 
annual  convention  in  July,  1913-  He  said  :  "I  regret  that  it  is  necessar>'  for  me 
to  call  your  attention  to  the  fact  that  during  the  past  year  violations  of  the 
laws  of  the  organization  and  the  terms  of  the  agreement  have  been  quite  fre- 
quent. Numerous  petty  strikes  for  trivial  causes  have  taken  place  and  have 
been  the  cause  of  much  resentment  and  bitterness  on  the  part  of  the  operators. 
I  am  of  the  belief  that  these  practices  cannot  result  in  any  permanent  good  for 
our  organization  or  its  membership.  Therefore  I  strongly  recommend  that  this 
convention  place  itself  squarely  on  record  for  the  faithful  observance  of  our 
laws  and  contracts." 

The  report  of  the  convention's  committees  on  officers  strongly  seconded  this 
advice,  but  the  debate  showed  that  some  of  the  local  union  leaders  believed 
that  they  had  grounds  for  this  participation  in  mine  strikes.  The  report  was 
adopted,  but  not  unanimously. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY      51? 

to  lose  two  or  three  days'  pay  in  order  to  force  a  recalcitrant  worker 
to  join;  (3)  in  still  other  cases  the  use  of  the  lockout  by  operators 
as  a  means  of  punishment  was  effective.  One  company,  for  example, 
\  adopted  the  policy  of  closing  down  a  colliery,  where  a  button  or 
grievance  strike  had  started,  for  two  or  three  weeks.  This  method  of 
discipline,  it  is  claimed,  caused  the  workers  to  "think  twice"  before 
striking  again  and  to  blame  the  instigators  of  the  strike  for  their 
loss  of  wages. 


III.  SETTLEMENTS  OF  DISPUTES  AND   GRIEVANCES 

The  nature  of  the  questions  coming  up  for  settlement  under  the 
1903  award  and  the  subsequent  agreements  has  largely  determined 
whether  the  settlements  themselves  are  purely  interpretative  of  the 
award  and  the  agreements  or  are  amendatory  of  them.^ 

I.  The  great  majority  of  the  settlements  have  been  interpretative.  \ 
The  specific  questions  involved  which  may  be  classed  as  necessitating 
interpretative  settlements  have  been  as  follows: 

a.  Questions  of  wages,  such  as  advances  allowed  by  award  and 
agreements,  reduction  in  v/ages  (that  is,  below  the  rates  allowed), 
back  pay,  and  interpretation  of  sliding  scale.  Some  of  the  other  issues 
indirectly  required  interpretation  of  the  award  and  agreements,  such 
as  those  involving  rates  for  yardage,  cars,  size  of  cars,  and  topping, 
since  the  differentials  and  all  rates  of  pay  were  permitted  by  the 
award  and  the  agreement  to  remain  on  the  same  system  as  prevailed 
in  April,  1902,  the  new  provisions  allowing  only  horizontal  percent- 
age increases.  Fully  half  of  the  matters  relating  to  wages  were  thus 
clearly  interpretative. 

b.  Check  docking  bosses  and  checkweighmen. 

c.  Hours. 

d.  Discrimination  against  employees  because  of  union  affiliations, 
so  far  as  it  could  be  determined  according  to  the  definition  of  dis- 
crimination given  by  the  award  and  the  agreements. 

1  Since  no  records  are  kept  of  grievances  or  disputes  unless  they  are  brought 
before  the  Board  of  Conciliation,  the  data  relating  to  these  matters  are  confined 
to  the  records  of  the  Board,  four  volumes  of  which  have  been  published,  cover- 
ing the  period  1Q03-1Q13.  It  is  believed  that  the  matters  coming  up  for  settle- 
ment by  the  Board  are  fairly  representative  of  the  general  character  of  all  of 


I 


itfi 


518       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

e.  Strikes  of  employees. 

Suc^mattersTslheprice  of  powder  and  the  rates  or  prices  of  coal 
paid  by  employees  for  their  domestic  use  involved  a  settlement  of  the 
question  of  whether  or  not  they  could  be  considered  as  among  those 
conditions  existing  in  April,  1902,  which  were  to  remain  unchanged. 

the  grievances  and  disputes.   The  following  table  presents  a  recapitulation  of 
the  matters  coming  before  the  Board  for  the  ten  years  1903-1913: 

Grievances  before  Anthracite  Conciliation  Board,  1903-1913 


Settled 

BY 

Agree- 
ment 

With- 
drawn* 

Em- 

I'l-OVEES 

Sus- 
tained 

Em- 
ployer 

Sus- 
tained 

Refused 

BY 

Board t 

Umpire's  Deci- 
sion 

TotausJ 

Nature  of  Grievance 

For  Em- 
ployee 

For  Em- 
ployer 

^Vap:es 

Tvatf*5:  for  PAnl 

22 

33 

20 

15 

2 

4 

10 

19 

123 
2 

Check  docking  boss 
and    checkweigh- 
man 

I 

6 
I 

2 

3 

'9 
I 

I 
I 

I 
I 

I 

6 

Hours 

Discrimination 

against  employees 
Size  of  car  .... 
Prif  p  of  nowHpr 

I 

6 
I 

1 1 

8 

•y 

4 

67 

4 
I 

Strike  of  employees 
Condition     of     em- 
ployment .... 
Collection  of  union 
dues 

I 

I 

6 

7 

•    •    • 

5 

12 

2 

T 

12 

5 

5 
9 

^liscellaneous . 

6 

I 

•        • 

Totals  .... 

32 

87 

52 

32 

6 

16 

27 

252 

*  Cases  marked  "  withdrawn  "  in  the  foregoing  table  were  for  various  reasons,  the  large  majority 
being  when  the  reply  of  the  operators  to  the  miners'  complaints  plainly  showed  that  there  was  no 
ground  for  complaint.  Others  were  because  of  compromise  by  parties  to  grievance,  failure  of  inter- 
ested parties  to  appear  before  the  Board  to  prosecute  the  cases,  and  complainants'  quitting  the  employ 
of  the  company.  Except  for  1903-1006,  the  records  do  not  show  the  cause  of  withdrawal  except  in  a 
general  recapitulation  (Report  of  Board  of  Conciliation,  1003-1906,  p.  335). 

t  Because  complaints  were  out  of  the  Board's  jurisdiction. 

+  Definite  complaints  to  the  number  of  254  were  made  in  the  period  1903-1913,  the  division 

according  to  periods  being  as  follows : 

Number 
Period  of  Complaints 

1903-1906 143 

1906-1909 26 

1909-1912 26 

1912-1913 59 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       519 

Generally  speaking,  the  award  and  the  subsequent  agreements  may 
be  said  to  have  been  fairly  definite  in  their  provisions.  The  largest 
number  of  grievances  brought  before  the  Board  in  1903-1912  related 
to  wages  and  discrimination  on  account  of  union  affiliation,  145  out 
of  the  total  of  195  being  of  these  two  classes.  The  award  and  the 
agreements  definitely  fixed  the  differentials  existing  in  1902  as  the 
basis  ;  the  questions  coming  up,  therefore,  related  (i)  to  the  differen- 
tials and  other  conditions  in  existence  before  the  award  was  made, 
and  (2)  to  the  method  and  the  extent  of  the  application  of  the  terms 

of  the  award. 

2.  Matters  coming  up  for  settlement  which  could  not  be  disposed  * 
of  by  strict  interpretation  of  the  award  or  of  the  agreements.    Only  ^ 
four  instances  of  this  kind,  apparently,  have  occurred,  but  they  are 
important  because  they  occasioned  or  paved  the  way  for  amendments 
to  agreements.    They  may  be  stated  briefly  as  follows: 

a.  The  supplementing  of  the  1909  agreement  by  a  resolution  of  the 
Board  of  Conciliation  which  provided  for  a  series  of  references  of 
grievances  to  be  followed  before  they  could  be  brought  before  the 
Board  itself.  This  was  a  legislative  act  on  the  part  of  the  Board 
which  had  not  been  specifically  provided  either  in  the  awards  or  in 
the  agreement,  but  which  was  regarded  as  necessary  to  carry  out 
the  spirit  of  the  agreement. 

b.  Several  grievances  alleging  discrimination  by  employers  against 
employees  on  account  of  union  affiliation.  These  involved  a  single 
point,  and  they  were  made  the  subject  of  special  rulings  which 
became  provisions  of  a  later  agreement. 

c.  A  case  involving  the  wages  of  laborers  employed  by  con- 
tract miners.  This  case  was  oTspeciai  importance  because  a  large 
number  of  workers  were  concerned,  and  may  be  reviewed  in  more 

detail. 

The  case  first  came  up  in  May,  1903,  in  a  grievance  from  certain 
laborers  employed  by  contract  miners  for  a  certain  company,^  the 
laborers  requesting  that  the  advance  of  10  per  cent  in  wages  granted 
by  the  Coal  Strike  Commission  should  be  given  to  them  as  well  as  to 
contract  miners.  The  Board  of  Conciliation  upheld  the  miners  in 
their  contention,  but  in  doing  so  it  distinctly  went  beyond  the  pro- 
visions of  the  award.    The  award  of  the  Commission  was  "that  an 

1  Grievance  No.  9 :  Coxe  Brothers  &  Co. 


H 


I 

lii 


;:  ! 


I 


\w 


520       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

increase  of  10  per  cent  over  and  above  the  rate  paid  in  the  month  of 
April,  1902,  be  paid  to  all  contract  miners  for  cutting  coal,  yardage, 
and  other  work  for  which  standard  rates  or  allowances  existed  at  that 
mine,  from  and  after  November  i,  1902,"  etc.  No  mention  of  the 
employees  of  contract  miners  was  made  in  connection  with  increase 
in  wages.  The  petition  of  the  laborers  to  the  Board  of  Conciliation 
in  this  case  asked  that  the  Board  "find  that  it  was  the  intention  of 
the  Anthracite  Coal  Strike  Commission  to  include  the  class  of  mine 
labor  represented"  by  the  petitioners.  The  action  of  the  Board  was 
couched  in  terms  that  made  it  appear  interpretative  rather  than 
amendatory  of  the  award.  "Taking  effect  August  i,  1903,"  said  the 
formal  action  of  the  Board,  "it  is  resolved  by  the  Board  of  Con- 
ciliation, in  its  interpretation  of  the  award  of  the  Anthracite  Coal 
Strike  Commission,  that  contract  miners'  laborers  are  entitled  to 
partake  in  the  benefits  of  the  wage  provisions  of  the  award."  The 
fact  that  contract  miners'  laborers  were  not  regarded  by  the  Com- 
mission as  employees  of  the  operators  was  recognized  in  a  decision  of 
Umpire  Carroll  D.  Wright  in  a  later  case  (Grievance  No.  62,  Sep- 
tember 4,  1903),  in  which  he  said,  "In  regard  to  the  miners'  laborers, 
the  Commission  left  it  entirely  to  the  miners  to  do  justice  to  them. 
This  was  because  the  miners'  laborers  are  not  employees  of  the 
operators,  but  of  the  miners  themselves."  Furthermore,  the  award 
of  the  Commission  was  quite  specific  in  providing  that  the  10  per 
cent  increase  was  to  be  paid  "from  and  after  November  i,  1902." 
The  Board's  ruling  in  regard  to  miners'  laborers,  however,  was  effec- 
tive only  from  and  after  August  i,  1903. 

This  view  of  the  Board's  action  was  taken  by  Umpire  Charles  P. 
Neill  in  a  decision  on  August  26,  19 14  (Grievance  No.  245,  Item  i), 
interpreting  a  provision  of  the  19 12  agreement  relating  to  the 
"standard  rate"  to  be  paid  by  contract  miners  to  their  employees.^ 
In   reviewing    former   decisions   and   actions   relating   to   contract 

^The  decision  in  this  case  was  of  unusual  importance  because  it  involved  the 
contract  system  of  one  of  the  large  mining  companies  (the  Delaware  and  Hud- 
son Coal  Company).  This  company,  instead  of  having  a  contract  with  each 
individual  contract  miner  covering  the  work  of  such  individual  worker,  made 
a  contract  with  a  single  miner  covering  the  mining  of  all  the  coal  in  a  given 
section  of  a  mine  and  requiring  the  work  of  a  number  of  miners  as  well  as 
laborers.  The  decision,  which  was  based  in  part  on  former  decisions  and 
rulings,  directed  the  payment  of  standard  rates  to  miners  and  laborers  employed 
by  contract  miners  and  involved  the  payment  of  large  sums  of  money. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       521 

miners'  employees  Dr.  Neill  said  of  the  ruling  made  by  the  Board 
in  May,  1903 : 

The  Board  of  Conciliation  had  in  its  membership  three  official 
representatives  of  the  miners  when  acting  in  a  collective  capacity. 
In  acting  on  this  grievance,  therefore,  the  Board,  with  the  concur- 
rence of  the  body  of  contract  miners  as  represented  by  their  officials 
on  the  Board,  may  be  regarded  as  making  an  agreement  supple- 
mentary to  the  award  of  the  Commission,  and  thus  doing  justice  to 
the  laborers  of  the  miners  as  it  had  been  left  to  the  miners  to  do 
by  the  Commission,  according  to  the  opinion  of  Umpire  Wright  On 
no  other  hypothesis  can  the  umpire  understand  the  action  of  the 
Board  in  making  its  ruling  effective  August  i,  1903.' 

Since  both  Umpire  Wright  and  Umpire  Neill  were  connected  with 
the  Coal  Strike  Commission  in  official  capacities,  their  views  may 
be  considered  authoritative.  Particularly  significant  is  Dr.  Neill's 
point  that  the  members  of  the  equipartisan  Board  of  Conciliation 
had  the  power  to  bargain  collectively. 

d.  Rates  of  pay.  While  the  Board  of  Conciliation  and  the  umpires 
have  beerTcalT^d  upon  on  a  number  of  occasions  to  decide  what  rates 
should  be  paid  in  new  operations,  their  decisions  have  always,  so 
far  as  it  has  been  possible,  applied  the  differentials  existing  in  col- 
lieries where  similar  work  had  been  done  in  the  past.  In  other  words, 
they  have  merely  interpreted  the  award's  provision  that  "present 
methods  of  payment  for  coal  mined  shall  be  adhered  to,  unless 
changed  by  mutual  agreement"  and  the  1909  agreement's  pro- 
vision that  "the  rates  which  shall  be  paid  for  new  work  shall  not  be 
less  than  the  rates  paid  under  the  Strike  Commission's  award  for  old 
work  of  a  similar  kind  and  nature." 

There  have  been  a  few  instances,  however,  where  the  award  and 
the  agreements  have  not  been  found  applicable  and  interpretations 
have  not  been  adequate.  One  of  these  cases  was  of  ten  years'  stand- 
ing and  involved  a  condition  not  covered  by  existing  differentials. 
In  the  Klondike  vein  at  the  Ontario  Colliery  of  the  Scranton  Coal 
Company  it  was  necessary  to  take  down  top  rock  to  make  the  requi- 
site height  for  mine  cars.  The  rate  paid  for  this  work  was  $2.20 
a  yard.  But  this  vein  and  another  vein  lying  above  it  came  together 
and  formed  one  vein  of  a  considerably  greater  thickness,  with  a  strip 

1  Board  of  Conciliation,  Decision  of  Umpire  in  re  Grievance  No.  245,  Item  i. 


I  • 


I 


I! 


522       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  rock  running  through  the  middle  of  the  vein.  Where  the  two 
veins  merged  there  remained  no  necessity  for  taking  down  top  rock 
where  the  full  height  was  mined,  but  it  then  became  necessary  to 
handle  the  strip  of  rock  between  the  two  veins.  The  company  put 
on  a  new  rate,  and  the  miners  presented  a  grievance.  This  grievance 
was  first  presented  in  October,  1904.^  The  company  claimed  that 
it  had  the  right,  under  the  award,  to  readjust  the  rates  of  com- 
pensation whenever  there  is  a  change  in  the  conditions  under  which 
the  miner  is  working.  The  Board  of  Conciliation  disagreed  and  the 
case  went  to  an  umpire.  The  umpire  held  that  the  case  was  one  to 
which  the  award  of  the  Commission  was  not  applicable  and  the 
grievance  was  not  sustained.  But  the  umpire's  decision  also  stated 
that  "the  question  of  what  rate  should  be  paid  for  the  handling  of 
the  rock  imbedded  in  the  coal  vein  was  a  proper  subject  for  a  new 
agreement."^  The  matter  did  not  come  up  again  until  191 2,  when 
a  grievance  was  presented  by  certain  employees  in  the  Ontario  Col- 
liery that  since  1904  there  has  been  no  fixed  and  agreed-upon  rate 
for  cutting  the  rock  under  question.  Again  the  case  went  to  an 
umpire — it  happened  that  it  was  the  same  umpire.  Dr.  Neill — 
and  the  decision  was  the  same  so  far  as  the  award  and  the  agreement 
were  concerned.  But  instead  of  merely  suggesting  that  the  question 
was  a  subject  for  a  new  agreement,  the  second  decision  specifically 
provided  "  that  as  the  first  step  towards  a  settlement  of  this  grievance, 
the  proper  representatives  of  the  Company  shall  meet  with  the  miners 
working  in  the  chambers  to  which  this  grievance  applies,  or  with  a 
committee  selected  by  these  miners,  and  endeavor  in  good  faith  to 
agree  upon  some  fixed  and  definite  rate  or  rates  to  be  paid  for 
handling  this  rock.  This  first  step  is  directed  in  conformity  with 
the  fourth  award  of  the  Anthracite  Coal  Strike  Commission,  which 
clearly  implies  that  adjustments  of  grievances  shall  first  be  under- 
taken '  by  consultation  between  the  superintendent  or  manager  of  the 
mine  or  mines  and  the  miner  or  miners  directly  interested.'  If  no 
agreement  can  be  reached  as  a  result  of  this  first  step,  then  in  con- 
formity with  subsection  (d)  of  the  agreement  of  May,  19 12,  the 
representative  of  the  Company  shall  meet  with  the  Grievance  Com- 
mittee and  the  member  of  the  Board  of  Conciliation  and  endeavor  to 

1  Report  of  Board  of  Conciliation,  Grievance  No,  128, 
^Ibid.  Grievance  No.  214,  Item  3. 


SETTLEMENTS  IN  ANTHRACITE  INDUSTRY       523 

agree  upon  a  rate  or  rates.  In  the  event  of  a  failure  to  agree,  the 
fixing  of  the  rate  shall  be  referred  to  the  Conciliation  Board ;  and 
when  a  rate  shall  be  finally  agreed  upon,  it  shall  be  retroactive  to  a 
date  ten  days  after  the  date  on  which  this  decision  is  presented  to 
the  meeting  of  the  Conciliation  Board.  It  is  to  be  understood  that 
this  decision  applies  only  to  the  handling  of  what  can  be  properly 
called  ^rock,'  and  that  the  rates  are  to  be  fixed  for  this  only."^ 

A  second  case  involved  the  payment  of  a  large  sum  of  money  by 
the  anthracite  operators.    It  was  of  unusual  importance  because  it 
involved  the  application  of  the  sliding  scale  for  March,  19 12,  the 
last  month  of  the  existence  of  that  method  of  payment,  and  hence 
did  not  constitute  a  specific  precedent.   Apparently  such  a  case  in- 
volved merely  an  interpretation  of  the  1903  award;   in  reality  it 
went  beyond  the  award,  because  it  had  been  found,  in  applying  the 
sliding  scale,  that  the  strict  letter  of  the  award  could  not  be  carried 
out.    The  award  provided  that  each  employer  should  apply  the  in- 
crease in  pay  on  the  earnings  of  the  particular  month  on  the  sales 
of  which  the  sliding  scale  was  calculated ;  the  practice,  however,  was 
adopted  of  paying  the  sliding-scale  increase  by  applying  the  per- 
centage based  on  the  sales  of  a  given  month  on  the  earnings  of  the 
succeeding  month  until  April  i,  191 2,  when  a  suspension  occurred. 
After  work  was  resumed  the  mine  workers  claimed  that  the  increase, 
according  to  the  sliding  scale,  for  the  month  of  March  was  still  due 
them.    Various  questions  arose  as  to  the  method  by  which  this  in- 
crease ought  to  be  paid.    The  umpire,  however,  decided  that  the 
workers  were  entitled  to  receive  the  sliding-scale  increase  as  calculated 
upon  the  basis  of  March  coal  prices.^    It  will  be  noted,  therefore, 
that  this  case  was  one  which  had  to  be  decided  as  a  case  in  equity. 
The  Board  of  Conciliation  failed  to  arrive  at  any  agreement,  and 
the  umpire  was  called  upon  to  act  as  arbitrator. 

Within  the  last  year  or  so  the  introduction  of  a  coal-cutting 
machine  has  caused  the  bringing  up  of  a  question  of  rates  of  pay 
which  apparently  has  no  precedent  or  basis  in  preceding  rulings  and 
decisions.  The  question,  in  the  form  of  a  request  for  rates  of  pay 
higher  than  those  set  by  operators  who  have  installed  the  machine, 

1  Report  of  Board  of  Conciliation,  Grievance  No.  214,  Item  3. 

2  Board  of  Conciliation,  Decision  of  Umpire  in  re  Sliding  Scale  for  March, 
191 2  (rendered  May  i,  1913)- 


•II 


m 


i 


524       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

has  gone  to  the  Board.  The  Board,  in  December,  1914,  failed  to 
agree  on  a  decision  and  the  matter  went  to  Umpire  George  Gray. 
In  this  case  the  conciliation  and  arbitration  machinery  provided  by 
the  agreement  has  thus  been  called  upon  to  act  on  a  fundamental 
question  which  is  not  covered  by  the  award  or  the  subsequent  agree- 
ments. It  is  significant  that  the  191 5  demands  of  the  tri-district 
convention  of  the  United  Mine  Workers  include  one  for  "a  readjust- 
ment of  the  machine-mining  scale." 

The  191 5  demands,  as  has  already  been  suggested,  reflect  the 
situation  which  has  been  created  by  the  occurrence  of  such  matters 
as  these.  Two  distinct  clauses  in  these  demands  indicate  a  desire 
on  the  part  of  the  mine  workers  to  change  the  conciliation  machinery 
to  meet  the  situation.   They  are  as  follows : 

9.  We  demand  a  readjustment  of  the  machine-mining  scale  to  the 
extent  that  equitable  rates  and  conditions  shall  obtain  as  a  basis  for 
this  system. 

10.  We  demand  that  arrangements  of  detailed  wage  scales  and  the 
settlement  of  internal  questions,  both  as  regards  prices  and  condi- 
tions, be  referred  to  the  representatives  of  the  operators  and  miners 

^of  each  district  to  be  adjusted  on  an  equitable  basis. 

The  trend  is  thus  toward  clothing  the  system  of  conciliation  and 
arbitration  with  more  definite  and  greater  authority  to  settle  funda- 
mental questions  of  wages  and  conditions  of  labor.  For  over  twelve 
years  these  questions  have  been  regarded  as  settled  by  the  1903 
award,  except  where  situations  have  arisen  which  forced  interpreta- 
tions that  were  essentially  supplementary  agreements.  It  is  now 
proposed  to  get  farther  away  from  the  1903  award  as  the  constitution 
of  industrial  relations,  to  make  the  agreement  the  real  constitution, 
and  to  transform  the  conciliation  machinery  into  a  more  responsible 
and  more  responsive  legislative  body. 

Edgar  Sydenstricker 

Washington,  D.  C. 


XXXIV 

EQUALIZING  COMPETITIVE  CONDITIONS^ 

W[THOUT  going  too  much  into  details  of  the  organizations 
known  as  the  Illinois  Coal  Operators'  Association,  on  the  one 
hand,  and  District  Number  12  of  the  United  Mine  Workers  of  Amer- 
ica, on  the  other,  it  must  be  understood  that  the  basis  of  the  agree- 
ment between  them  is  that  of  a  protected  competitive  existence  for 
all.  The  rates  of  mining  are  so  fixed  that  the  coal  operators  can  do 
business.  That  is  the  first  and  basic  proposition.  Naturally  the  rank 
and  file  of  the  miners  expected  a  scale  which  would  enable  them  to 
earn  a  practically  uniform  wage  throughout  the  state.  The  leaders, 
however,  contended  that  the  first  object  of  the  scale  was  to  permit 
every  mine  to  run  and  get  into  the  market,  and  that  all  other  ques- 
tions must  be  subservient  to  this.  The  first  clause  of  the  joint 
declaration  of  principles  says:  "This  joint  movement  is  founded 
and  is  to  rest  upon  correct  business  ideas,  competitive  equality,  and 
well-recognized  principles  of  justice."  This  involves  a  consideration 
of  railroad  rates  to  market  points,  conditions  of  the  coal  mined,  etc. 

The  effect  of  the  strike  of  1897,  which  was  successful  not  only  in 
Illinois  but  throughout  the  competitive  bituminous  field,  was  to 
bring  into  prime  importance  the  interstate  conferences  and  agree- 
ments. In  the  interstate  convention  the  operators  of  Illinois,  Indiana, 
Ohio,  and  western  Pennsylvania  are  represented,  and  the  rates  of 
mining  and  the  conditions  are  fixed  in  that  convention  for  all  points 
on  a  competitive  basis ;  that  is,  so  that  each  operator  shall  have  a 
chance  to  mine  coal  and  get  it  to  his  market.  For  Illinois  the  con- 
vention fixes  only  the  price  at  Danville,  Illinois,  which  is  thereby 
made  the  basing  point  for  the  state.  The  Illinois  Coal  Operators' 
Association  and  the  representatives  of  the  mine  workers  of  Illinois 
then  meet  in  joint  convention  and  adjust  the  rates  throughout  the 
state  in  accordance  with  the  Danville  rate. 

iFrom  Eleventh  Special  Report,  U.S.  Commissioner  of  Labor,  1904,  pp.  390- 


394- 


52s 


* 


52  6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

At  the  interstate  convention  which  followed  the  strike  of  1897  the 
Illinois  miners  demanded  a  mine-run  basis  for  Illinois  and  threatened 
to  renew  the  strike  if  this  was  not  conceded.  That  convention  then 
fixed  the  mining  price  at  37  cents  a  ton  for  hand  mining,  run-of-mine 
coal,  with  a  differential  of  10  cents  a  ton  run-of-mine  for  machine 
mining.  That  is,  the  companies  were  to  pay  27  cents  a  ton  for 
machine-mined  coal  in  the  Danville  district  and  37  cents  a  ton 
for  hand-mined  coal,  the  other  rates  in  Illinois  to  be  fixed  compet- 
itively upon  this  basis.  The  Illinois  joint  conference  of  employers 
and  miners  met  in  Chicago  in  1897  and  adjusted  the  rates  throughout 
the  state. 

The  Illinois  Coal  Report  for  1897  shows  the  effects  of  the  equaliz- 
ing principle  on  different  sections  of  the  state.  In  the  northern,  or 
thin-vein  fields,  the  prices  per  gross  ton  were  advanced  14  to  20  per 
cent,  while  in  the  southern,  or  thick-vein  fields,  the  advance  was  20 
to  55  per  cent.  The  prices  in  the  northern  fields  had  been  near  50 
cents  per  ton  and  in  the  southern  fields  20  to  25  cents  per  ton.  At 
these  rates  the  miners  in  the  southern  fields  had  earned  as  high  wages 
as  those  in  the  northern  fields,  but  the  advances  following  the  strike 
placed  the  two  sections  nearer  an  equality  in  the  cost  of  mining, 
but  enabled  miners  in  the  southern  fields,  without  restrictions 
on  their  output,  to  earn  much  higher  wages  than  miners  in  the 
northern  fields. 

Perhaps  the  best  statement  of  the  principle  underlying  the  Illinois 
agreement  was  made  by  Mr,  Moorshead,  a  southern  Illinois  operator, 
who  has  had  to  surrender  as  much  of  the  natural  advantages  of  his 
position  as  anyone,  in  his  reply  to  the  miners  of  the  Pekin  mine  who 
wanted  increased  compensation  for  the  increased  amount  of  dead 
work  in  that  district.  This  was  in  the  joint  convention  of  1902,  held 
in  Peoria,  and  his  words  throw  a  flood  of  light  upon  this  subject  of 
the  basis  of  agreement : 

...  Go  into  the  northern  field  and  the  miners  must  suffer  very 
much  there  as  compared  with  the  miner  in  the  thick  seam.  When 
you  get  into  the  thick  part  of  the  No.  6  seam  the  operator  suffers. 
You  penalize  him  in  his  good  conditions  that  he  may  not  drive  the 
more  unfortunate  operator  with  his  thin  seam  out  of  the  market.  .  .  . 

We  have  banded  together  here  so  that  the  operators  in  every  dis- 
trict might  exist,  notwithstanding  the  different  conditions  that  pre- 
vail; and  so  long  as  we  work  on  these  lines  some  miners  will  have 


EQUALIZING  COMPETITIVE  CONDITIONS         527 

to  accept  less  wages  than  others.  So  long  as  we  work  on  competitive 
lines  some  operators  will  have  to  receive  less  compensation  than  they 
are  really  entitled  to.  .  .  . 

Mr.  John  Mitchell,  replying  for  the  miners,  said: 

I  quite  agree  with  Mr.  Moorshead  that  in  determining  the  rate 

you  have  to  take  into  consideration  the  competitive  conditions.    I 

I  think  he  will  agree  with  me,  however,  that  there  are  considerations 

•that  enter  even  into  that.   Where  conditions  are  abnormal  in  a 

vein,  that  has  always  been  a  consideration  in  determining  the  scale 

of  wages. 

'  In  the  convention  of  1900,  held  in  Springfield,  a  miner  proposed 
that  an  extra  rate  be  put  on  for  mining  in  wet  mines.  "When  men 
must  work,"  he  said,  "in  water  up  to  their  knees  all  day  long  and 
every  day  in  the  month,  it  is  expected  that  they  will  be  compensated 
for  it ;  where  men  have  perfectly  dry  work  we  are  satisfied  with  the 
scale."  It  was  agreed  that  no  operator  ought  to  permit  his  mines  to 
run  in  that  condition  and  that  miners  ought  to  have  more  wages 
under  such  conditions,  and  that  to  put  an  extra  mining  rate  on  wet 
mines  might  force  the  merely  careless  operator  to  improve  his  mines, 
but  "it  is  a  question  whether  you  would  not  bring  those  parties  into 
such  a  condition  that  they  could  not  compete  with  their  neighbors. 
They  are  in  the  same  markets,"  and  so  the  matter  was  dropped. 

The  machine  question,  also,  divides  and  weakens  the  operators  in 
their  resistance  to  the  union.  There  are  915  mines  in  the  state,  but 
only  332  of  these  are  "commercial"  or  "shipping"  mines,  producing 
96  per  cent  of  all  the  coal  and  employing  93  per  cent  of  the  mine 
workers.  Of  these  shipping  mines  only  64  used  coal-cutting  machines 
exclusively  or  in  part  in  1902.  These  mines  are  concentrated  in  the 
hands  of  some  30  companies.  Against  these  30  companies  are  300 
companies  not  using  machinery,  because  the  nature  of  their  coal 
seams  does  not  make  it  practicable.  The  question  is  mainly  one  of 
the  thickness  of  the  seams  and  the  nature  of  the  roof.  Coal  measures 
in  Illinois  range  from  one  foot  to  nine  feet  in  thickness.  The  thin 
veins  are  in  the  northern  sections  and  the  thick  veins,  for  the  most 
part,  in  the  central  and  southern  sections. 

The  distribution  of  machines  reveals  the  significance  of  the  state- 
ment made  by  the  general  manager  of  a  company  operating  exten- 
sively in  the  southern  fields: 


i 


I: 


i  ■ 


528       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  operators  were  whipped  to  a  standstill.  Impoverished  by  our 
insane  price-ctitting  and  the  long  period  of  hard  times,  threatened 
with  a  total  loss  of  all  our  markets  on  the  very  eve  of  returning  good 
times,  we  simply  had  to  take  our  medicine.  We  were  compelled  not 
only  to  submit  to  any  terms  the  miners'  union  saw  fit  to  impose,  but 
to  join  the  Illinois  Coal  Operators'  Association,  where  we  are  out- 
voted and  made  to  seem  to  be  unanimously  opposed  to  ourselves.  .  .  . 
Oh,  yes,  it  is  a  voluntary  association,  of  course,  and  votes  as  a  unit 
in  conferences,  of  course.  .  .  .  Well,  I  will  say  only  this :  We  were 
whipped  into  this  voluntary  happiness  by  the  strike  of  1897,  and 
we  don't  dare  to  get  out  of  it. 

And  the  same  natural  advantages  of  the  southern  fields  for  the  use 
of  the  machines  add  force  to  the  vigorous  opinion  of  a  miner  whose 
relations  with  the  union  he  desired  not  to  have  mentioned.  How 
far  his  opinion  is  shared  by  other  miners  in  the  state  there  is  no 
means  of  knowing.    He  said : 

Of  course  you  can  get  more  coal  from  an  undercut  in  an  eight- 
foot  seam  than  you  can  in  a  five-  or  six-foot  seam.  The  thick-vein 
fellows  were  whipped  into  the  competition  agreement  by  a  strike. 
Some  of  them  thought  to  best  the  game  on  the  sly  by  virtue  of 
natural  advantages,  and  are  mad  because  they  have  met  with  ob- 
structions and  are  forced  to  give  the  other  properties  a  chance. 
Did  you  ever  think  that  God  Almighty  restricts  the  output  of  sun- 
shine 50  per  cent  to  give  the  moon  a  chance?  If  you  will  promise 
to  report  exactly  what  I  say  I  will  say  that  we  are  willing  to  submit 
our  case  to  the  people  of  the  United  States  and  to  admit  that  some 
of  the  thick-vein  companies  do  not  get  all  the  coal  it  would  be 
possible  to  take  out  of  their  mines  at  all  times.  The  state  officials, 
and  the  local  unions,  as  such,  have  nothing  to  do  with  this.  The 
coal  just  don't  come  up.  But  the  question  is  this :  Shall  20  or  30 
mines,  owned  by  four  or  five  companies,  employing  6000  men,  be 
permitted,  because  of  natural  advantages  they  did  not  create — shall 
they  be  permitted  to  close  down  890  other  mines,  owned  by  275  other 
firms,  and  employing  39,000  other  men?  I  for  one  am  willing  to 
go  before  the  people  of  Illinois  with  this  proposition :  If  we  must 
restrict  the  output  of  a  score  of  eight-foot  mines  in  order  to  increase 
by  millions  of  tons  the  output  of  Illinois  coal  mines  as  a  whole,  are 
we  not  justified  from  every  point  of  view  except  that  of  the  three 
or  four  companies  owning  eight-foot  mines  in  doing  so  ? 

This  much  is  stated  in  order  that  the  machine  question  in  the 
Illinois  coal  fields  may  be  readily  understood.  It  must  be  added  that 
the  "pick"  operators — that  is,  operators  of  mines  without  machines 


?f 


EQUALIZING  COMPETITIVE  CONDITIONS  529 

—stoutly  contend  that  they  do  not  sympathize  with  any  policy  of 
handicapping  the  machines,  but  it  will  also  appear  that  the  mine 
workers  in  their  joint  conferences  take  advantage  of  the  division  of 
the  operators  on  this  point.  The  whole  question,  it  will  readily  be 
seen,  is  a  detail  of  the  large  policy  of  equalizing  competitive  conditions. 

In  Illinois  the  machine  differential  was  made  7  cents  for  the  entire 
state  as  a  result  of  the  strike  of  1897.  In  1898  the  national  president 
of  the  interstate  convention  granted  the  Danville  district  a  lo-cent 
differential.  The  Illinois  officials  claim  that  7  cents  is  the  average 
differential  found  to  prevail  under  nonunion  conditions  in  Illinois, 
taking  the  coal  seams  in  which  the  machine  had  been  able  to  hold 
its  own  under  nonunion  or  open  conditions.  They  claim  that  not 
only  is  this  the  average  difference  in  cost  the  operators  were  able 
to  establish  but  also  that  it  is  sufficient  to  justify  the  introduction  of 
machines  where  machines  are  practicable,  and  that,  furthermore, 
it  is  all  the  machines  are  worth  to  the  mines. 

A  general  statement  of  differentials  for  the  competitive  field  is 
here  subjoined,  based  upon  the  prices  paid  in  each  locality  in  1902- 
1903.  Changes  in  rates  since  agreed  upon  have  been  made  upon 
practically  the  same  ratio  throughout  the  field. 

Mining  Rates  showing  Machine  Differentials  according  to  the 
Interstate  Agreement  for  the  Year  beginning  April  i,  1902 

(Ton  =  2000  pounds) 


Hand  (Pick) 
Mining 

Chain-Machine 
Mining 

Pick-  (or  Punch-) 
Machine    Mining 

Rate 

Rate 

Rate 

Lump 

Mine  Run 

Liunp 

Mine  Run 
$0.3426 

Lump 

Mine  Run 

Pennsylvania .    . 

$0.8000 1 

$0.5171 

$0.5300 

$0.5768 

$0.3716 

(Pittsburgh 
district)  .    .    . 

.66802 

.4318 

.4420 

.2856 

.4780 

.3089 

Ohio  (Hocking 

Valley)   .    .    . 
Indiana  .... 

.8000 
.8000 

•57U 
.4900 

.5300 
.5850 

•3786 
•3650 

•5750 
.6200 

.4107 
.3900 

Illinois  .... 

(Danville   dis- 
trict) .    .    .    . 

.4900 

.3900 

.3900 

] 

^  Thin  vein 

■ 

2  Thick 

vein. 

I  •  i 


* 


A  iiii 


530       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  opening  the  "  interstate  convention  and  sixth  annual  joint  con- 
ference of  coal  miners  and  operators  of  Illinois,  Indiana,  Ohio,  and 
Pennsylvania"  for  1903,  Mr.  John  Mitchell,  as  president  of  the 
United  Mine  Workers  of  America,  said: 

Last  year  the  attention  of  the  operators  was  called  to  the  inequal- 
ities that  exist  in  our  interstate  agreement.  I  can  do  no  more  than 
repeat  in  substance  what  I  said  on  this  subject  last  year.  We  believe 
the  time  is  here  when  there  should  be  an  adjustment  of  our  machine- 
mining  scale.  Our  movement  cannot  live  with  any  degree  of  satis- 
faction if  we  are  going  to  have  three  or  four  different  prices  for 
mining  coal  by  machinery.  The  introduction  of  mining  machinery 
and  the  prices  paid  for  mining  coal  by  machinery  must  be  so  adjusted 
that  labor  will  enjoy  a  share  of  the  benefits  and  profits  that  come 
from  the  introduction  of  improved  methods.  .  .  .  We  believe  also 
that  there  should  be  a  fixed  and  flat  differential  for  machine  coal. 
We  believe  that  the  experience  of  the  operators  and  miners  in  Illinois 
is  such  as  to  justify  us  in  asking  that  that  differential  be  fixed  at 
7  cents  a  ton. 

The  constant  endeavor  of  the  union  has  been  to  bring  all  the 
states  to  an  equivalent  of  the  7-cent  differential. 

As  heretofore  shown,  the  mining  machines  are  used  almost  exclu- 
sively in  the  southern  districts  of  the  state,  where  the  veins  are  thick 
and  adapted  to  the  use  of  machines.  Operators  in  these  districts 
complain  not  only  of  the  differential  but  also  of  definite  restrictions 
on  the  output  of  the  machines.  These  complaints  take  the  form  of 
charging  the  union  with  limiting  the  number  of  loaders  after  the 
machine  and  with  preventing  the  machine-runner  from  cutting  more 
coal  than  the  loaders  can  handle  by  setting  a  limit  on  the  number  of 
runs  and  by  equalizing  the  turns.  These  grievances  are  stated  at 
length  in  an  interview  by  the  general  manager  of  a  company  operat- 
ing several  mines  in  the  southern  fields  of  Illinois  and  in  other  states 
in  which  punching  machines  are  used.    He  says: 

To  go  into  details,  and  taking  the  Mount  Olive  shaft,  where  a 
Harrison  (pick)  machine  is  used,  the  crew  consists  of  one  runner, 
one  helper,  seven  loaders  —  number  fixed  by  unions.  They  work 
ostensibly  eight  hours,  but  seldom  or  never  actually  that  number. 
The  rate  is  42  cents  per  ton,  or  7  cents  less  than  hand-mine  rates. 
This  42  cents  is  divided  as  follows:  machine-runner,  5.5  cents; 
helper,  5  cents  ;  loaders,  31.5  cents.  This  division  of  the  mining  rates, 
42  cents,  between  the  machine  men  and  the  loaders  is  attended  to  by 


EQUALIZING  COMPETITIVE  CONDITIONS  53^ 

them,  the  company  having  no  voice  in  the  matter  in  such  division, 
with  the  result  that  the  machine-runners  get  the  worst  of  it,  and  the 
loaders,  being  in  the  majority,  outvote  them  m  the  unions,  thus 
placing  what  amounts  to  a  handicap  upon  securing  men  to  run  the 
machine  The  loaders  load  nine  tons  per  day  at  this  shaft,  and  this 
limits  the  machine-since  the  runner  has  no  incentive  to  cut  more 
than  will  be  loaded— to  sixty-three  tons  per  day  (mne  men  to  the 
crew,  output  sixty-three  tons,  gives  an  average  of  seven  tons  per  day 
per  man)  These  restrictions  prevent  the  employment  of  speedy 
workmen  or  at  least  of  workmen  for  their  speed,  and  hold  down  the 
speed  of  speedy  men  to  afford  employment  for  as  many  men  as  pos- 
sible These  restrictions  are  enforced  by  fines,  or  more  common  y 
by  the  union  laying  the  men  off  as  a  punishment.  The  fine  usually 
amounts  to  the  excess  earnings.  .  .  . 

Mr.  Reynolds,  afterwards  the  state  president  of  the  Illinois  Mine 
Workers'  Union,  as  spokesman  for  the  miners,  replied  to  the  charges 
of  restriction  as  follows: 

Mr.  Chairman  and  gentlemen,  in  answer  to  the  charges  preferred 
against  the  Illinois  miners  by  the  Illinois  operators,  I  wish  to  say 
that  in  the  first  place  they  are  charged  with  restricting  the  output  of 
the  mines  of  Illinois,  first,  by  neglecting  their  work ;  second,  by 
adopting  a  svstem  of  so  many  cars  a  day  ;  third,  by  adopting  the  rule 
of  so  many  miners  after  a  machine  in  the  machine  mines  of  Illinois. 
Now,  friends,  referring  to  the  first  charge.  .  .  .  When  that  com- 
plaint was  made  against  the  Illinois  miners  two  years  ago,  m  order  to 
protect  the  operators,  we  inserted  a  clause  in  our  state  agreement 
which  gives  the  operators  the  right  to  discharge  any  member  of  our 
organization  who  lays  out  two  days  in  succession,  unless  his  absence 
from  the  mine  is  caused  from  sickness  or  he  gets  permission  from  the 
mine  manager.    I  believe  the  operators  have  taken  advantage  of 

that  clause.  .    .       ,  t.       r 

Second,  I  wish  to  say  in  regard  to  restricting  the  number  of  cars 
each  man  should  load  in  the  mine,  that  possibly  in  a  few  mines  m 
the  state  of  Illinois  that  may  be  a  practice,  but  I  propose  to  explain 
to  you  the  reason  why.  Under  our  state  agreement  the  burden  of 
giving  to  each  and  every  miner  an  equal  turn  of  the  mine  rests  upon 
the  shoulders  of  the  operators.  In  some  mines  they  have  appealed 
to  them  time  and  again  in  order  to  secure  what  they  were  entitled 
to  under  the  agreement,  and  as  a  last  resort  in  those  mines  they  were 
forced  to  place  a  restriction  in  order  to  get  an  equal  turn  of  the 
mine.  Before  that  thev  were  always  careful  to  figure  the  output  of 
the  mine  and  then  divide  it  between  the  number  of  men  working  m 
that  mine,  thereby  guaranteeing  that  while  every  man  got  an  equal 
turn,  the  output  of  that  mine  was  not  reduced  one  ton.    That  is 


;iP, 


■T 


i 


' 


532       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

why  restrictions  have  been  placed  in  a  few  mines.  Wherever  restric- 
tions were  placed  for  any  other  purpose  our  organization  has  always 
taken  a  stand  against  it  and  compelled  the  men  to  wipe  it  off  their 
books  if  passed  by  their  locals. 

In  regard  to  the  number  of  men  after  a  machine,  I  will  say  that 
rule  was  established  when  there  was  no  union  in  the  state  of  Illinois. 
That  system  is  as  old  as  machine  mining  is  in  the  state  of  Illinois, 
and  the  operators  have  not  protested  against  it  in  any  other  district 
or  state  conventions.  I  cannot  understand  why  they  should  come 
here  and  enter  a  protest  against  something  that  has  been  going  on 
in  the  state  of  Illinois  for  over  twenty  years  to  my  knowledge. 

In  the  foregoing  sections,  treating  of  the  machine  question,  it 
appears  that  the  equalization  of  turns  is  one  of  the  means  by  which 
the  output  of  machines  is  restricted,  though  not  designed  for  that 
purpose.  Since,  however,  equalization  of  turns  prevails  in  pick  mines 
as  well  as  machine  mines,  the  treatment  of  the  subject  and  its  bear- 
ing on  output  will  be  taken  up  apart  from  the  treatment  of  machines. 

The  Illinois  agreement  contains  the  following  sections : 

Twenty-eighth.  The  operator  shall  see  that  an  equal  turn  is 
offered  each  miner,  and  that  he  be  given  a  fair  chance  to  obtain  the 
same.  The  checkweighman  shall  keep  a  turn  bulletin  for  the  turn- 
keeper's  guidance.  The  drivers  shall  be  subject  to  whomever  the 
mine  manager  shall  designate  as  turn-keeper  in  pursuance  hereof. 

In  mines  where  there  is  both  hand  and  machine  mining  an  equal 
turn  shall  mean  approximately  the  same  turn  to  each  man  in  the 
machine  part  of  the  mine,  and  approximately  the  same  turn  to  each 
man  doing  hand  work ;  but  not  necessarily  the  same  to  each  hand 
miner  as  to  each  man  working  with  the  machine. 

The  subdistrict  agreements  are  as  a  rule  silent  upon  the  subject, 
as  most  of  the  Illinois  mines  have  free  turns,  or  an  unlimited-turn 
system.  That  is  to  say,  where  each  man  can  get  all  the  cars  he  wants 
to  load  he  has  no  objection  to  other  men's  wanting  and  getting  more. 
The  third-vein  subagreement  in  Illinois  says : 

Except  in  the  case  of  a  closed  room  or  room  driven  for  air,  or  when 
an  unlimited  turn  prevails,  no  miner  shall  have  a  "  free  turn,'^  either 
day  or  night,  or  more  than  his  share  of  cars. 

The  equality  of  opportunity  in  the  mines,  or  of  "turn,"  which 
means  number  of  cars  brought  to  the  face  of  a  miner's  working-place 
in  a  given  time,  is  one  of  the  sticking  points  with  a  miner.   His 


EQUALIZING  COMPETITIVE  CONDITIONS  533 

education  upon  this  point  dates  from  years  ago  when,  under  a  system 
of  "truck  stores"  or  "company  houses,"  it  is  claimed  the  miner  who 
did  not  live  in  a  company  house  or  deal  at  the  company  store,  or  some 
store  where  the  company  got  a  commission  on  sales,  did  not  get 
enough  cars  to  fill  during  the  day  to  pay  him  for  going  into  the  mine. 
There  have  been  times  in  Illinois,  and  elsewhere,  when  a  miner  would 
stay  all  day  in  a  mine  and  never  get  a  pit  car  to  load.  Discrimination 
against  individuals  in  the  matter  of  "turns"  was  used  to  drive  men 
who  had  been  active  in  strikes,  or  organizations,  out  of  the  mines.  It 
was  more  subtle,  more  effective,  and  less  likely  to  become  public 
than  a  blacklist.  Moreover,  the  pit  boss  could  use  it  to  get  even 
with  men  personally  distasteful  to  him.  One  acquainted  with  the 
abuses  of  "turns"  practiced  upon  miners  in  former  years  cannot 
wonder  that  those  abuses  have  had  the  effect  of  making  the  miners 
very  uncompromising  on  this  point.  Overcrowding  of  mines  and  the 
advent  of  the  "tonnage-getter,"  added  to  the  old  objections  to  free 
turns,  make  it  difficult  for  the  average  miner  to  see  that  he  is  not 
surrendering  his  opportunity  to  live  to  the  mere  whim  or  like  or  dis- 
like of  a  mine  manager  or  a  pit  boss  when  he  surrenders  his  right 
to  equal  turns  of  pit  cars  in  a  mine. 

Ethelbert  Stewart 


United  States  Department  of  Labor, 
Bureau  of  Labor  Statistics 


•'it 
it 


1^ 


XXXV 

THE  HART  SCHAFFNER  &  MARX  LABOR 

AGREEMENT^ 

THE  parties  whose  names  are  signed  hereto  purpose  entering  into 
an  agreement  for  collective  bargaining  with  the  intention  of 
agreeing  on  wage  and  working  conditions  and  to  provide  a  method 
for  adjusting  any  differences  that  may  arise  during  the  term  of 
this  contract. 

In  order  that  those  who  have  to  interpret  this  instrument  may 
have  some  guide  as  to  the  intentions  and  expectations  of  the  parties 
when  entering  into  this  compact,  they  herewith  make  record  of  their 
spirit  and  purpose,  their  hope  and  expectations,  so  far  as  they  are 
now  able  to  forecast  or  state  them. 

On  the  part  of  the  employer  it  is  the  intention  and  expectation 
that  this  compact  of  peace  will  result  in  the  establishment  and  main- 
tenance of  a  high  order  of  discipline  and  efficiency  by  the  willing 
cooperation  of  union  and  workers  rather  than  by  the  old  method  of 
surveillance  and  coercion ;  that  by  the  exercise  of  this  discipline  all 
stoppages  and  interruptions  of  work  and  all  willful  violations  of 
rules  will  cease;  that  good  standards  of  workmanship  and  conduct 
will  be  maintained  and  a  proper  quantity,  quality,  and  cost  of  pro- 
duction will  be  assured ;  and  that  out  of  its  operation  will  issue  such 
cooperation  and  good  will  between  employers,  foremen,  union,  and 
workers  as  will  prevent  misunderstanding  and  friction  and  make  for 
good  team  work,  good  business,  mutual  advantage,  and  mutual  respect. 

On  the  part  of  the  union  it  is  the  intention  and  expectation  that 
this  compact  will,  with  the  cooperation  of  the  employer,  operate  in 
such  a  way  as  to  maintain,  strengthen,  and  solidify  its  organization, 
so  that  it  may  be  made  strong  enough,  and  efficient  enough,  to 

1  Published  by  the  company,  iqi6.  J.  E.  Williams,  Chairman  of  the  Board 
of  Arbitration.  See  Earl  Dean  Howard,  "The  Development  of  Government  in 
Industry,"  Illinois  Law  Review,  Vol.  X  (1916),  pp.  567-573- 

534 


II 


HART  SCHAFFNER  &  MARX  AGREEMENT         535 

cooperate  as  contemplated  in  the  preceding  paragraph;  and  also 
that  it  may  be  strong  enough  to  command  the  respect  of  the  employer 
without  being  forced  to  resort  to  militant  or  unfriendly  measures. 

On  the  part  of  the  workers  it  is  the  intention  and  expectation 
that  they  pass  from  the  status  of  wage  servants,  with  no  claim  on 
the  employer  save  his  economic  need,  to  that  of  self-respecting 
parties  to  an  agreement  which  they  have  had  an  equal  part  with  him 
in  making ;  that  this  status  gives  them  an  assurance  of  fair  and  just 
treatment  and  protects  them  against  injustice  or  oppression  of  those 
who  may  have  been  placed  in  authority  over  them ;  that  they  will 
have  recourse  to  a  court,  in  the  creation  of  which  their  votes  were 
equally  potent  with  that  of  the  employer,  in  which  all  their  griev- 
ances may  be  heard  and  all  their  claims  adjudicated;  that  all 
changes  during  the  life  of  the  pact  shall  be  subject  to  the  approval 
of  an  impartial  tribunal,  and  that  wages  and  working  conditions  shall 
not  fall  below  the  level  provided  for  in  the  agreement. 

The  parties  to  this  pact  realize  that  the  interests  sought  to  be 
reconciled  herein  will  tend  to  pull  apart,  but  they  enter  it  in  the  faith 
that  by  the  exercise  of  the  cooperative  and  constructive  spirit  it  will 
be  possible  to  bring  and  keep  them  together.  This  will  involve  as 
an  indispensable  prerequisite  the  total  suppression  of  the  militant 
spirit  by  both  parties  and  the  development  of  reason  instead  of  force 
as  the  rule  of  action.  It  will  require  also  mutual  consideration  and 
concession,  a  willingness  on  the  part  of  each  party  to  regard  and 
serve  the  interests  of  the  other,  so  far  as  it  can  be  done  without  too 
great  a  sacrifice  of  principle  or  interest.  With  this  attitude  assured 
it  is  believed  no  differences  can  arise  which  the  joint  tribunal  cannot 
mediate  and  resolve  in  the  interest  of  cooperation  and  harmony. 

• 

SECTION  I.    ADMINISTRATION 

This  agreement  is  entered  into  betwesn  Hart  Schaffner  &  Marx, 
a  corporation,  and  the  Amalgamated  Clothing  Workers  of  America, 
and  is  effective  from  May  i,  1916,  to  April  30,  1919. 

Officers  of  the  Agreement 

The  administration  of  this  agreement  is  vested  in  a  Board  of 
Arbitration  and  a  Trade  Board,  together  with  such  deputies,  officials, 


n 


i 


536       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

and  representatives  of  the  parties  hereto  as  are  now  or  hereafter 
may  be  appointed  for  that  purpose,  whose  duties  and  powers  are 
hereinafter  described. 


Board  of  Arbitration 

The  Board  of  Arbitration  shall  have  full  and  final  jurisdiction 
over  all  matters  arising  under  this  agreement,  and  its  decisions 
thereupon  shall  be  conclusive. 

It  shall  consist  of  three  members,  one  of  whom  shall  be  chosen 
by  the  union,  one  by  the  company,  and  the  third  shall  be  the  mutual 
choice  of  both  parties  hereto  and  shall  be  the  chairman  of  the  Board. 
It  is  agreed  that  the  Board  as  constituted  under  the  old  agreement 
shall  be  continued  during  the  present  agreement,  William  O.  Thomp- 
son being  the  choice  of  the  union,  Carl  Meyer  the  choice  of  the 
company,  and  J.  E.  Williams,  chairman,  being  chosen  by  agreement 
of  both  parties. 

It  shall  be  the  duty  of  the  Board  to  investigate,  and  to  mediate 
or  adjudicate,  all  matters  that  are  brought  before  it  and  to  do  all  in 
its  power  to  insure  the  successful  working  of  the  agreement.  In 
reaching  its  decisions  the  Board  is  expected  to  have  regard  to  the 
general  principles  of  the  agreement ;  the  spirit  and  intent,  expressed 
or  implied,  of  the  parties  thereto ;  and,  especially,  the  necessity  of 
making  the  instrument  workable,  and  adaptable  to  varying  needs  and 
conditions,  while  conserving  as  fully  as  possible  the  essential  interests 
of  the  parties  involved. 

The  line  of  practice  already  developed  by  the  Board  shall  be 
continued.  This  contemplates  that  questions  of  fact  and  testimony 
shall  in  the  main  be  considered  by  the  Trade  Board,  while  the  Board 
of  Arbitration  will  concern  itself  mainly  with  questions  of  principle 
and  the  application  of  the  agreement  to  new  issues  as  they  arise. 
But  this  is  not  to  be  construed  as  limiting  the  power  of  the  Board, 
which  is  broad  enough  to  make  it  the  judge  of  facts  as  well  as 
principle  when  necessary  and  to  deal  with  any  question  that  may 
arise  whose  disposition  is  essential  to  the  successful  working  of  the 
agreement. 

By  agreement  between  the  chief  deputies  cases  may  be  heard  and 
decided  by  the  chairman  of  the  Board  alone. 


HART  SCHAFFNER  &  MARX  AGREEMENT         537 


41 


Emergency  Powers 

If  there  shall  be  a  general  change  in  wages  or  hours  in  the  clothing 
industry  which  shall  be  sufficiently  permanent  to  warrant  the  belief 
that  the  change  is  not  temporary,  then  the  Board  shall  have  power 
to  determine  whether  such  change  is  of  so  extraordinary  a  nature  as 
to  justify  a  consideration  of  the  question  of  making  a  change  in  the 
present  agreement,  and,  if  so,  then  the  Board  shall  have  power  to 
make  such  changes  in  wages  or  hours  as  in  its  judgment  shall  be 
proper. 

Trade  Board 

The  Trade  Board  is  the  primary  board  for  adjusting  grievances, 
and  shall  have  original  jurisdiction  over  all  matters  arising  under 
this  agreement  and  the  decisions  relating  thereto,  and  shall  consider 
and  dispose  of  all  such  matters  when  regularly  brought  before  it, 
subject  to  such  rules  of  practice  and  procedure  as  are  now  or  may  be 
hereafter  established. 

The  Board  shall  consist  of  eleven  members,  all  of  whom,  except- 
ing the  chairman,  shall  be  employees  of  Hart  Shaffner  &  Marx. 
Five  members  shall  be  chosen  by  the  company  and  five  by  the  union, 
and  it  is  understood  that  these  shall  be  selected  in  such  manner  as 
to  be  representative  of  the  various  departments— cutting  and  trim- 
ming, coat,  vest,  and  trousers. 

The  Board  shall  be  presided  over  by  a  c'  airman  who  shall  rep- 
resent the  mutual  interests  of  both  parties  hereto,  and  especially  the 
interest  of  the  successful  working  of  this  agreement.  He  shall  pre- 
side at  meetings  of  the  Board,  assist  in  investigation  of  complaints, 
endeavor  to  mediate  conflicting  interests,  and  in  case  of  disagree- 
ment shall  cast  the  deciding  vote  on  questions  before  the  Board. 
He  shall  also  act  as  umpire  on  the  cutting-room  commission,  and 
perform  such  other  duties  as  may  be  required  of  him  by  the  agree- 
ment or  by  the  Board  of  Arbitration. 

The  chairman  shall  hold  office  during  the  term  of  the  agreement, 
and  in  case  of  death,  resignation,  or  inability  to  act,  the  vacancy 
shall  be  filled  by  the  Board  of  Arbitration. 

It  is  especially  agreed  that  James  Mullenbach,  chairman  under 
the  former  agreement,  shall  be  retained  under  the  present  agreement. 


Ill 


538       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Meetings  of  the  Board  shall  be  held  whenever  necessary  at  such 
times  as  the  chairman  shall  direct.  Whenever  an  authorized  repre- 
sentative of  both  parties  is  present,  it  shall  be  considered  a  quorum. 
Each  party  is  privileged  to  substitute  an  alternate  in  place  of  the 
regular  member  whenever  they  so  desire.  Should  either  side,  after 
reasonable  notice,  fail  to  send  a  representative  to  sit  on  the  Trade 
Board,  then  the  chairman  may  proceed  the  same  as  if  both  parties 
were  present. 

Members  of  the  Board  shall  be  certified  in  writing  to  the  chair- 
man by  the  Joint  Board  of  Hart  Schaffner  &  Marx,  and  the  proper 
official  of  the  company ;  and  any  member,  other  than  the  chairman, 
may  be  removed  and  replaced  by  the  power  appointing  him. 

Deputies 

The  deputies  are  the  officers  having  direct  charge  of  the  execu- 
tion of  the  provisions  of  this  agreement  in  the  interest  of  their  re- 
spective principals.  Each  of  the  parties  hereto  shall  have  a  sufficient 
number  of  deputies  to  properly  take  care  of  the  work  necessary  to  be 
done  to  keep  the  docket  from  being  clogged  with  complaints  and 
to  insure  an  efficient  working  of  the  agreement.  They  shall  have 
power  to  investigate,  mediate,  and  adjust  complaints,  and  settlements 
made  by  the  deputies  of  the  parties  in  dispute  shall  be  legally  bind- 
ing on  their  principals.  In  case  of  appeal  to  the  Trade  Board  or  Board 
of  Arbitration  the  deputies  may  represent  their  respective  principals 
before  these  Boards,  and  shall  have  power  to  summon  and  examine 
witnesses,  to  present  testimony  or  evidence,  and  do  such  other  things 
as  may  be  necessary  to  place  their  case  properly  before  the  trial  body, 
and  such  body  shall  see  to  it  that  they  be  given  adequate  opportunity 
and  facility  for  such  presentation,  subject  to  the  usual  rules  of 
procedure. 

One  of  the  deputies  on  each  side  shall  be  known  as  the  chief 
deputy,  and  the  statement  of  the  chief  deputy  shall  be  regarded  as 
an  authoritative  presentation  of  the  position  of  his  principal  in  any 
matter  in  controversy.  Unless  reversed  or  modified  by  either  of  the 
trial  boards  the  agreement  of  the  chief  deputies  in  all  matters  over 
which  they  or  their  principals  have  authority  shall  be  observed  by 
all  parties. 


HART  SCHAFFNER  &  MARX  AGREEMENT         539 

The  union  deputy  shall  have  access  to  any  shop  or  factory  for  the 
purpose  of  making  investigations  of  complaints ;  but  he  shall  in  all 
cases  be  accompanied  by  the  representative  of  the  employer.  Pro- 
vided, that  the  latter  may  at  his  option  waive  his  right  to  accompany 
him  ;  also  that  in  minor  matters,  where  convenience  or  expedition  may 
be  served,  the  union  deputy  may  call  out  the  shop  chairman  to  obtain 
information  without  such  waiver. 

The  deputies  shall  be  available  to  give  their  duties  prompt  and 
adequate  attention,  and  shall  be  subject  to  the  direction  of  the  Trade 
Board  in  all  matters  relating  to  the  administration  of  this  agreement. 

Qualifications  of  Deputies 

Each  deputy,  in  order  to  qualify  for  duty,  must  have  a  commis- 
sion signed  by  the  proper  official  representing  the  union  or  the 
company,  and  said  commission  must  be  countersigned  by  the  chair- 
man of  the  Trade  Board.  Deputies  must  be  either  em.ployees  of  Hart 
Schaffner  &  Marx  or  persons  who  are  connected  with  the  Joint  Board 
of  Hart  Schaffner  &  Marx. 

Shop  Representative 

The  union  shall  have  in  each  shop  a  duly  accredited  representa- 
tive authorized  by  the  Joint  Board  who  shall  be  recognized  as  the 
officer  of  the  union  having  charge  of  complaints  and  organization 
matters  within  the  shop.  He  shall  be  empowered  to  receive  com- 
plaints and  be  given  sufficient  opportunity  and  range  of  action  to 
enable  him  to  make  proper  inquiry  concerning  them.  When  nec- 
essary for  the  shop  representative  to  leave  his  place  to  investigate 
complaints,  the  foreman  may,  if  he  deems  it  necessary,  ask  to  be 
informed  of  the  purpose  of  his  movements,  and  the  representative 
shall  comply  wnth  his  request. 

It  is  understood  that  the  shop  representative  shall  be  entitled  to 
collect  dues  and  perform  such  other  duties  as  may  be  imposed  on  him 
by  the  union,  provided  they  be  performed  in  such  manner  as  not  to 
interfere  with  shop  discipline  and  efficiency. 

It  is  expected  that  he  shall  represent  the  cooperative  spirit  of 
the  agreement  in  the  shop  and  shall  be  the  leader  in  promoting  that 
amity  and  spirit  of  good  will  which  it  is  the  purpose  of  this  instrument 
to  establish. 


540       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

The  cooperative  spirit  enjoined  on  the  shop  representative  in  the 
foregoing  paragraph  shall  be  expected  in  equal  degree  from  the  shop 
superintendent,  who  shall  be  expected  to  contribute  his  best  efforts 
to  promote  harmony  and  good  will  in  the  shops. 


SECTION  11.   PROCEDURE 
When  Grievances  arise 

When  a  grievance  arises  on  the  floor  of  the  shop,  the  complainant 
shall  report  it  with  reasonable  promptness  to  the  shop  representative, 
who  shall  present  it  without  undue  delay  to  the  shop  superintendent. 
These  two  may  discuss  the  complaint  in  a  judicial  temper,  and  may 
endeavor  to  agree  to  an  adjustment.  It  is  understood,  however,  that 
they  are  not  a  trial  board,  and  it  is  not  expected  that  they  shall  argue 
or  dispute  over  the  case.  In  the  event  that  the  shop  representative 
is  not  satisfied  with  the  action  of  the  superintendent,  he  may 
promptly  report  the  matter  to  his  deputy,  with  such  information  as 
will  enable  him  to  deal  advisedly  with  the  case. 

Failure  to  comply  with  these  provisions  for  the  regulation  of  shop 
transactions  shall  subject  the  offender  to  discipline  by  the  Trade 
Board. 

Informal  oral  adjustments  made  by  shop  officials  are  subject  to 
revision  by  the  Trade  Board,  and  are  not  binding  on  their  principals 
unless  ratified  by  the  chief  deputies. 

Adjustment  by  Deputies 

When  the  shop  officers  report  a  disputed  complaint  to  their  respec- 
tive deputies,  they  shall  give  it  such  investigation  as  its  nature  or 
importance  demands,  either  by  visitation  to  the  shop  or  by  the 
taking  of  testimony,  and  shall  make  an  earnest  endeavor  to  reach  a 
settlement  that  will  be  just  and  satisfactory  to  all  the  parties 
in  dispute. 

Disagreement  by  Deputies 

In  the  event  of  a  failure  to  agree  on  an  adjustment,  the  deputies 
shall  certify  the  case  for  trial  to  the  Trade  Board,  agreeing  on  a 
written  statement  of  facts  if  possible.  In  certifying  such  disagreement 


fi 


HART  SCHAFFNER  &  MARX  AGREEMENT         541 

the  deputy  appealing  to  the  Board  shall  file  a  statement  stating 
specifically  the  nature  of  the  complaint  alleged  with  the  Trade  Board, 
and  shall  furnish  a  copy  to  the  representative  of  the  dissenting  party, 
who  shall  have  at  least  twenty-four  hours  to  prepare  his  answer  unless 
otherwise  agreed  on ;  provided,  that  by  direction  of  the  chairman  of 
the  Trade  Board  emergency  cases  may  be  brought  to  trial  at  once. 
Where  no  statement  has  been  filed  in  writing  within  a  reasonable 
time  after  disagreement  of  the  deputies  it  may  be  assumed  that  the 
disagreement  no  longer  exists,  and  the  case  may  be  considered 
settled. 

Docket  and  Records 

The  chairman  of  the  Trade  Board  shall  keep  a  docket  in  which 
all  cases  shall  be  entered  in  the  order  of  their  arising.  Unless  other- 
wise directed  by  the  chairman,  cases  shall  be  heard  in  the  order  of 
their  filing.  Duplicate  records  shall  be  made  by  the  Board,  one  copy 
of  which  shall  be  retained  by  the  chairman  and  one  given  to  the 
chief  deputy  for  the  union.  Such  records  shall  contain  all  complaints 
filed  with  the  Board,  orders  or  decisions  of  the  Board  or  of  the 
deputies  or  of  any  committee,  calendars  of  pending  cases,  and  such 
other  matter  as  the  Trade  Board  may  order  placed  upon  the  records. 

Direct  Complaints 

Complaints  may  be  made  directly  by  either  party,  without  the 
intervention  of  a  shop  representative,  whenever  it  desires  to  avail 
itself  of  the  protection  of  the  agreement ;  but  a  statement  of  the 
facts  and  grounds  of  such  complaints  must  be  filed  in  writing  as 
hereinbefore  provided.  Unless  written  notice  has  been  filed,  it  may 
be  presumed,  officially,  that  no  complaint  exists. 


Decisions,  Appeals,  etc. 

All  decisions  of  the  Trade  Board  shall  be  in  writing,  and  copies 
given  to  the  representatives  of  each  party.  Should  either  party 
desire  to  appeal  from  the  decision,  it  shall  file  with  the  Board  a 
notice  of  its  intention  so  to  do  within  ten  days  of  the  date  of  the 
decision.  Or  if  either  party  desires  an  amendment  or  modification  of 
the  decision,  or  a  stay  of  execution  pending  the  appeal,  it  m.ay  make 


Ill 


542       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

a  motion  in  writing  to  that  effect,  and  the  chairman  shall  use  his 
discretion  in  granting  it.  In  certifying  the  case  to  the  Board  of 
Arbitration  the  chairman  shall  make  a  summary  of  the  case  in 
writing,  giving  the  main  facts  and  the  grounds  for  his  decision. 

Number  of  Higher  Trial  Board 

On  being  notified  of  the  appeal  to  the  Board  of  Arbitration,  said 
appeal  may  be  heard  by  the  chairman,  as  representative  of  the 
Board,  if  both  parties  agree  to  it  and  it  is  acceptable  to  him.  He 
shall,  however,  have  the  right  to  call  for  the  full  Board  if  in  his 
judgment  the  situation  requires  it.  In  the  event  that  the  representa- 
tive of  the  Board  of  either  party  is  unable  to  attend  a  Board  meeting, 
such  party  may  at  its  discretion  furnish  a  substitute. 

Hearing,  how  Conducted 

The  chairman  shall  determine  the  time  and  place  of  meeting  and 
shall  notify  all  the  parties  in  interest.  Each  party  shall  prepare  the 
case  in  advance,  and  have  its  testimony,  evidence,  and  facts  in  readi- 
ness for  the  hearing.  The  Board  shall  give  each  party  ample  op- 
portunity to  present  its  case,  but  shall  be  the  judge  of  procedure  and 
shall  direct  the  hearing  as  to  its  order  and  course.  After  giving  an 
adequate  hearing  of  the  evidence  and  arguments  the  Board  shall 
render  its  decision  in  writing,  and  shall  furnish  copies  to  the  chief 
deputies  of  each  party  and  to  the  chairman  of  the  Trade  Board.  In 
the  event  that  the  Board  is  unable  to  reach  a  unanimous  decision, 
the  decision  of  a  majority  shall  be  binding. 


i'*i 


Motions  for  Rehearing 

The  Board  may  after  a  reasonable  time  grant  a  rehearing  of  any 
decision,  if,  in  its  judgment,  there  appear  sufficient  reasons  for  doing 
so.  Decisions  are  to  be  regarded  as  the  Board's  best  solution  of  the 
problem  offered  to  it  at  the  time  of  hearing,  but  as  the  problem 
changes  with  time  and  experience  it  is  proper  that  there  should  be 
afforded  a  reasonable  opportunity  for  rehearing  and  review.  Motions 
for  a  rehearing  shall  be  made  in  writing,  and  shall  set  forth  the  reason 
for  the  request. 


HART  SCHAFFNER  &  MARX  AGREEMENT        543 


Enforcement  of  Decisions 

All  decisions,  whether  of  deputies,  Trade  Board,  or  Board  of 
Arbitration,  shall  be  put  into  execution  within  a  reasonable  time, 
and  failure  to  do  so,  unless  for  explainable  cause,  shall  convict  the 
delinquent  party  of  disloyalty  to  the  agreement.  The  party  in  error 
shall  be  notified  of  the  charge,  and  suitable  discipline  imposed.  The 
chief  deputy  of  each  party  shall  be  held  responsible  in  the  first  in- 
stance for  enforcement  of  decisions  or  adjustments  herein  referred 
to,  and  shall  be  held  answerable,  primarily,  to  the  trial  board. 


SECTION  III.    RATES  AND  HOURS 

Schedules  of  Piecework  Rates 

The  prices  and  rates  of  pay  that  are  to  be  in  force  during  the 
life  of  this  agreement  are  set  forth  in  the  schedules  prepared  for  that 
purpose,  duly  authenticated  by  the  proper  signatures,  which  are 
made  a  part  hereof. 

Hours  of  Work 

The  hours  of  work  in  the  tailor  shops  shall  be  forty-nine  per  week, 
with  the  Saturday  half  holiday. 


Minimum  Wage 
The  minimum-wage  scale  in  the  tailor  shop  shall  be  as  follows 


Machine  operators  (male  and  female) 
Women  in  handwork  sections  .  .  . 
Men,  18  years  and  over,  not  operators 
All  men  not  included  in  above  .  .  . 
Inspector  tailors  (men) 


1ST 

Month 

$5.00 
5.00 
8.00 
8.00 

16.00 


2D 

Month 

$7.00 

6.00 

10.00 

9.00 


3D 
Month 

$9.00 

8.00 

12.00 

10.00 


Overtime 

For  work  done  in  excess  of  the  regular  hours  per  day,  overtime 
shall  be  paid  to  pieceworkers  of  50  per  cent  in  addition  to  their 
piecework  rates ;  to  the  week-workers  at  the  rate  of  time  and  a  half ; 


i 


I 


111 


ill 


!  \) 


544       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

no  \vork  shall  be  allowed  on  Sundays  or  legal  holidays.  Christmas, 
New  Year's,  Decoration  Day,  Fourth  of  July,  Labor  Day,  and 
Thanksgiving  Day  shall  be  observed  as  holidays. 


Week-Workers'  Scale 

It  is  agreed  that  the  question  of  classified  wage  scale  and  periodical 
increase  of  pay  for  service  shall  remain  in  the  hands  of  Messrs.  Mul- 
lenbach,  Campbell,  and  Marimpietri,  to  whom  it  was  referred  by 
the  Conference  Committee,  until  they  are  ready  to  report. 

The  week-work  schedule  as  agreed  on  by  the  Committee,  which 
has  been  accepted  and  signed  by  both  the  parties  hereto,  is  hereby 
made  a  part  of  this  agreement,  subject  to  any  changes  that  may  be 
made  as  provided  for  above. 

Piece-Rate  Committee 

Whenever  a  change  of  piece  rate  is  contemplated  the  matter  shall 
be  referred  to  a  specially  appointed  Rate  Committee,  who  shall  fix 
the  rate  according  to  the  change  of  work.  If  the  committee  dis- 
agree, the  Trade  Board  shall  fix  the  rate.  In  fixing  the  rates  the 
Board  is  restricted  to  the  following  rule : 

Changed  rates  must  correspond  to  the  changed  work,  and  new 
rates  must  be  based  upon  old  rates  where  possible. 

Hour  Rates  for  Pieceworkers 

In  case  workers  are  changed  from  piece  to  hour  work,  the  hour 
rates  for  such  pieceworkers  shall  be  based  on  their  earnings  on 
piecework. 

Changing  Operations 

In  the  event  a  pieceworker  is  required  to  change  his  mode  of 
operation  so  that  it  causes  him  to  lose  time  in  learning,  his  case  may 
be  brought  to  the  Rate  Committee  for  its  disposition. 


HART  SCHAFFNER  &  MARX  AGREEMENT         545 

SECTION  IV.   PREFERENCE 
The  Preferential  Shop 

It  is  agreed  that  the  principle  of  the  preferential  shop  shall  prevail, 
to  be  applied  in  the  following  manner : 

Preference  shall  be  applied  in  hiring  and  discharge.  Whenever 
the  employer  needs  additional  workers,  he  shall  first  make  application 
to  the  union,  specifying  the  number  and  kind  of  workers  needed 
The  union  shall  be  given  a  reasonable  time  to  supply  the  specified 
help  and  if  it  is  unable  or  for  any  reason  fails  to  furnish  the  required 
people,  the  employer  shall  be  at  liberty  to  secure  them  in  the  open 
market  as  best  he  can. 

In  like  manner,  the  principle  of  preference  shall  be  applied  m  case 
of  discharge.  Should  it  at  any  time  become  necessary  to  reduce  the 
force  in  conformity  with  the  provisions  of  this  agreement,  the  first 
ones  to  be  dismissed  shall  be  those  who  are  not  members  of  the 
union  in  good  and  regular  standing. 

Discipline  of  Union  Members 
The  Trade  Board  and  Board  of  Arbitration  are  authorized  to  hear 
complaints  from  the  union  concerning  the  discipline  of  its  members 
and  to  take  any  action  necessary  to  conserve  the  interests  of  the 
agreement.  The  members  referred  to  herein  are  those  who  have 
joined,  or  who  may  hereafter  join,  the  Amalgamated  Clothing 
Workers  of  America. 

Preference  in  Transfers 

If  it  becomes  necessary  to  transfer  workers  from  one  shop  to  an- 
other, the  nonunion  workers  shall  be  the  first  to  be  transferred,  unless, 
at  request  of  the  foreman,  union  workers  are  willing  to  go. 

Or  if  it  becomes  necessary  in  the  judgment  of  the  company  to 
transfer  a  worker  from  a  lower  to  a  higher  paid  section  or  operation, 
it  is  agreed  that  union  workers  shall  have  preference  in  such  transfers. 
Provided,  that  nothing  herein  shall  be  construed  to  be  in  conflict 
with  the  provision  relating  to  transfer  for  discipline,  and  provided, 
that  they  are  qualified  to  perform  the  work  required  and  that  their 
departure  from  their  section  does  not  work  to  the  disadvantage  of 
that  section. 


I'ji'l 


•I 


If, 


546       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Overcrowding  of  Sections 

Overcrowding  of  sections  is  important  in  this  agreement  as  the 
point  at  which  the  provision  for  preference  becomes  operative.  It 
is  agreed  that  when  there  are  too  many  workers  in  a  section  to  per- 
mit of  reasonably  steady  employment,  a  complaint  may  be  lodged 
by  the  union,  and  if  proved,  the  nonunion  members  of  the  section, 
or  as  many  of  them  as  may  be  required  to  give  the  needed  relief, 
shall  be  dismissed.  For  the  purpose  of  judging  the  application  of 
preference  the  Trade  Board  shall  take  into  consideration  the  actual 
employment  condition  in  the  section,  as  to  whether  there  are  more 
people  employed  at  the  time  of  complaint  than  are  needed  to  do  the 
work,  and  whether  they,  or  any  of  them,  can  be  spared  without  sub- 
stantial injury  to  the  company.  If  it  is  found  that  the  section  can  be 
reduced  without  substantial  injury,  the  Trade  Board  shall  enforce 
the  principle  of  preference  as  contemplated  in  the  agreement. 

Avoidance  of  Injury 

Among  the  things  to  be  considered  in  the  enforcement  of  pref- 
erence are  the  need  of  maintaining  an  adequate  balance  of  sections, 
or  the  requirements  of  the  busy  season,  the  difficulty  of  hiring 
substitutes,  and  the  risk  of  impairing  the  efficiency  of  the  organiza- 
tion. The  claims  for  enforcement  of  preference  and  for  avoidance  of 
injury  to  the  manufacturing  organization  are  to  be  weighed  by  the 
Trade  Board,  and  the  interests  of  both  claims  safeguarded  as  far  as 
possible,  the  intention  being  to  enforce  preference  so  far  as  it  can 
be  done  without  inflicting  substantial  injury  on  the  company. 

Preference  of  Seniority 

If  in  order  to  properly  balance  sections  a  reduction  of  force  be 
required  greater  than  can  be  secured  by  the  laying  off  of  a  nonunion 
worker  as  provided  for  herein,  then  there  may  be  laid  off  those  who 
are  members  of  the  union  in  the  order  of  their  seniority  who  have 
been  in  the  employ  of  the  company  for  a  period  of  six  months  or  less, 
provided  that  any  exceptionally  efficient  worker,  or  any  especially 
valuable  member  of  the  union,  may  be  exempted  from  the  rule  of 
seniority.  Provided,  also,  the  company  shall  give  notice  to  the  chief 
deputy  of  its  intention  to  discharge  under  this  clause,  and  if  he  fails 
to  agree  the  matter  shall  be  referred  to  the  Trade  Board. 


I 


HART  SCHAFFNER  &  MARX  AGREEMENT         547 

SECTION  V.   WORKING  CONDITIONS 
Discipline 

The  full  power  of  discharge  and  discipline  remains  with  the  com- 
pany and  its  agents ;  but  it  is  understood  that  this  power  should 
be  exercised  with  justice  and  with  due  regard  for  the  reasonable  rights 
of  the  employee,  and  if  an  employee  feels  that  he  has  been  unjustly 
discharged,  he  may  have  appeal  to  the  Trade  Board,  which  shall 
have  the  power  to  review  the  case. 

Every  person  suspended  shall  receive  a  written  notice  directing 
him  to  appear  at  the  office  of  the  company  for  a  decision.  Every 
suspension  notice  properly  presented  to  the  discipline  officer  of 
the  company  must  be  disposed  of  within  six  working  hours  from 
the  time  of  its  presentation,  and  a  definite  decision  announced 
to  the  suspended  person. 

Stoppages 

In  case  of  a  stoppage  of  work  in  any  shop  or  shops,  a  deputy  from 
each  side  shall  immediately  repair  to  the  shop  or  shops  in  question. 

If  such  stoppage  shall  occur  because  the  person  in  charge  of  the 
shop  shall  have  refused  to  allow  the  people  to  continue  work,  he  shall 
be  ordered  to  immediately  give  work  to  the  people,  or  in  case  the  em- 
ployees have  stopped  work,  the  deputies  shall  order  the  people  to 
immediately  return  to  work,  and  in  case  they  fail  to  return  to  work 
within  an  hour  from  such  time,  such  people  shall  be  considered  as 
having  left  the  employ  of  the  corporation  and  shall  not  be  entitled 
to  the  benefit  of  these  rules. 


Detention  in  Shop 

Workers  shall  not  be  detained  in  the  shops  when  there  is  in- 
sufficient work  for  them.  The  company  or  its  agent  shall  exercise  due 
foresight  in  calculating  the  work  available,  and  as  far  as  practicable 
shall  call  only  enough  workers  into  the  factory  to  do  the  work  at 
sight.  And  if  a  greater  number  report  for  work  than  there  is  work 
for,  those  in  excess  of  the  number  required  shall  be  promptly  notified 
and  permitted  to  leave  the  shop.  The  work  on  hand  shall  be  divided 
as  equally  as  may  be  between  the  remaining  workers. 


i-  '. 


548       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Complaint  Sups 
Before  or  at  the  time  of  entering  any  complaint  against  any  em- 
ployee in  the  complaint  book  said  employee  shall  be  notified  thereof 
so  he  may  have  the  opportunity  of  notifying  a  deputy  of  the  Board 
and  have  said  complaint  investigated. 

Lay-offs 
Workers  who  are  dismissed  may  be  given  lay-off  memoranda 
allowing  them  to  return  to  their  shops  or  factories,  trimming  or 
cutting  rooms,  when  there  is  need  for  their  services.  Provided,  this 
clause  shall  not  be  construed  to  give  such  worker  precedence  over 
union  members,  or  to  interfere  in  any  way  with  the  provision  for 
preference  in  hiring. 

Transfer  of  Employees 

The  company  has  the  right  to  transfer  employees  for  purposes  of 
administration  or  discipline,  subject  to  review  by  the  Trade  Board. 
If  the  Board  finds  that  any  transfer  is  being  made  to  lower  wages, 
or  for  any  discrimination  or  improper  purpose,  or  if  injustice  is  being 
done  the  worker  by  the  transfer,  the  Board  may  adjust  the  complaint. 


SECTION   VI.    GENERAL   PROVISIONS 

Lay-off  of  Workers 

No  union  member  who  is  a  permanent  worker  shall  be  laid  off  in 
the  tailor  shops  except  for  cause,  whether  in  the  slack  or  busy  season, 
except  as  provided  herein.  Cause  for  temporary  lay-off  may  be  al- 
ternation of  working  periods  in  slack  times,  reorganization  or  reduc- 
tion of  sections,  lawful  discipline,  and  such  other  causes  as  may  be 
provided  for  herein  or  directed  by  the  Trade  Board. 

Cooperation  to  Abolish  Waiting 
The  company  and  the  deputies  have  agreed  to  cooperate  to  abolish 
all  unnecessary  waiting  in  the  shops. 

DmsioN  OF  Work 
During  the  slack  season  the  work  shall  be  divided  as  nearly  as  is 
practicable  among  all  hands. 


HART  SCHAFFNER  &  MARX  AGREEMENT         549 

Abandonment  of  Position 

Whenever  any  employee  shall  have  absented  himself  from  his 
accustomed  place  without  giving  an  acceptable  reason  to  the  foreman 
or  other  officers  in  charge  of  his  work  before  the  end  of  the  second 
business  day  of  his  absence,  the  employer  may  consider  his  position 
forfeited.  Notice  of  absence  and  reason  therefor  must  be  given  to 
foreman  by  messenger,  mail,  or  telephone. 


Abolishment  of  Section 

WTien  sections  are  abolished,  the  company  and  its  agents  shall 
use  every  effort  to  give  the  displaced  workers  employment  as  much 
as  possible  like  the  work  from  which  they  were  displaced,  within  a 
reasonable  time. 

Sickness 

Any  workers  who  are  absent  on  account  of  sickness  shall  be  re- 
instated in  their  former  positions  if  they  return  within  a  reasonable 
time. 

Trade-Board  Members 

Complaints  against  members  of  the  Trade  Board  as  workmen 
are  to  be  made  by  the  foremen  to  the  Trade  Board.  Any  action 
of  any  employee  as  a  member  of  the  Trade  Board  shall  not  be  con- 
sidered inimical  to  his  employment  with  the  corporation.  No  member 
of  a  Trade  Board  shall  sit  on  a  case  in  which  he  is  interested,  or  to 
which  he  is  a  party. 

Union  Membership 

The  provisions  for  preference  made  herein  require  that  the  door 
of  the  union  be  kept  open  for  the  reception  of  nonunion  workers. 
Initiation  fee  and  dues  must  be  maintained  at  a  reasonable  rate,  and 
any  applicant  must  be  admitted  who  is  not  an  offender  against  the 
union  and  who  is  eligible  for  membership  under  its  rules.  Provided, 
that  if  any  rules  be  passed  that  impose  an  unreasonable  hardship, 
or  that  operate  to  bar  desirable  persons,  the  matter  may  be  brought 
before  the  Trade  Board  or  Board  of  Arbitration  for  such  remedy  as 
it  may  deem  advisable. 


iiiHi 


550       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  Old  Agreement 

The  provisions  of  the  old  agreement  and  the  decisions  based  thereon 
shall  be  regarded  as  being  in  force  except  as  they  may  be  modified 
by,  or  are  not  in  conflict  with,  the  provisions  of  the  present  agreement. 


SECTION   VII.   LOYALTY  TO   THE   AGREEMENT 

Experience  suggests  that  there  are  certain  points  of  strain  which 
it  would  be  wise  to  recognize  in  advance  and  to  safeguard  as  far  as 
possible.    Among  the  points  to  be  safeguarded  are  the  following : 

1.  When  dissatisfaction  arises  over  change  of  price  or  working 
conditions,  it  is  believed  that  the  agreement  provides  a  remedy  for 
every  such  grievance  that  can  arise,  and  all  complainants  are  urged 
and  expected  to  present  their  cases  to  the  proper  officials  and  await 
an  adjustment.  If  anyone  refuses  to  do  this,  and  instead  takes  the 
law  in  his  own  hands  by  inciting  a  stoppage  or  otherwise  foments 
dissatisfaction  or  rebellion,  he  shall,  if  convicted,  be  adjudged  guilty 
of  disloyalty  to  the  agreement  and  be  subject  to  discipline  by  the 
Trade  Board. 

2.  Strain  may  arise  because  of  unsatisfactory  personal  relations 
between  workers  and  officials.  The  company's  officials  are  subject 
to  the  law  as  are  the  workers,  and  equally  responsible  for  loyalty  in 
word  and  deed,  and  are  subject  to  discipline  if  found  guilty  of  vio- 
lation. Any  complaints  against  them  must  be  made  and  adjudicated 
in  the  regular  manner.  They  are  to  respect  the  workers  and  be 
respected  by  them  in  their  positions  and  supported  in  the  proper 
discharge  of  their  duties.  Anyone  indulging  in  improper  language 
or  conduct  calculated  to  injure  them  or  to  break  down  their  authority 
in  the  shop  shall  be  adjudged  guilty  of  disloyalty  and  disciplined 
accordingly. 

3.  Officials  of  the  union  are  equally  under  the  protection  of  the 
agreement  when  in  the  exercise  of  their  duties  as  are  the  officials  of 
the  company,  and  any  words  or  acts  tending  to  discredit  them  or  the 
union  which  they  represent,  or  which  are  calculated  to  injure  the 
influence  or  standing  of  the  union  or  its  representatives,  shall  be 
considered  as  disloyalty  to  the  agreement,  and  the  offender  shall  be 
subject  to  discipline  by  the  Trade  Board,  provided,  however,  that 


HART  SCHAFFNER  &  MARX  AGREEMENT         551 

no  reasonable  criticism  or  expression  of  disagreement  expressed  in 
proper  language  shall  be  deemed  a  violation  within  the  meaning  of 
this  section. 

4.  If  any  worker  shall  willfully  violate  the  spirit  of  the  agreement 
by  intentional  opposition  to  its  fundamental  purposes,  and  especially 
if  he  carry  such  willful  violation  into  action  by  striking  and  inciting 
others  to  strike  or  stop  work  during  working  hours,  he  shall,  if  charge 
is  proven,  be  subject  to  suspension,  discharge,  or  fine.  Provided, 
that  if  a  fine  is  imposed,  its  amount  shall  be  determined  by  the 
chairman  of  the  Trade  Board  and  shall  not  be  less  than  $1  or  more 
than  $5  for  each  offense. 

5.  If  any  foreman,  superintendent,  or  agent  of  the  company  shall 
willfully  violate  the  spirit  of  this  agreement,  and  especially  if  he  fails 
to  observe  and  carry  out  any  decision  of  the  Trade  Board  or  Board 
of  Arbitration,  he  shall,  if  charge  is  proven,  be  subject  to  a  fine  of 
not  less  than  Sio  or  more  than  Si 00  for  each  offense,  at  the  discretion 
of  the  chairman  of  the  Trade  Board. 


SECTION  VIII.    CUTTING  AND  TRIMMING  DEPARTMENTS 

The  cutting  and  trimming  departments  shall  be  subject  to  the 
general  provisions  of  this  agreement,  and  to  the  bases  and  provisions 
of  the  old  agreement  except  as  they  may  be  modified  by,  or  found  to 
be  in  conflict  with,  the  special  provisions  agreed  on  for  these  depart- 
ments. It  is  understood  that  these  special  provisions  are  intended  to 
change  certain  features  of  the  old  agreement,  and  if  they  are  found 
to  be  in  conflict,  the  new  provisions  are  to  be  considered  as  the  guide 
of  practice  and  as  representing  the  latest  and,  therefore,  the  most 
authoritative  expression  of  the  wills  of  the  parties  hereto.  The  new 
special  provisions  are  as  follows : 

1.  The  principle  of  preference  as  applied  in  the  cutting  and  trim- 
ming rooms  shall  be  as  before,  except  that  the  clause  relating  to 
cutters  who  are  exempted  from  union  obligations  is  expressly  defined 
as  being  strictly  limited  to  the  individuals  now  on  the  exemption  list. 
Should  the  number  on  that  list  be  for  any  reason  reduced,  it  is 
understood  that  no  other  cutters  and  trimmers  can  be  added. 

2.  The  company  shall  not  reduce  the  wages  of  any  cutter.  The 
company  shall  report  to  the  commission  all  failures  of  cutters  to 


I 


t 


% 

•J. 


552       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

produce  their  quota  of  work  when  in  its  judgment  the  delinquency  is 
not  caused  by  the  conditions  of  the  work.  The  commission  shall 
investigate  the  matter  and  advise  with  the  cutter  concerning  it. 
At  the  end  of  a  period  sufficiently  long  to  determine  the  merits  of 
the  case,  the  cutters'  commission  shall,  if  it  deem  necessary,  find 
measures  to  discipline  cutters  to  conform  to  their  production.  In 
judging  the  merits  in  such  instances  the  commission  shall  use  the 
principle  of  comparative  efficiency. 

3.  All  cutters  whose  present  wages  are  less  than  S26  per  week  shall 
receive  an  increase  of  Si  per  week.  This  increase  shall  not  be  taken 
into  account  by  the  commission  in  calculating  the  quota  of  work 

required  by  such  cutter. 

4.  The  company  shall  prefer  men  now  in  the  trimming  room 
when  increasing  the  number  of  apprentice  cutters. 

5.  The  salaries  of  experienced  cutters  who  are  employed  tempo- 
rarily shall  for  the  first  two  weeks  be  at  a  rate  not  less  than  the 
salaries  they  received  in  their  last  position.  After  two  weeks  the  tem- 
porary cutters  shall  be  paid  on  the  same  basis  as  the  regular  men, 
their  salary  to  be  fixed  by  the  cutters'  commission  on  the  basis  of 
their  production  and  their  comparative  efficiency. 

6.  The  company  shall  continue  the  practice  of  paying  cutters  for 
Christmas,  New  Year's,  Decoration  Day,  Fourth  of  July,  Labor  Day, 
and  Thanksgiving  Day. 

Paper-Cutting  Department 

All  men  who  cut  paper  patterns  shall  be  members  of  the  union ; 
except  that,  by  special  agreement,  one  man,  Mr.  Lindsay,  may  be 
exempted  from  such  requirement,  and  shall  be  added  to  the  existing 

exempted  group. 

The  three  apprentices  now  in  the  paper-cutting  department  shall 
have  the  status,  privileges,  and  protection  of  the  regular  cutting- 
room  apprentices,  including  the  right  to  learn  all  branches  of  the 
trade,  and  be  subject  to  the  same  requirements  and  provisions.  The 
ratio  of  apprentices  to  cutters  in  the  paper-cutting  department  shall 
not  exceed  that  which  obtains  now;  namely,  three  apprentices  to 
seven  permanent  cutters. 

The  company  may  employ  such  other  boy  help  in  this  depart- 
ment as  is  needed,  and  such  boys  may,  at  its  option,  be  promoted  to 


HAJIT  SCHAFFNER  &  MARX  AGREEMENT        553 

positions  as  apprentices  when  vacancies  arise,  but  not  in  excess  of 
the  total  number  of  apprentices  provided  for  in  the  agreement. 

Permanent  graders  employed  in  the  grading  department  may 
work  at  paper  cutting  temporarily  when  there  is  not  sufficient  work 
in  their  own  department.  Boys  who  are  not  apprentices  shall,  not 
take  the  places  of  blockers  in  any  permanent  manner,  but  they  may 
for  short  times,  to  fill  odd  unemployed  hours,  be  permitted  to  try  to 
do  blocking  in  the  slack  seasons. 


Damage  Department 

All  employees  in  the  damage  department  who  recut  parts  of  gar- 
ments shall  be  members  of  the  union  or  exempted  men.  The  man- 
ager of  the  department  and  helpers  who  do  not  cut  parts  shall  not 
be  members  of  the  union. 


Trimming  Department 

1.  All  men  now  on  the  trimmers'  pay  roll  who  are  receiving  not 
to  exceed  Si 5  are  to  be  increased  S2  per  week.  All  men  receiving 
a  weekly  wage  of  over  $15  and  not  exceeding  S20  shall  receive  an 
increase  of  Si  per  week;  except"  that  apprentice  trimmers  having 
been  employed  less  than  six  months  are  to  receive  an  increase  of 
$1  per  week. 

2.  The  following  periodical  increases  shall  be  granted  during  the 
term  of  this  agreement:  Men  receiving  under  Si 2  shall  receive  an 
increase  of  Si  per  week  every  three  months  until  their  wages  shall  be 
Si 2  per  week.  Men  receiving  over  $12  and  less  than  Si 8  shall  receive 
an  increase  of  Si  every  six  months  until  their  wages  shall  be  Si 8  per 
week.  Men  receiving  over  S18  per  week  and  less  than  S20  shall  re- 
ceive an  increase  of  Si  per  week  every  year  until  their  wages  shall  be 
S20  per  week. 

3.  All  men  starting  to  work  on  the  band-saw  machines  shall  re- 
ceive not  less  than  Si 8  per  week  and  shall  receive  an  increase  of 
Si  per  week  every  six  months  until  their  wages  are  S20.  There- 
after they  shall  receive  an  increase  of  Si  per  week  every  year  until 
they  reach  the  rate  of  S24.  No  man  shall  be  assigned  to  the 
band-saw  machine  permanently  until  he  has  been  employed  in  the 
trimming  room  two  years. 


II 


'  si. 


554       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

4.  So  far  as  practicable,  the  apprentices  in  the  trimming  room 
shall  begin  on  their  work  on  the  lower  grades  of  the  trade  and  shall 
be  advanced  gradually  to  the  more  difficult  ones. 

5.  Apprentices  shall  not  be  permanently  transferred  to  work 
requiring  the  use  of  any  electric  machines  until  they  have  been 
employed  for  one  year  or  more. 

6.  The  wages  of  experienced  men  employed  shall  be  determined 
in  the  same  manner  as  in  the  cutting  room. 

7.  The  jack  boys  and  canvas  pickers  are  to  be  under  the  juris- 
diction of  the  union,  with  this  express  provision:  That  these  two 
sections  are  not  to  be  under  the  agreed  scale  for  trimmers,  but  are 
to  be  subject  to  a  special  scale  of  wages,  which  scale  is  to  be  subject 
to  the  decision  of  the  Board  of  Arbitration. 

THE  EXPERIENCE  OF  HART  SCHAFFNER  &  MARX  WITH 

COLLECTIVE  BARGAINING  ^ 

During  the  past  four  years  this  company  has  concerned  itself 
very  deeply  in  developing  its  relations  with  its  employees.  Labor 
disturbances  brought  keenly  to  our  attention  the  necessity  of  having 
the  good  will  of  the  workers  in  order  that  we  might  maintain  and 
preserve  the  good  will  of  our  customers  and  insure  the  stability  of 

our  business. 

We  are  glad  to  give  an  outline  of  our  experience,  believing  it  has 
yielded  results  in  the  form  of  certain  principles  of  policy  and  action 
which  may  be  helpful  in  the  promotion  of  industrial  peace. 

In  making  this  statement  we  are  particularly  concerned  that  the 
formal  and  external  features  of  our  plan  shall  not  be  confused  with 
the  real  and  vital  substance  of  the  arrangements,  to  the  neglect  of 
the  spirit  and  of  the  principles  which  are  in  reality  responsible  for 
whatever  progress  we  have  made. 

After  an  opportunity  of  several  years  to  study  causes  and  effects 
we  are  convinced  that  the  prime  source  of  difficulty  was  a  lack  of 
contact  and  understanding  between  our  people  and  ourselves.  The 
failure  to  adjust  petty  grievances  and  abuses  became  the  cause  of 
irritation  entirely  disproportionate  to  their  importance  when  taken 

1  Prepared  for  the  Federal  Industrial  Relations  Commission  as  a  part  of  testi- 
mony for  the  hearing  at  Washington,  April,  1914. 


HART  SCHAFFNER  &  MARX  AGREEMENT         555 

singly,  but  which  in  accumulation  became  the  main  ground  for 
complaint. 

There  was  no  special  complaint  against  the  hours  of  work,  which 
were  fifty-four  per  week,  and  which  have  since  been  reduced  to 
fifty-two.  The  physical  working  conditions  were  good  and  in  fact 
very  far  advanced  compared  with  the  general  conditions  in  the 
industry.  There  was  a  general  demand  for  higher  wages,  but  we 
have  always  looked  upon  this  as  an  accompanying  demand  rather 
than  a  first  cause  of  difficulty. 

A  settlement  was  reached  by  an  agreement  to  arbitrate,  one 
arbitrator  to  be  named  by  each  side  and  the  two  to  choose  a  third. 
It  was  not  possible  to  agree  upon  the  third  member  and  the  efforts 
to  arbitrate  were  started  with  only  the  two  partisan  men  on  the 
board.  This  proved  to  be  a  good  thing.  For  the  time  being  it  forced 
us  to  settle  matters  by  agreement  and  compromise  rather  than  by 
arbitrary  decision,  and  this  method  has  become  a  distinctive  feature 
of  the  whole  system.  A  third  arbitrator  was  eventually  chosen,  and 
he  is  a  man  peculiarly  capable  of  aiding  in  creating  sympathetic 
understanding  on  the  part  of  all. 

Favorable  results  did  not  appear  at  once,  but  were  the  natural 
and  legitimate  effects  of  various  devices  introduced  to  meet  diffi- 
cult situations  as  they  arose,  and  of  certain  principles  of  fair  dealing, 
into  harmony  with  which  we  have  attempted  to  bring  our  business 

policies. 

In  addition,  the  company  created  a  labor  department.  A  univer- 
sity professor,  trained  in  economics,  was  engaged  to  study  the 
situation  and  draft  a  plan  for  promoting  better  relations  with  our 
employees.  At  the  beginning  the  task  appeared  stupendous,  as 
grievances  were  highly  magnified  and  exaggerated  by  frequent  re- 
iteration of  the  more  radical  leaders  for  the  purpose  of  keeping  the 
war  spirit  at  a  high  temperature. 

This  new  department,  headed  by  Professor  Earl  Dean  Howard  of 
Northwestern  University,  gradually  assumed  certain  functions  in 
which  the  workers  had  a  direct  interest  and  administered  them  with 
the  main  purpose  always  in  view.  The  chief  duties  of  the  labor 
department  now  are :  the  maintenance  of  a  system  for  the  prompt 
discovery  and  investigation  of  any  abuses  or  complaints  existing 
anywhere  among  the  employees;  the  recommendation  of  measures 


^ 


1. 

f 


n 


li 


J*' 

i 


556       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

designed  to  eliminate  the  source  of  the  complaint ;  protecting  the 
company's  interests  in  the  Board  of  Arbitration  and  the  Trade 
Board   (a  court  of  first  instance  established  to  adjust  complamts 
and  interpret  the  agreements) ;  negotiating  with  the  business  agents 
of  the  unions  and  satisfying  their  demands  as  far  as  possible ;  ad- 
ministering all  discipline  for  all  the  factories  (all  executives  have 
been  relieved  of  this  function);  general  oversight  of  all  hiring;  the 
maintenance  of  hospital  and  rest  rooms;   the  administration  of  a 
charity  fund  for  unfortunate  employees,  of  a  loan  fund,  and  of  the 
Workman's  Compensation  Act ;  responsibility  for  the  observance  of 
the  state  and  municipal  laws  regarding  child  labor,  health  and  safety, 
also  for  the  strict  observance  of  all  agreements  with  the  unions  or  de- 
cisions of  the  two  Boards ;  education  of  the  foremen  and  people  in 
courtesy,  patience,  mutual  helpfulness,  and  other  peace-producing 
qualities ;  suggesting  devices  for  the  amelioration  of  hardships  inci- 
dental to  the  industry  and  for  the  higher  efficiency  of  operating. 

Industrial  peace  will  never  come  so  long  as  either  employer  or 
employee  believes  that  he  is  deprived  of  rights  honestly  belong- 
ing to  him.  Our  experience  has  taught  that  the  business  man  in 
authority  is  a  trustee  of  various  interests,  including  his  own,  and  if 
he  administers  his  business  so  as  to  conserve  and  harmonize  these 
interests  to  the  best  of  his  ability,  he  is  most  likely  building  an 

enduring  success. 

A  labor  department  critical  of  everything  touching  the  interests  of 
the  workers,  a  Trade  Board  and  a  Board  of  Arbitration  constantly 
reviewing  and  discussing  policies  and  methods,  protect  us  against 
ourselves  and  make  it  impossible  to  violate  or  overlook  the  rights 
of  the  employees.  These  agencies  undoubtedly  create  limitations 
which  at  times  seem  vexatious,  but  we  have  found  that  in  the  long 
run  legitimate  progress  has  been  helped  rather  than  hindered  thereby. 
Innumerable  cases  have  arisen  where  we  have  been  obliged  to 
change  plans  and  policies  much  against  our  will,  yet  where  the  final 
results  were  better  because  of  the  change. 

Arbitration  and  conciliation  should  be  applied  to  all  departments 
of  a  business  wherever  there  is  a  conflict  of  interest.  If  nothing 
more,  it  insures  exhaustive  discussion  of  every  matter  of  importance, 
gives  everybody  an  opportunity  to  express  his  opinions,  frequently 
brings  to  light  valuable  suggestions,  and  makes  possible  a  higher 


HART  SCHAFFNER  &  MARX  AGREEMENT         557 

degree  of  cooperation  and  teamwork.  It  is  a  method  to  be  em- 
ployed continuously  to  secure  harmony  and  satisfaction.  Patience 
and  self-control  are  essential  in  administering  a  business  on  this 
basis.  It  is  human  nature  to  resent  interference  and  to  desire  un- 
restricted liberty  of  action,  but  these  conditions  are  not  necessary 
and  are  often  inimical  to  true  success.  Few  men  can  use  unlimited 
power  wisely,  and  no  wise  man  will  dispense  with  checks  which  tend 
to  keep  him  in  the  right  path ;  certainly  he  will  approve  of  checks 
calculated  to  restrain  his  agents  from  arbitrary  and  unjust  acts 
toward  fellow  employees. 

The  appHcation  of  these  ideas  to  the  labor  problem,  especially 
as  a  help  to  the  employer  in  deciding  what  attitude  to  take  toward 
trade-unionism,  has  produced  favorable  results  with  us.  If  the  em- 
ployer voluntarily  limits  his  own  authority  and  agrees  to  conduct 
his  business  according  to  the  rule  of  reason  and  even-handed  justice 
as  interpreted  by  an  outside  authority,  such  as  an  arbitration  board, 
he  must  insist  that  the  organized  employees  submit  to  the  same 
limitation,  otherwise  his  sacrifice  will  be  futile  and  his  submission 
to  injustice  cowardly. 

Unions  should  be  recognized  and  favored  in  the  same  propor- 
tion as  they  manifest  a  genuine  desire  to  govern  themselves  effi- 
ciently. All  agreements  should  be  so  drawn  as  to  release  the  employer 
from  his  obligations  whenever  the  unions  fail  to  observe  theirs. 
Arbitration  boards,  officials  in  charge  of  labor  matters,  and  union 
leaders  should  direct  their  operations  and  make  their  decisions  with 
the  one  purpose  always  in  mind ;  namely,  to  make  it  profitable  and 
easy  for  all  parties  to  acquiesce  in  the  rule  of  reason  and  justice, 
and  dangerous  and  difficult  for  them  to  attempt  to  get  unjust 
advantage.  We  did  not  realize,  and  we  believe  the  majority  of 
employers  do  not  yet  realize,  the  extent  to  which  the  attitude  and 
conduct  of  their  organized  employees  reflect  their  owm  policies  and 
conduct.  Strict  adherence  to  justice,  especially  if  interpreted  to  the 
people  by  a  board  in  whom  they  have  confidence,  will  gradually 
educate  them  and  their  leaders  to  see  the  advantage  of  this  method. 
It  is  fortunate  for  the  employer  if  his  own  employees  have  an  auton- 
omous organization,  influenced  as  little  as  possible  by  outsiders. 

In  our  own  business,  employing  thousands  of  persons, — some  of 
them  newly  arrived  immigrants,  some  of  them  in  opposition  to  the 


i    .il 


liiffi^ 


558       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

wage  system,  hostile  to  employers  as  a  class, — we  have  observed 
astonishing  changes  in  their  attitude  during  three  years  under  the 
influence  of  our  labor  arrangements.  They  seem  to  understand  that 
they  can  rely  upon  promises  made  to  them  by  the  company ;  that  all 
disputes  will  be  finally  adjusted  according  to  just  principles  inter- 
preted by  wise  arbitrators. 

Disciplinary  methods  are  a  prolific  source  of  dispute  with  em- 
ployees, and  it  is  difficult  to  avoid  offending  their  sense  of  justice, 
especially  if  they  are  not  fully  informed  of  all  the  facts  in  the  case 
and  hear  only  one  side.  Moreover,  petty  officials  are  not  likely  to 
show  good  judgment  in  administering  disciplinary  power  or  to  have 
correct  theories  about  it ;  very  frequently  they  are  tempted  to  satisfy 
private  dislikes  under  pretense  of  disciplining.  We  regard  it  as  an 
essential  element  in  maintaining  industrial  peace  to  centralize  the 
administration  of  discipline  in  one  official  having  no  interest  except 
to  maintain  the  efficiency  of  the  shops  without  disturbing  the  harmony 
and  good  will  of  the  people. 

Our  theory  of  discipline  is  that  it  should  be  as  mild  as  possible 
consistent  with  effectiveness  in  securing  the  desired  results.  Com- 
plaint memoranda  are  given  as  warnings  by  the  foreman ;  if  these 
are  disregarded,  suspension  slips  are  next  given,  which  remove  the 
offenders  from  the  pay  roll  until  reinstated  by  the  discipline  officer. 
An  investigation  is  made,  and,  as  a  rule,  the  suspended  person  is 
restored  to  his  position  on  probation.  This  method  is  continued  until 
it  becomes  apparent  that  the  employee  is  either  hopelessly  incom- 
petent or  insubordinate,  whereupon  a  temporary  lay-off  or  discharge 
may  follow.  Our  Trade  Board,  composed  of  workmen  and  foremen, 
presided  over  by  a  neutral,  outside  chairman,  will  give  a  hearing 
to  the  case  if  requested,  and  may  order  a  reinstatement  or  modi- 
fication of  the  penalty.  Appeal  from  this  tribunal  may  be  taken  to 
the  Board  of  Arbitration  for  final  adjudication.  In  spite  of  its 
apparent  complexity  the  administration  of  discipline  has  become  very 
satisfactory  to  both  sides,  and  very  few  cases  even  come  before  the 
Trade  Board  and  for  many  months  none  have  been  appealed. 

Much  depends  upon  the  leaders  of  the  workers.  We  have  had 
some  experience  with  misinformed  and  self-seeking  men  who  secured 
temporary  influence  over  the  people,  but  somehow  they  failed  to 
thrive  in  the  atmosphere  of  our  arrangement.    Some  of  these  same 


HART  SCHAFFNER  &  MARX  AGREEMENT         559 

men  have  been  delivered  of  their  worst  qualities  as  they  have  learned 
the  advantage  of  better  methods  of  dealing.  The  system  seems  to 
work  out  a  selection  of  the  fittest  candidates  and  trains  them  to  be- 
come efficient  leaders  and  executives,  skilled  in  negotiation,  in  plead- 
ing and  cross-examination  before  the  judicial  boards,  in  organizing, 
disciplining,  and  leading  the  people.  One  of  the  leaders  in  particular 
developed  a  wonderful  influence  over  all  who  came  in  contact  with 
him  on  account  of  his  high  ideals,  his  patience  under  trying  cir- 
cumstances, and  his  indomitable  faith  in  the  ultimate  success  of 
right  method. 

At  the  beginning  of  our  experiment  we  believed  that  the  labor 
union  was  a  competitor  for  the  good  will  of  the  people  and  that  both 
could  not  have  this  good  will  at  the  same  time ;  we  feared  that  the 
union  would  get  the  credit  for  anything  granted  to  the  people,  thus 
nullifying  the  good  effect  to  the  company  of  any  concessions  or 
benefits  given  to  them.  Concessions  wrung  from  the  reluctant 
employer  by  the  union  through  a  Board  of  Arbitration,  especially 
if  the  withholding  of  the  concession  seems  contrary  to  the  sense 
of  justice  of  the  workers,  of  course  gain  no  good  will  for  the 
company. 

Without  some  kind  of  organization  among  the  people  there  are 
no  responsible  and  authorized  representatives  with  whom  to  deal, 
and  the  real  interests  of  the  people  as  they  see  them  themselves  are 
likely  to  be  overlooked  or  disregarded.  The  chosen  representatives 
are  made  to  feel  the  dignity  and  honor  of  their  positions  so  long  as 
they  deal  fairiy  and  reasonably ;  those  who  adopt  a  different  policy 
invariably  fail  and  retire  with  considerable  loss  of  respect  and 
prestige.  Those  whose  motives  are  good  and  who  can  reason  intel- 
ligently grow  in  the  esteem  of  their  fellows  through  their  success  in 
negotiation  and  arbitration.  They  appreciate  the  consideration  shown 
them  by  the  company  and  the  arbitrators  and  reciprocate  by  pro- 
claiming the  fairness  of  the  company. 

One  of  the  most  important  functions  of  our  labor  department  is 
welfare  work, — giving  advice  and  material  assistance  to  unfortunate 
employees,  improving  the  working  conditions  in  the  shops,  maintain- 
ing rest  rooms  and  libraries,  etc., — but  this  is  not  done  for  the  purpose 
of  more  easily  depriving  the  workers  of  their  right  to  be  represented 
in  all  matters  in  which  their  interests  are  involved.    Workingmen 


*  1 


56o      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

are  quick  to  resent  the  substitution  of  favors  for  justice.  Welfare 
work,  however,  in  connection  with  general  fair  dealing,  is  very- 
effective  in  securing  good  will,  especially  if  it  increases  the 
personal  contact  between  the  officials  of  the  company  and  the 
employees. 

Not  the  least  of  the  advantages  we  have  derived  from  our  system 
is  the  reaction  of  the  ideas  and  ideals,  first  applied  in  the  labor 
department,  upon  the  other  departments,  and  particularly  upon  the 
executive  staff  of  the  manufacturing  department.  Inefficient  methods 
of  foremen,  lack  of  watchful  supervision,  and  inaccurate  information 
as  to  prevailing  conditions  on  the  part  of  higher  executives, — these 
could  not  long  survive  when  every  complaint  brought  by  a  work- 
man was  thoroughly  investigated  and  the  root  cause  of  the  trouble 
brought  to  light. 

The  unexpected  and  indirect  results  of  our  labor  policy  in  increas- 
ing the  efficiency,  reforming  the  conduct,  and  raising  the  intelli- 
gence of  the  executives  coming  into  contact  with  the  system  have 
been  as  profitable  and  satisfactory  as  the  direct  result,  i.e.  the  crea- 
tion of  harmony  and  good  will  on  the  part  of  the  people  toward 
the  company. 

A  summary  of  the  essentials  of  the  system  which  has  produced 
such  gratifying  results  in  our  institution  would  include:  a  labor 
department,  responsible  for  industrial  peace  and  good  will  of  the 
employees,  thereby  of  necessity  fully  informed  as  to  their  sentiments, 
their  organizations,  and  really  representing  their  interests  in  the 
councils  of  the  company ;  a  means  for  the  prompt  and  final  settle- 
ment of  all  disputes ;  a  conviction  in  the  minds  of  the  employees  that 
the  employer  is  fair  and  that  all  their  interests  are  safeguarded ; 
constant  instruction  of  the  leaders  and  people  in  the  principles  of 
business  equity,  thus  gradually  evolving  a  code  accepted  by  all  parties 
in  interest,  serviceable  as  a  basis  for  adjustment  of  all  difficulties; 
the  development  of  efficient  representation  of  the  employees — honest, 
painstaking,  dignified,  reasonable,  eager  to  cooperate  in  maintaining 
peace,  influential  with  their  people,  and  truly  representative  of  their 
real  interests ;  a  friendly  policy  toward  the  union  so  long  as  it  is  con- 
ducted in  harmony  with  the  ethical  principles  employed  in  the  busi- 
ness and  an  uncompromising  opposition  to  all  attempts  to  coerce  or 
impose  upon  the  rights  of  any  group  or  to  gain  an  unfair  advantage ; 


k\ 


HART  SCHAFFNER  &  MARX  AGREEMENT 


S6i 


and  a  management  that  guarantees  every  man  full  compensation 
for  his  efficiency  and  prevents  anyone's  receiving  anything  he  has 
not  earned. 

Briefly  expressed,  it  is  simply  the  natural  and  healthy  relation 
which  usually  exists  between  the  small  employer  and  his  half-dozen 
workmen,  artificially  restored,  as  far  as  possible  in  a  large-scale 
business  where  the  real  employer  is  a  considerable  group  of  execu- 
tives managing  thousands  of  workers  according  to  certain  established 
principles  and  policies. 

Hart  Schaffner  &  Marx 


XXXVI 

AMERICAN  FEDERATION  OF  LABOR  RECONSTRUC- 
TION PROGRAM^ 

THE  World  War  has  forced  all  free  peoples  to  a  fuller  and 
deeper  realization  of  the  menace  to  civilization  contained  in 
autocratic  control  of  the  activities  and  destinies  of  mankind. 

It  has  caused  a  world-wide  determination  to  overthrow  and  eradi- 
cate all  autocratic  institutions,  so  that  a  full  measure  of  freedom  and 
justice  can  be  established  between  man  and  man  and  nation  and 

nation. 

It  has  awakened  more  fully  the  consciousness  that  the  principles 
of  democracy  should  regulate  the  relationship  of  men  in  all  their 

activities. 

It  has  opened   the  doors  of   opportunity   through   which  more 

sound  and  progressive  policies  may  enter. 

New  conceptions  of  human  liberty,  justice,  and  opportunity  are 

to  be  applied. 

The  American  Federation  of  Labor,  the  one  organization  repre- 
senting labor  in  America,  conscious  that  its  responsibilities  are  now 
greater  than  before,  presents  a  program  for  the  guidance  of  labor, 
based  upon  experience  and  formulated  with  a  full  consciousness  of 
the  principles  and  policies  which  have  successfully  guided  Ameri- 
can trade-unionism  in  the  past. 

DEMOCRACY  IN  INDUSTRY 

Two  codes  of  rules  and  regulations  affect  the  workers:  the  law 
upon  the  statute  books  and  the  rules  within  industry. 

The  first  determines  their  relationship  as  citizens  to  all  other 
citizens  and  to  property. 

1  This  program  was  drafted  by  the  Committee  on  Reconstruction  appointed 
by  instruction  of  the  Convention  of  the  American  Federation  of  Labor,  held  at 
St.  Paul,  Minnesota,  June  10-20,  1Q18.  The  program  was  unanimously  in- 
dorsed by  the  Executive  Council  of  the  American  Federation  of  Labor. 

562 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM     563 

The  second  largely  determines  the  relationship  of  employer  and 
employee,  the  terms  of  employment,  the  conditions  of  labor,  and 
the  rules  and  regulations  affecting  the  workers  as  employees.  The 
first  is  secured  through  the  application  of  the  methods  of  democracy 
in  the  enactment  of  legislation,  and  is  based  upon  the  principle  that 
the  laws  which  govern  a  free  people  should  exist  only  with  their 
consent. 

The  second,  except  where  effective  trade-unionism  exists,  is  estab- 
lished by  the  arbitrary  or  autocratic  whim,  desire,  or  opinion  of 
the  employer,  and  is  based  upon  the  principle  that  industry  and 
commerce  cannot  be  successfully  conducted  unless  the  employer 
exercises  the  unquestioned  right  to  establish  such  rules,  regulations, 
and  provisions  affecting  the  employees  as  self-interest  prompts. 

Both  forms  of  law  vitally  affect  the  workers'  opportunities  in 
life  and  determine  their  standard  of  living.  The  rules,  regulations, 
and  conditions  within  industry  in  many  instances  affect  them  more 
than  legislative  enactments.  It  is,  therefore,  essential  that  the 
workers  should  have  a  voice  in  determining  the  laws  within  industry 
and  commerce  which  affect  them  equivalent  to  the  voice  which  they 
have  as  citizens  in  determining  the  legislative  enactments  which 
shall  govern  them. 

It  is  as  inconceivable  that  the  workers  as  free  citizens  should 
remain  under  autocratically  made  law  within  industry  and  commerce 
as  it  is  that  the  nation  could  remain  a  democracy  while  certain 
individuals  or  groups  exercise  autocratic  powers. 

It  is,  therefore,  essential  that  the  workers  everywhere  should 
insist  upon  their  right  to  organize  into  trade-unions,  and  that 
effective  legislation  should  be  enacted  which  would  make  it  a  criminal 
offense  for  any  employer  to  interfere  with  or  hamper  the  exercise  of 
this  right  or  to  interfere  with  the  legitimate  activities  of  trade-unions. 

UNEMPLOYMENT 

Political  economy  of  the  old  school,  conceived  by  doctrinaires, 
was  based  upon  unsound  and  false  doctrines,  and  has  since  been 
used  to  blindfold,  deceive,  and  defeat  the  workers'  demands  for 
adequate  wages,  better  living  and  working  conditions,  and  a  just  share 
of  the  fruits  of  their  labor. 


ill' 


! 


564       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

We  hold  strictly  to  the  trade-union  philosophy  and  its  developed 
political  economy  based  upon  demonstrated  facts. 

Unemployment  is  due  to  underconsumption.  Underconsumption 
is  caused  by  low  or  insufficient  wages. 

Just  wages  will  prevent  industrial  stagnation  and  lessen  periodical 
unemployment. 

Give  the  workers  just  wages  and  their  consuming  capacity  is 
correspondingly  increased.  A  man's  ability  to  consume  is  controlled 
by  the  wages  received.  Just  wages  will  create  a  market  at  home 
which  will  far  surpass  any  market  that  may  exist  elsewhere  and 
will  lessen  unemployment. 

The  employment  of  idle  workmen  on  public  work  will  not  per- 
manently remove  the  cause  of  unemployment.   It  is  an  expedient 

at  best. 

There  is  no  basis  in  fact  for  the  claim  that  the  so-called  law  of 
supply  and  demand  is  natural  in  its  operations  and  impossible  of 
control  or  regulation. 

The  trade-union  movement  has  maintained  standards,  wages, 
hours,  and  life  in  periods  of  industrial  depression  and  idleness.  These 
in  themselves  are  a  refutation  of  the  declared  immutability  of  the 
law  of  supply  and  demand. 

There  is,  in  fact,  no  such  condition  as  an  iron  law  of  wages  based 
upon  a  natural  law  of  supply  and  demand.  Conditions  in  commerce 
and  industry,  methods  of  production,  storing  of  commodities,  regu- 
lation of  the  volume  of  production,  banking  systems,  the  flow  and 
direction  of  enterprise  influenced  by  combinations  and  trusts,  have 
effectively  destroyed  the  theory  of  a  natural  law  of  supply  and 
demand  as  had  been  formulated  by  doctrinaire  economists. 

WAGES 

There  are  no  means  whereby  the  workers  can  obtain  and  main- 
tain fair  wages  except  through  trade-union  effort.  Therefore  eco- 
nomic organization  is  paramount  to  all  their  other  activities. 

Organization  of  the  workers  leads  to  better  wages,  fewer  working 
hours,  improved  working  conditions ;  it  develops  independence,  man- 
hood, and  character ;  it  fosters  tolerance  and  real  justice  and  makes 
for  a  constantly  growing  better  economic,  social,  and  political  life 
for  the  burden-bearing  masses. 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM      565 

In  countries  where  wages  are  best  the  greatest  progress  has  been 
made  in  economic,  social,  and  political  advancement,  in  science,  art, 
literature,  education,  and  in  the  wealth  of  the  people  generally. 
All  low-wage-paying  countries  contrasted  with  America  is  proof 
for  this  statement. 

The  American  standard  of  life  must  be  maintained  and  improved. 
The  value  of  wages  is  determined  by  the  purchasing  power  of  the 
dollar.  There  is  no  such  thing  as  good  wages  when  the  cost  of  living 
in  decency  and  comfort  equals  or  exceeds  the  wages  received.  There 
must  be  no  reduction  in  wages ;  in  many  instances  wages  must  be 
increased. 

The  workers  of  the  nation  demand  a  living  wage  for  all  wage- 
earners,  skilled  or  unskilled — a  wage  which  will  enable  the  worker 
and  his  family  to  live  in  health  and  comfort,  provide  a  competence 
for  illness  and  old  age,  and  afford  to  all  the  opportunity  of  culti- 
vating the  best  that  is  within  mankind. 

HOURS  OF  LABOR 

Reasonable  hours  of  labor  promote  the  economic  and  social  well- 
being  of  the  toiling  masses.  Their  attainment  should  be  one  of 
labor's  principal  and  essential  activities.  The  shorter  workday  and  a 
shorter  work-week  make  for  a  constantly  growing,  higher,  and  better 
standard  of  productivity,  health,  longevity,  morals,  and  citizenship. 

The  right  of  labor  to  fix  its  hours  of  work  must  not  be  abrogated, 
abridged,  or  interfered  with. 

The  day's  working-time  should  be  limited  to  not  more  than  eight 
hours,  with  overtime  prohibited  except  under  the  most  extraordinary 
emergencies.  The  week's  working-time  should  be  limited  to  not 
more  than  five  and  one  half  days. 

WOMEN  AS  WAGE-EARNERS 

Women  should  receive  the  same  pay  as  men  for  equal  work  per- 
formed. Women  workers  must  not  be  permitted  to  perform  tasks 
disproportionate  to  their  physical  strength  or  which  tend  to  impair 
their  potential  motherhood  and  prevent  the  continuation  of  a  na- 
tion of  strong,  healthy,  sturdy,  and  intelligent  men  and  women. 


Vfl 


566       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

CHILD  LABOR 

The  children  constitute  the  nation's  most  valuable  asset.  The  full 
responsibility  of  the  government  should  be  recognized  by  such  meas- 
ures as  will  protect  the  health  of  every  child  at  birth  and  during  its 

immature  years. 

It  must  be  one  of  the  chief  functions  of  the  nation  through  effec- 
tive legislation  to  put  an  immediate  end  to  the  exploitation  of 
children  under  sixteen  years  of  age. 

State  legislatures  should  protect  children  of  immature  years  by 
prohibiting  their  employment,  for  gain,  under  sixteen  years  of  age 
and  restricting  the  employment  of  children  of  less  than  eighteen 
years  of  age  to  not  more  than  twenty  hours  within  any  one  week 
and  with  not  less  than  twenty  hours  at  school  during  the  same  period. 

Exploitation  of  child  life  for  private  gain  must  not  be  permitted. 


I 


•;i 


STATUS  OF  PUBLIC  EMPLOYEES 

The  fixing  of  wages,  hours,  and  conditions  of  labor  for  public 
employees  by  legislation  hampers  the  necessary  exercise  of  organi- 
zation and  collective  bargaining. 

Public  employees  must  not  be  denied  the  right  of  organization,. 
free  activities,  and  collective  bargaining,  and  must  not  be  limited 
in  the  exercise  of  their  rights  as  citizens. 


COOPERATION 

To  attain  the  greatest  possible  development  of  civilization,  it  is 
essential,  among  other  things,  that  the  people  should  never  delegate 
to  others  those  activities  and  responsibilities  which  they  are  capable 
of  assuming  for  themselves.  Democracy  can  function  best  with  the 
least  interference  by  the  state  compatible  with  due  protection  to  the 

rights  of  all  citizens. 

There  are  many  problems  arising  from  production,  transportation, 
and  distribution  which  would  be  readily  solved  by  applying  the 
methods  of  cooperation.  Unnecessary  middlemen,  who  exact  a  tax 
from  the  community  without  rendering  any  useful  service,  can  be 
eliminated. 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM     567 

The  farmers,  through  cooperative  dairies,  canneries,  packing 
houses,  grain  elevators,  distributing  houses,  and  other  cooperative 
enterprises,  can  secure  higher  prices  for  their  products  and  yet  place 
these  in  the  consumer's  hands  at  lower  prices  than  would  otherwise 
be  paid.  There  is  an  almost  limitless  field  for  the  consumers  in 
which  to  establish  cooperative  buying  and  selling,  and  in  this  most 
necessary  development  the  trade-unionists  should  take  an  immediate 
and  active  part. 

Trade-unions  secure  fair  wages.  Cooperation  protects  the  wage- 
earner  from  the  profiteer. 

Participation  in  these  cooperative  agencies  must  of  necessity  pre- 
pare the  mass  of  the  people  to  participate  more  effectively  in  the 
solution  of  the  industrial,  commercial,  social,  and  political  problems 
which  continually  arise. 


THE  PEOPLE'S  FINAL  VOICE  IN  LEGISLATION 

It  is  manifestly  evident  that  a  people  are  not  self-governing  unless 
they  enjoy  the  unquestioned  power  to  determine  the  form  and  sub- 
stance of  the  laws  which  shall  govern  them.  Self-government  can- 
not adequately  function  if  there  exists  within  the  nation  a  superior 
power  or  authority  which  can  finally  determine  what  legislation, 
enacted  by  the  people  or  their  duly  elected  representatives,  shall  be 
placed  upon  the  statute  books  and  what  shall  be  declared  null 
and  void. 

An  insuperable  obstacle  to  self-government  in  the  United  States 
exists  in  the  power  which  has  been  gradually  assumed  by  the  supreme 
courts  of  the  federal  and  state  governments  to  declare  legislation 
null  and  void  upon  the  ground  that,  in  the  court's  opinion,  it  is 
unconstitutional.' 

It  is  essential  that  the  people,  acting  directly  or  through  Congress 
or  state  legislatures,  should  have  final  authority  in  determining 
which  laws  shall  be  enacted.  Adequate  steps  must  be  taken,  there- 
fore, which  will  provide  that  in  the  event  of  a  supreme  court 
declaring  an  act  of  Congress  or  of  a  state  legislature  unconstitutional, 
and  the  people,  acting  directly  or  through  Congress  or  a  state  legisla- 
ture, reenacting  the  measure,  it  shall  then  become  the  law  with- 
out being  subject  to  annulment  by  any  court. 


11 


if 


568       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

POLITICAL  POLICY 

In  the  political  efforts  arising  from  the  workers'  necessity  to  se- 
cure legislation  covering  those  conditions  and  provisions  of  life  not 
subject  to  collective  bargaining  with  employers,  organized  labor  has 
followed  two  methods :  one  by  organizing  political  parties,  the  other 
by  the  determination  to  place  in  public  office  representatives  from 
their  ranks — to  elect  those  who  favor  and  champion  the  legislation 
desired  and  to  defeat  those  whose  policy  is  opposed  to  labor's  legis- 
lative demands,  regardless  of  partisan  politics. 

The  disastrous  experience  of  organized  labor  in  America  with 
political  parties  of  its  own  amply  justified  the  American  Federation 
of  Labor's  nonpartisan  political  policy.  The  results  secured  by  labor 
parties  in  other  countries  never  have  been  such  as  to  warrant  any 
deviation  from  this  position.  The  rules  and  regulations  of  trade- 
unionism  should  not  be  extended  so  that  the  action  of  a  majority 
could  force  a  minority  to  vote  for  or  give  financial  support  to  any 
political  candidate  or  party  to  whom  they  are  opposed.  Trade- 
union  activities  cannot  receive  the  undivided  attention  of  mem- 
bers and  officers  if  the  exigencies,  burdens,  and  responsibilities  of  a 
political  party  are  bound  up  with  their  economic  and  industrial 
organizations. 

The  experiences  and  results  attained  through  the  nonpartisan 
political  policy  of  the  American  Federation  of  Labor  cover  a  gen- 
eration. They  indicate  that  through  its  application  the  workers  of 
America  have  secured  a  much  larger  measure  of  fundamental  legis- 
lation— establishing  their  rights,  safeguarding  their  interests,  pro- 
tecting their  welfare,  and  opening  the  doors  of  opportunity — than 
have  been  secured  by  the  workers  of  any  other  country. 

The  vital  legislation  now  required  can  be  more  readily  secured 
through  education  of  the  public  mind  and  the  appeal  to  its  con- 
science, supplemented  by  energetic  independent  political  activity  on 
the  part  of  trade-unionists,  than  by  any  other  method.  This  is  and 
will  continue  to  be  the  political  policy  of  the  American  Federation 
of  Labor  if  the  lessons  which  labor  has  learned  in  the  bitter  but 
practical  school  of  experience  are  to  be  respected  and  applied. 

It  is,  therefore,  most  essential  that  the  officers  of  the  American 
Federation  of  Labor,  the  officers  of  the  affiliated  organizations,  state 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM     569 

federations,  and  central  labor  bodies,  and  the  entire  membership  of 
the  trade-union  movement  should  give  the  most  vigorous  application 
possible  to  the  political  policy  of  the  American  Federation  of  Labor 
so  that  labor's  friends  and  opponents  may  be  more  widely  known 
and  the  legislation  most  required  readily  secured.  This  phase  of  our 
movement  is  still  in  its  infancy.  It  should  be  continued  and  developed 
to  its  logical  conclusion. 

GOVERNMENT  OWNERSHIP 

Public  and  semipublic  utilities  should  be  owned,  operated,  or 
regulated  by  the  government  in  the  interest  of  the  public. 

Whatever  final  disposition  shall  be  made  of  the  railways  of  the 
country  in  ownership,  management,  or  regulation,  we  insist  upon  the 
right  of  the  workers  to  organize  for  their  common  and  mutual  pro- 
tection and  the  full  exercise  of  the  normal  activities  which  come  with 
organization.  Any  attempt  at  the  denial  by  governmental  authority 
of  the  rights  of  the  workers  to  organize,  to  petition,  to  representation, 
and  to  collective  bargaining,  or  the  denial  of  the  exercise  of  their 
political  rights,  is  repugnant  to  the  fundamental  principles  of  free 
citizenship  in  a  republic  and  is  destructive  of  their  best  interest 
and  welfare. 

The  government  should  own  and  operate  all  wharves  and  docks 
connected  with  public  harbors  which  are  used  for  commerce  or 
transportation. 

The  American  Merchant  Marine  should  be  encouraged  and  de- 
veloped under  governmental  control,  and  so  manned  as  to  insure 
successful  operation  and  protect  in  full  the  beneficent  laws  now  on 
the  statute  books  for  the  rights  and  welfare  of  seamen.  The  sea- 
men must  be  accorded  the  same  rights  and  privileges  rightfully 
exercised  by  the  workers  in  all  other  employments,  public  and 
private. 

WATERWAYS  AND  WATER  POWER 

The  lack  of  a  practical  development  of  our  waterways  and  the 
inadequate  extension  of  canals  have  seriously  handicapped  water 
traffic  and  created  unnecessarily  high  cost  for  transportation.  In 
many  instances  it  has  established  artificial  restrictions,  which  have 
worked  to  the  serious  injury  of  communities,  owing  to  the  schemes 


570       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  those  controlling  a  monopoly  of  land  transportation.  Our  navi- 
gable rivers  and  our  great  inland  lakes  should  be  connected  with  the 
sea  by  an  adequate  system  of  canals,  so  that  inland  production  can 
be  more  effectively  fostered,  the  costs  of  transportation  reduced,  the 
private  monopoly  of  transportation  overcome,  and  imports  and 
exports  shipped  at  lower  costs. 

The  nation  is  possessed  of  enormous  water  power.  Legislation 
should  be  enacted  providing  that  the  governments,  federal  and  state, 
should  own,  develop,  and  operate  all  water  power  over  which  they 
have  jurisdiction.  The  power  thus  generated  should  be  supplied  to 
all  citizens  at  rates  based  upon  cost.  The  water  power  of  the 
nation,  created  by  nature,  must  not  be  permitted  to  pass  into 
private  hands  for  private  exploitation. 

REGULATION  OF  LAND   OWNERSHIP 

Agriculture  and  stock  raising  are  essential  to  national  safety  and 
well-being.  The  history  of  all  countries,  at  all  times,  indicates  that 
the  conditions  which  create  a  tenant  class  of  agriculturists  work 
increasing  injury  to  the  tillers  of  the  soil.  While  increasing  the  price 
of  the  product  to  the  consumer  these  conditions  at  the  same  time 
develop  a  class  of  large  landowners  who  contribute  little,  if  anything, 
to  the  welfare  of  the  community,  but  who  exact  a  continually  in- 
creasing share  of  the  wealth  produced  by  the  tenant.  The  private 
ownership  of  large  tracts  of  usable  land  is  not  conducive  to  the  best 
interests  of  a  democratic  people. 

Legislation  should  be  enacted  placing  a  graduated  tax  upon  all 
usable  lands  above  the  acreage  which  is  cultivated  by  the  owner. 
This  should  include  provisions  through  which  the  tenant  farmer,  or 
others,  may  purchase  land  upon  the  lowest  rate  of  interest  and 
most  favorable  terms  consistent  with  safety,  and  so  safeguarded  by 
governmental  supervision  and  regulation  as  to  give  the  fullest  and 
freest  opportunity  for  the  development  of  land-owning  agriculturists. 

Special  assistance  should  be  given  in  the  direction  of  allotments  of 
lands  and  the  establishment  of  homes  on  the  public  domain. 

Establishment  of  government  experimental  farms,  measures  for 
stock-raising  instruction,  the  irrigation  of  arid  lands,  and  reclama- 
tion of  swamp  and  cut-over  lands  should  be  undertaken  upon  a 
larger  scale  under  direction  of  the  federal  government. 


AMERICAN  FEDEB^TION  OF  LABOR  PROGRAM     571 

Municipalities  and  states  should  be  empowered  to  acquire  lands 
for  cultivation  or  the  erection  of  residential  buildings  which  they 
may  use  or  dispose  of  under  equitable  terms. 

FEDERAL  AND  STATE  REGULATION  OF  CORPORATIONS 

The  creation  by  legislative  enactment  of  corporations,  without 
sufficient  definition  of  the  powers  and  scope  of  activities  conferred 
upon  them  and  without  provisions  for  their  adequate  supervision, 
regulation,  and  control  by  the  creative  body,  has  led  to  the  develop- 
ment of  far-reaching  abuses  which  have  seriously  affected  commerce, 
industry,  and  the  masses  of  the  people  through  their  influence  upon 
social,  industrial,  commercial,  and  political  development.  Legisla- 
tion is  required  which  will  so  limit,  define,  and  regulate  the  powers, 
privileges,  and  activities  of  corporations  that  their  methods  cannot 
become  detrimental  to  the  welfare  of  the  people.  It  is,  therefore, 
essential  that  legislation  should  provide  for  the  federal  licensing  of 
all .  corporations  organized  for  profit.  Furthermore,  federal  super- 
vision and  control  should  include  the  increasing  of  capital  stock 
and  the  incurring  of  bonded  indebtedness,  with  the  provision  that 
the  books  of  all  corporations  shall  be  open  at  all  times  to  federal 
examiners. 

FREEDOM  OF  EXPRESSION  AND  ASSOCIATION 

The  very  life  and  perpetuity  of  free  and  democratic  institutions 
are  dependent  upon  freedom  of  speech,  of  the  press,  and  of  assem- 
blage and  association.  W^e  insist  that  all  restrictions  of  freedom  of 
speech,  press,  public  assembly,  association,  and  travel  be  completely 
removed,  individuals  and  groups  being  responsible  for  their  utter- 
ances. These  fundamental  rights  must  be  set  out  with  clearness  and 
must  not  be  denied  or  abridged  in  any  manner. 


'W 


WORKMEN'S  COMPENSATION 

Workmen's  compensation  laws  should  be  amended  to  provide 
more  adequately  for  those  incapacitated  by  industrial  accidents  or 
occupational  diseases.  To  assure  that  the  insurance  fund  derived 
from  commerce  and  industry  will  be  paid  in  full  to  injured  workers, 


Ilii 


, 


572       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

state  insurance  must  supplant,  and  prohibit  the  existence  of,  em- 
ployers' liability  insurance  operated  for  profit. 

IMMIGRATION 

Americanization  of  those  coming  from  foreign  lands,  as  well  as 
our  standards  of  education  and  living,  are  vitally  affected  by  the 
volume  and  character  of  the  immigration. 

It  is  essential  that  additional  legislation  regulating  immigration 
should  be  enacted,  based  upon  two  fundamental  propositions :  namely, 
that  the  flow  of  immigration  must  not  at  any  time  exceed  the  nation's 
ability  to  assimilate  and  Americanize  the  foreigners  coming  to  our 
shores,  and  that  at  no  time  shall  immigration  be  permitted  when  there 
exists  an  abnormal  degree  of  unemployment. 

By  reason  of  existing  conditions  we  urge  that  immigration  into 
the  United  States  should  be  prohibited  for  a  period  of  at  least  two 
years  after  peace  has  been  declared. 

TAXATION 

One  of  the  nation's  most  valuable  assets  is  the  initiative,  energetic, 
constructive,  and  inventive  genius  of  its  people.  These  qualities, 
when  properly  applied,  should  be  fostered  and  protected  instead  of 
being  hampered  by  legislation,  for  they  constitute  an  invaluable 
element  of  progress  and  material  development.  Taxation  should, 
therefore,  rest  as  lightly  as  possible  upon  constructive  enterprise. 
Taxation  should  provide  for  full  contribution  from  wealth  by  a  tax 
upon  profits  which  will  not  discourage  industrial  or  commercial 
enterprise.  There  should  be  provided  a  progressive  increase  in  taxes 
upon  incomes,  inheritances,  and  upon  land  values  of  such  a  nature 
as  to  render  it  unprofitable  to  hold  land  without  putting  it  to  use,  to 
afford  a  transition  to  greater  economic  equality,  and  to  supply  means 
of  liquidating  the  national  indebtedness  growing  out  of  the  war. 

EDUCATION 

It  is  impossible  to  estimate  the  influence  of  education  upon  the 
world's  civilization.  Education  must  not  stifle  thought  and  in- 
quiry, but  must  awaken  the  mind  concerning  the  application  of 
natural  laws  and  to  a  conception  of  independence  and  progress. 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM     573 

Education  must  not  be  for  a  few  but  for  all  our  people.  While 
there  is  an  advanced  form  of  public  education  in  many  states,  there 
still  remains  a  lack  of  adequate  educational  facilities  in  several 
states  and  communities.  The  welfare  of  the  republic  demands  that 
public  education  should  be  elevated  to  the  highest  degree  possible. 
The  government  should  exercise  advisory  supervision  over  public 
education,  and  where  necessary  maintain  adequate  public  education 
through  subsidies  without  giving  to  the  government  power  to  hamper 
or  interfere  with  the  free  development  of  public  education  by  the 
several  states.  It  is  essential  that  our  system  of  public  education 
should  offer  the  wage-earners'  children  the  opportunity  for  the 
fullest  possible  development.  To  attain  this  end  state  colleges  and 
universities  should  be  developed. 

It  is  also  important  that  the  industrial  education  which  is  being 
fostered  and  developed  should  have  for  its  purpose  not  so  much 
training  for  efficiency  in  industry  as  training  for  life  in  an  indus- 
trial society.  A  full  understanding  must  be  had  of  those  principles 
and  activities  that  are  the  foundation  of  all  productive  efforts. 
Children  should  not  only  become  familiar  with  tools  and  materials 
but  they  should  also  receive  a  thorough  knowledge  of  the  principles 
of  human  control,  of  force  and  matter  underlying  our  industrial 
relations  and  sciences.  The  danger  that  certain  commercial  and 
industrial  interests  may  dominate  the  character  of  education  must 
be  averted  by  insisting  that  the  workers  shall  have  equal  represen- 
tation on  all  boards  of  education  or  committees  having  control  over 
vocational  studies  and  training. 

To  elevate  and  advance  the  interests  of  the  teaching  profession 
and  to  promote  popular  and  democratic  education,  the  right  of  the 
teachers  to  organize  and  to  affiliate  with  the  movement  of  the 
organized  workers  must  be  recognized. 

PRIVATE  EMPLOYMENT  AGENCIES 

Essentials  in  industry  and  commerce  are  employee  and  employer, 
labor  and  capital.  No  one  questions  the  right  of  organized  capital 
to  supply  capital  to  employers.  No  one  should  question  the  right 
of  organized  labor  to  furnish  workers.  Private  employment  agencies 
abridge  this  right  of  organized  labor. 


■ 


iiii 


r 


t 


<■ 


574       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Where  federal,  state,  and  municipal  employment  agencies  are 
maintained  they  should  operate  under  the  supervision  of  joint  com- 
mittees of  trade-unionists  and  employers,  equally  represented. 

Private  employment  agencies  operated  for  profit  should  not  be 
permitted  to  exist. 

HOUSING 

Child  life,  the  workers'  physical  condition,  and  public  health 
demand  that  the  wage-earner  and  his  family  shall  be  given  a  full 
opportunity  to  live  under  wholesome  conditions.  It  is  not  only 
necessary  that  there  shall  be  sanitary  and  appropriate  houses  to 
live  in  but  that  a  sufficient  number  of  dwellings  shall  be  available 
to  free  the  people  from  high  rents  and  overcrowding. 

The  ownership  of  homes,  free  from  the  grasp  of  exploitive  and 
speculative  interests,  will  make  for  more  efficient  workers,  more 
contented  families,  and  better  citizens.  The  government  should, 
therefore,  inaugurate  a  plan  to  build  model  homes  and  establish  a 
system  of  credits  whereby  the  workers  may  borrow  money  at  a  low 
rate  of  interest  and  under  favorable  terms  to  build  their  own  homes. 
Credit  should  also  be  extended  to  voluntary  non-profit-making  hous- 
ing and  joint-tenancy  associations.  States  and  municipalities  should 
be  freed  from  the  restrictions  preventing  their  undertaking  proper 
housing  projects  and  should  be  permitted  to  engage  in  other  neces- 
sary enterprises  relating  thereto.  The  erection  and  maintenance 
of  dwellings  where  migratory  workers  may  find  lodging  and  nourish- 
ing food  during  periods  of  unemployment  should  be  encouraged  and 
supported  by  municipalities. 

If  need  should  arise  to  expend  public  funds  to  relieve  unemploy- 
ment, the  building  of  wholesome  houses  would  best  serve  the  public 
interests. 

MILITARISM 

The  trade-union  movement  is  unalterably  and  emphatically  op- 
posed to  "militarism"  or  a  large  standing  army.  "Militarism"  is 
a  system  fostered  and  developed  by  tyrants  in  the  hope  of  support- 
ing their  arbitrary  authority.  It  is  utilized  by  those  whose  selfish 
ambitions  for  power  and  worldly  glory  lead  them  to  invade  and 
subdue  other  peoples   and   nations,   to  destroy   their  liberties,   to 


?! 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM     575 

acquire  their  wealth,  and  to  fasten  the  yoke  of  bondage  upon  them. 
The  trade-union  movement  is  convinced  by  the  experience  of  man- 
kind that  "militarism"  brutalizes  those  influenced  by  the  spirit 
of  the  institution.    The  finer  elements  of  humanity  are  strangled. 
Under  "militarism"  a  deceptive  patriotism  is  established  in  the 
peoples'  minds,  where  men  believe  that  there  is  nobility  of  spirit 
and  heroism  in  dying  for  the  glory  of  a  dynasty  or  the  maintenance 
of  institutions  which  are  inimical  to  human  progress  and  democracy. 
"Militarism"  is  the  application  of  arbitrary  and  irresponsible  forces 
as  opposed  to  reason  and  justice.    Resistance  to  injustice  and  tyranny 
is  that  virile  quality  which  has  given  purpose  and  effect  to  en- 
nobling causes  in  all  countries  and  at  all  times.    The  free  institu- 
tions of  our  country  and  the  liberties  won  by  its  founders  would  have 
been  impossible  had  they  been  unwilling  to  take  arms  and  if  neces- 
sary die  in  the  defense  of  their  liberties.    Only  a  people  willing  to 
maintain  their  rights  and  defend  their  liberties  are  guaranteed  free 

institutions. 

Conditions  foreign  to  the  institutions  of  our  country  have  pre- 
vented the  entire  abolition  of  organized  bodies  of  men  trained  to 
carry  arms.   A  voluntary  citizen  soldiery  supplies  what  would  other- 
wise take  its  place,  a  large  standing  army.    To  the  latter  we  are 
unalterably  opposed  as  tending  to  establish  the  evils  of  "milita- 
rism."  Large  standing  armies  threaten  the  existence  of  civil  liberty. 
The  history  of  every  nation  demonstrates  that  as  standing  armies 
are  enlarged  the  rule  of  democracy   is  lessened  or   extinguished. 
Our  experience  has  been  that  even  this  citizen  soldiery,  the  militia 
of  our  states,  has  given  cause  at  times  for  grave  apprehension.    Their 
ranks  have  not  always  been  free  from  undesirable  elements,  particu- 
lariy  the  tools  of  corporations  involved  in  industrial  disputes.    During 
industrial  disputes  the  militia  has  at  times  been  called  upon  to 
support  the  authority  of  those  who  through  selfish  interests  desired 
to  enforce  martial  law,  while  the  courts  were  open  and  the  civil 
authorities  competent  to  maintain  supremacy  of  civil  law.   We  insist 
that  the  militia  of  our  several  states  should  be  wholly  organized  and 
controlled  by  democratic  principles,  so  that  this  voluntary  force  of 
soldiery  may  never  be  diverted  from  its  true  purpose  and  used  to 
jeopardize  or  infringe  upon  the  rights  and  liberties  of  our  people. 
The  right  to  bear  arms  is  a  fundamental  principle  of  our  government, 


I 


iiii 


■■i 


576       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

a  principle  accepted  at  all  times  by  free  people  as  essential  to  the 
maintenance  of  their  liberties  and  institutions.  We  demand  that  this 
right  shall  remain  inviolate. 

SOLDIERS  AND  SAILORS 

Soldiers  and  sailors,  those  who  entered  the  service  in  the  nation's 
defense,  are  entitled  to  the  generous  reward  of  a  grateful  repubUc. 

The  necessities  of  war  called  upon  millions  of  workmen  to  leave 
their  positions  in  industry  and  commerce  to  defend,  upon  the  battle- 
fields, the  nation's  safety  and  its  free  institutions.  These  defenders 
are  now  returning.  It  is  advisable  that  they  should  be  discharged 
from  military  service  at  the  earliest  possible  moment,  that  as  civilians 
they  may  return  to  their  respective  homes  and  families  and  take  up 
their  peace-time  pursuits.  The  nation  stands  morally  obligated  to 
assist  them  in  securing  employment. 

Industry  has  undergone  great  changes  due  to  the  dislocation 
caused  by  war  production  and  transportation.  Further  readjust- 
ments in  industry  and  commerce  must  follow  the  rehabilitation  of 
business  under  peaceful  conditions.  Many  positions  which  our  citi- 
zen soldiers  and  sailors  filled  previous  to  enlistment  do  not  exist 

today. 

It  would  be  manifestly  unjust  for  the  government,  after  having 
removed  the  worker  from  his  position  in  industry  and  placed  him  in 
military  service,  to  discharge  him  from  the  army  or  navy  without 
having  made  adequate  provision  to  assist  him  in  procuring  employ- 
ment and  providing  sustenance  until  employment  has  been  secured. 
The  returned  citizen  soldier  or  sailor  should  not  be  forced  by  the 
bitter  urgent  necessity  of  securing  food  and  clothing  to  place  himself 
at  a  disadvantage  when  seeking  employment. 

Upon  their  discharge,  transportation  and  meals  should  be  supplied 
to  their  places  of  residence.  The  monthly  salary  previously  paid 
should  be  continued  for  a  period  not  to  exceed  twelve  months  if 
employment  is  not  secured  within  that  period. 

The  federal  and  state  employment  bureaus  should  be  directed  to 
cooperate  with  trade-union  agencies  in  securing  employment  for 
discharged  soldiers  and  sailors.  In  assisting  the  discharged  soldier 
and  sailor  to  secure  employment,  government  agencies  should  not 


AMERICAN  FEDERATION  OF  LABOR  PROGRAM     577 

expect  them  to  accept  employment  for  less  than  the  prevailing  rate 
of  wages  being  paid  in  the  industry.  Neither  should  any  govern- 
ment agency  request  or  require  such  discharged  men  to  accept  em- 
ployment where  a  trade  dispute  exists  or  is  threatened.  Nor  should 
the  refusal  on  the  part  of  any  of  these  discharged  soldiers  or  sailors 
to  accept  employment  where  trade  disputes  exist  or  are  threatened, 
or  when  less  than  the  prevailing  wage  rate  is  offered,  deprive  them 
of  a  continuance  of  their  monthly  pay. 

Legislation  also  should  be  enacted  which  will  give  the  nation's 
defenders  the  opportunity  for  easy  and  ready  access  to  the  land. 
Favorable  inducements  should  be  provided  for  them  to  enter  agri- 
culture and  husbandry.  The  government  should  assume  the  re- 
sponsibility for  the  allotment  of  such  lands  and  supply  the  necessary 
capital  for  its  development  and  cultivation,  with  such  safeguards  as 
will  protect  both  the  government  and  the  discharged  soldier  and  sailor. 

CONCLUSION 

No  element  in  our  nation  is  more  vitally  concerned  with  the 
problems  of  making  for  a  permanent  peace  between  all  nations  than 
the  working  people.  The  opportunities  now  before  us  are  without 
precedent.  It  is  of  paramount  importance  that  labor  shall  be  free 
and  unhampered  in  shaping  the  principles  and  agencies  affecting  the 
wage-earners'  condition  of  life  and  work. 

By  the  light  that  has  been  given  to  it  the  American  Federation  of 
Labor  has  attracted  to  its  fold  over  three  millions  of  wage-earners, 
and  its  sphere  of  influence  and  helpfulness  is  growing  by  leaps  and 
bounds.  By  having  followed  safe  and  sound  fundamental  principles 
and  policies,  founded  on  freedom,  justice,  and  democracy,  the  Ameri- 
can trade-union  movement  has  achieved  successes  of  an  inestimable 
value  to  the  masses  of  toilers  of  our  country.  By  adhering  to  these 
principles  and  policies  we  can  meet  all  problems  of  readjustment, 
however  grave  in  importance  and  difficult  of  solution,  with  a  feeling 
of  assurance  that  our  efforts  will  be  rewarded  by  a  still  greater 
success  than  that  achieved  in  the  past. 

Given  the  whole-hearted  support  of  all  men  and  women  of  labor, 
our  organized  labor  movement  with  its  constructive  program,  its  love 
for  freedom,  justice,  and  democracy,  will  prove  the  most  potent 


ii 


T» 


_^      ■  V-  ep 


4 


578       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

factor  in  protecting,  safeguarding,  and  promoting  the  general  wel- 
fare of  the  great  mass  of  our  people  during  this  trying  period  of 
reconstruction  and  all  times  thereafter. 

The  American  Federation  of  Labor  has  attained  its  present  position 
of  dignity  and  splendid  influence  because  of  its  adherence  to  one 
common  cause  and  purpose  ;  that  purpose  is  to  protect  the  rights  and 
interests  of  the  masses  of  the  workers  and  to  secure  for  them  a  better 
and  a  brighter  day.  Let  us  therefore  strive  on  and  on  to  bring  into 
our  organizations  the  yet  unorganized.  Let  us  concentrate  our  efforts 
to  organize  all  the  forces  of  wage-earners.  Let  the  nation  hear  the 
united  demand  from  the  laboring  voice.  Now  is  the  time  for  the 
workers  of  America  to  come  to  the  stand  of  their  unions  and  to  organ- 
ize as  thoroughly  and  completely  and  compactly  as  is  possible.  Let 
each  worker  bear  in  mind  the  words  of  Longfellow : 

In  the  world's  broad  field  of  battle, 

In  the  bivouac  of  Life, 
Be  not  like  dumb,  driven  cattle  I 

Be  a  hero  in  the  strife  1 


PART  V.  THE  LAW 


XXXVII 
LIBERTY  OF  CONTRACT^ 

"  "  I  ^HE  right  of  a  person  to  sell  his  labor,"  says  Mr.  Justice  Harlan, 
X  "upon  such  terms  as  he  deems  proper  is,  in  its  essence,  the 
same  as  the  right  of  the  purchaser  of  labor  to  prescribe  tJie  conditions 
upon  which  he  will  accept  such  labor  from  the  person  offering  to  sell 
it.  So  the  right  of  the  employee  to  quit  the  service  of  the  employer,  for 
whatever  reason,  is  the  same  as  the  right  of  the  employer,  for  what- 
ever reason,  to  dispense  with  the  services  of  such  employee.  ...  In  \ 
all  such  particulars  the  employer  and  the  employee  have  equality  of 
right,  and  any  legislation  that  disturbs  that  equality  is  an  arbitrary 
interference  with  the  liberty  of  contract,  which  no  government  can 
legally  justify  in  a  free  land."-  With  this  positive  declaration  of  a 
lawyer,  the  culmination  of  a  line  of  decisions  now  nearly  twenty-five 
years  old, — a  statement  which  a  recent  writer  on  the  science  of 
jurisprudence  has  deemed  so  fundamental  as  to  deserve  quotation 
and  exposition  at  an  unusual  length  as  compared  with  his  treatment 
of  other  points,^ — let  us  compare  the  equally  positive  statement  of 
a  sociologist:  "Much  of  the  discussion  about  *  equal  rights'  is 
utterly  hollow.  All  the  ado  made  over  the  system  of  contract  is 
surcharged  with  fallacy."* 

To  everyone  acquainted  at  first  hand  with  actual  industrial  con- 
ditions the  latter  statement  goes  without  saying.  Wliy,  then,  do 
courts  persist  in  the  fallacy  ?    Why  do  so  many  of  them  force  upon 

iprom  Yale  Law  Journal,  Vol.  XVIII  (1909),  pp.  454-487. 

-Adair  v.  United  States,  208  U.S.  161,  175, 

3 Taylor,  Science  of  Jurisprudence,  pp.  538-542. 

-^Ward,  Applied  Sociology,  p.  281.  See  Wright,  Practical  Sociology,  sth  ed., 
p.  226;  Seager,  Introduction  to  Economics,  3d  ed.,  sects.  234  ff.,  "For  one  who 
really  understands  the  facts  and  forces  involved,  it  is  mere  juggling  with  words 
and  empty  legal  phrases";  Ely,  Economic  Theory  and  Labor  Legislation,  p.  18. 

579 


illitii 


580       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

legislation  an  academic  theory  of  equality  in  the  face  of  practical 
conditions  of  inequality  ?    Why  do  we  find  a  great  and  learned  court 
in  1908  taking  the  long  step  into  the  past  of  dealing  with  the  relation 
between  employer  and  employee  in  railway  transportation  as  if  the 
parties  were  individuals— as  if  they  were  farmers  haggling  over  the 
sale  of  a  horse  ? '    Why  is  the  kgal  conc^lionjof_jhe.jelatiQix  of 
employer  and  employee  so  at  variance  with  the  common  knowledge 
of  mankind?    The  late  Tresident  has  told  us  that  it  is  becausejndi- 
vidual  judges  project  their  personal,  social,  and  economic  views  into 
the  law    A  great  German  publicist  holds  that  it  is  because  the  party 
bent   of  judges  has  dictated  decisions.^    But  when  a  doctrine   is 
announced  with  equal  vigor  and  held  with  equal  tenacity  by  courts 
of  Pennsylvania  and  of  Arkansas,  of  New  York  and  of  California,  of 
Illinois  and  of  West  Virginia,  of  Massachusetts  and  of  Missouri,  we 
may  not  dispose  of  it  so  readily.    Surely  the  sources  of  such  a  doc- 
trine must  lie  deeper.    Let  us  inquire,  then,  what  further  and  more 
potent  causes  may  be  discovered,  how  these  causes  have  operated  to 
brin-  about  the  present  state  of  the  law  as  to  freedom  of  contract, 
what  the  present  doctrine  of  the  courts  is  upon  that  subject,  and  how 
far  we  may  expect  amelioration  thereof  in  the  near  future. 

It  is  significant  that  the  subject,  so  far  as  the  form  it  now  takes 
is  concerned,  is  a  new  one.    The  phrase  "liberty  of  contract"  is  not 
to  be  found  in  Lieber's  "Civil  Liberty  and  Self-Government,    pub- 
lished  in    1853.   It   is   not   to   be   found   in    Professor    Burgess's 
*' Political  Science  and  Constitutional  Law,"  published  in  1890.   The_ 
1  first  decision  turning  upon  it  was   rendered  in_i886^  The   first 
extended  discussion  of  the  right  of  free  contract  as  a  fundamental 
natural   right   is   in   Spencer's   "Justice,"^   written   in    1891.    The 
eighteenth-century  writers  on  natural  law  say  nothing  about  it. 
Fichte's  discussion  of  the  natural  basis  of  civil  law  is  silent  with 
respect  to  it '    Even  Bentham  says  that  the  function  of  government 
is  to  create  and  confer  upon  individuals  "rights  of  personal  security, 
rights  of  protection  for  honor,  rights  of  property,  rights  of  receiving 

iSee  Mr.  Olney's  paper,  American  Law  Review,  Vol.  XLII,  p.  164. 

2  Jellinek,  System  der  subjectiven  offentlichen  Rechte,  p.  loi,  n.  i. 

^Godcharles  v.  Wigeman,  113  Pa.  St.  431. 

*  Spencer,  Justice,  chap.  xv. 

5The  Science  of  Rights  (translation),  p.  95- 


LIBERTY  OF  CONTRACT 


581 


aid  in  case  of  need."^  Ahrens  (1837)  argues  not  natural  liberty  of 
contract  but  natural  restraints  on  that  liberty .^  Grotius,  indeed,  at 
the  very  outset  of  the  school  of  natural  law,  mentions  liberty  of  con- 
tract as  a  natural  right."^  But  his  idea  was  not  at  all  the  one  with 
which  we  are  concerned  here.  He  was  insisting  not  on  the  unre- 
stricted right  to  make  promises  but  on  the  natural  force  of  promises 
when  made.*  For  the  chief  problem  of  the  natural-law  jurists  was  to 
square  the  practical  with  the  ideal,  to  test  all  things  by  reason  and 
to  throw  off  empty  forms.  They  warred  against  rules  derived  from 
antiquity  that  enforced  contracts  rather  than  promises.  They  argued 
that  enforceability  of  promises  should  depend  on  a  more  reasonable 
basis  than  form  or  than  the  traditional  categories  of  Roman  law. 
Hence  to  Grotius,  to  Puffendorf,'*  to  Burlamaqui,''  the  problem  was 
the  source  of  the  binding  power  of  a  promise.^  To  the  eighteenth- 
century  jurist  the  all-important  thing  was  that  promises  should  be 
kept.  Montesquieu's  description  of  the  Troglodytes,  who  perished 
utterly  because  they  willfully  violated  contracts,^  expresses  their 
feeling.  That  promises  have  in  fact  had  to  depend  during  the  greater 
part  of  legal  history  much  more  upon  individual  honesty  than  upon 
positive  law  seemed  to  them  at  variance  with  the  law  of  nature.^  We 
see  an  echo  of  this  discussion  in  the  opinion  of  Chief  Justice  Marshall 
in  Sturges  v.  Crownin shield}^ 

The  idea  that  unlimited  freedom  of  making  promises  was  a 
natural  right  came  after  enforcement  of  promises  when  made  had 
become  a  matter  of  course.  It  began  as  a  doctrine  of  political  econ- 
omy, as  a  phase  of  Adam  Smith's  doctrine  which  we  commonly  call 

^Theory  of  Legislation  (Hildreth's  translation),  p.  95, 

2Cours  de  droit  naturel,  Bk.  II,  sect.  83. 

•''De  Jure  Belli  et  Pacis,  Bk.  Ill,  chap,  xi,  sect.  4. 

*"And  again,  no  reason  can  be  found  why  laws,  which  are,  as  it  were,  a 
common  pact  of  the  people,  and  are  so  called  by  Aristotle  and  Demosthenes, 
should  be  able  to  give  obligatory  force  to  pacts,  which  the  will  of  a  person, 
directed  especially  and  by  every  means  to  obligating  himself,  may  not  do  so, 
especially  where  the  civil  law  offers  no  impediment  [i.e.  to  performance!"  {ibid. 
sect.  3). 

•^'Law  of  Nature  and  Nations,  Bk.  Ill,  chap.  iv. 

6  Principles  of  Natural  and  Politic  Law,  Bk.  II,  Pt.  IV,  chap,  x,  sect.  4.  See 
also  the  end  of  chap,  vii,  in  Bk.  I,  Pt.  I. 

■^  Ahrens,  Cours  de  droit  naturel,  8th  ed.,  Bk.  II,  sect.  238. 

^Lettres  persanes,  Lettre  XIV  et  seq. 

^Maine,  Ancient  Law,  Pollock's  ed.,  p.  325.  ^"^4  Wheaton  122,  197. 


m 


i 


:l 


Is 


I 


582       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

laisser  jaire}  It  was  propounded  as  a  utilitarian  principle  of  politics 
and  legislation  by  Mill.-  Spencer  deduced  it  from  his  formula  of 
justice.  In  this  way  it  became  a  chief  article  in  the  creed  of  those 
who  sought  to  minimize  the  functions  of  the  state  that  the  most 
important  of  its  functions  was  to  enforce  by  law  the  obligations 
created  by  contract.^  But  we  must  remember  that  the  task  of  the 
English  individualists  was  to  abolish  a  body  of  antiquated  institu- 
tions that  stood  in  the  way  of  human  progress.  Freedom  of  con- 
tract was  the  best  instrument  at  hand  for  the  purpose.  They  adopted 
it  as  a  means,  and  made  it  an  end.*  While  this  evolution  of  juristic 
and  political  thought  was  in  progresriRe~comnTon  Ta'w'too  had  Be- 
cofnrthrjTOUghly  individualistic ;  partly  from  innate  tendency,  partly 
through  theological  influence,  partly  through  the  contests  between  the 
courts  and  the  crown  in  the  sixteenth  and  seventeenth  centuries,  and 
partly  as  a  result  of  the  course  of  thought  in  the  eighteenth  and  nine- 
teenth centuries.  This  bit  of  history  may  suggest  the  chief,  although 
not  all,  of  the  causes  of  the  phenomenon  we  are  considering. 

In  my  opinion,  the  causes  to  which  we  must  attribute  the  course 
of  American  constitutional  decisions  upon  liberty  of  contract  are 
seven :  ( i )  the  currency  in  juristic  thought  of  an  individualist  con- 
ception of  justice  which  exaggerates  the  importance  of  property  and 
of  contract,  exaggerates  private  right  at  the  expense  of  public  right, 
and  is  hostile  to  legislation,  taking  a  minimum  of  lawmaking  to  be 
the  ideal ;  ( 2 )  what  I  have  ventured  to  call  on  another  occasion  a  con- 
dition of  mechanical  jurisprudence — a  condition  of  juristic  thought 
and  judicial  action  in  which  deduction  from  conceptions  has  pro- 
duced a  cloud  of  rules  that  obscures  the  principles  from  which  they 
were  drawn,  in  which  conceptions  are  developed  logically  at  the 
expense  of  practical  results,  and  in  which  the  artificiality  charac- 
teristic of  legal  reasoning  is  exaggerated  ;  (3)  the  survival  of  purely 

1  Wealth  of  Nations,  Bk.  IV,  chap  ix  (Thorold  Rogers'  ed.,  Vol.  II,  pp.  272- 
273).  Ricardo  laid  it  down  as  a  principle  of  political  economy  that  legislation 
should  not  interfere  with  contracts  (Works,  McCulloch's  ed.,  p.  57).  See  a 
discussion  of  the  juristic  bearings  of  these  doctrines  in  Berolzheimer's  "System 
der  Rechts-  und  Wirthschaftsphilosophie,"  Bk.  II,  sect.  32. 

2  Liberty,  chap.  iv. 

3 Ritchie,  Natural  Rights,  p.  227. 

*See  Dicey,  Law  and  Public  Opinion  in  England,  pp.  148-150;  Sidgwick, 
Elements  of  Politics,  2d  ed.,  p.  83. 


LIBERTY  OF  CONTRACT 


583 


juristic  notions  of  the  stai;e  and  of  economics  and  politics  as  against 
the  social  conceptions  of  the  present ;  (4)  the  training  of  judges  and 
lawyers  in  eighteenth-century  philosophy  of  law  and  the  pretended 
contempt  for  philosophy  in  law  that  keeps  the  legal  profession  in 
the  bonds  of  the  philosophy  of  the  past  because  it  is  to  be  found  in 
law- sheep  bindings;  (5)  the  circumstance  that  natural  law  is  the 
theory  of  our  bills  of  rights,  and  the  impossibility  of  applying  such 
a  theory  except  when  all  men  are  agreed  in  their  moral  and  economic 
views  and  look  to  a  single  authority  to  fix  them;  (6)  the  circum- 
stance that  our  earlier  labor  legislation  came  before  the  public  was 
prepared  for  it,  so  that  the  courts  largely  voiced  well-meant  but 
unadvised  protests  of  the  old  order  against  the  new,  at  a  time  when 
the  public  at  large  was  by  no  means  committed  to  the  new;^ 
and  (7),  by  no  means  least,  the  sharp  line  between  law  and  fact  in 
our  legal  system  which  requires  constitutionality,  as  a  legal  question, 
to  be  tried  by  artificial  criteria  of  general  application  and  prevents 
effective  judicial  investigation  or  consideration  of  the  situations  of 
fact  behind  or  bearing  upon  the  statutes. 

Four  stages  may  be  observed  in  the  development  of  the  juristici 
idea  of  justice.  Understand  me.  I  am  not  speaking  of  the  ethical 
conception  nor  of  the  political  conception,  closely  as  they  are  related 
to  and  much  as  they  may  have  determined  the  juristic  idea.  We 
say  that  the  end  of  law  is  the  administration  of  justice.  What  do  we 
mean  here  by  the  term  "justice"?  What  is  it  that  courts  and 
jurists  have  sought  to  accomplish  in  the  adjustment  of  human  rela- 
tions in  public  tribunals?  The  primitive  idea  was  simply  to  keep 
the  peace.  Justice,  juristically,  was  a  device  to  keep  the  peace. 
WTiatever  served  to  avert  private  vengeance  and  prevent  private 
war  was  an  instrument  of  justice.  The  Salic  Law  awarded  twice  the 
compensation  to  the  vigorous  and  half -civilized  Frank  that  it  did  to 
the  effete  and  civilized  Roman,  because  it  required  more  to  move  the 
Frank  to  restrain  his  anger  and  withhold  his  vengeance.^  But 
Greek  philosophy  and  Roman  law  soon  got  beyond  this  conception 
and  gave  us  in  its  place  an  idea  of  justice  as  a  device  to  preserve  the 
social  status  quOj  to  keep  each  man  in  his  appointed  groove  and  thus 

1  Professor  Seager  has  made  a  similar  suggestion  (Introduction  to  Economics, 
3d  ed.,  p.  417).  2  Salic  Law,  tit.  XIV. 


\ 


I 


I\ 


1 


II 


584       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

prevent  friction  with  his  fellows.  Plato  sets  this  out  very  clearly.^ 
In  his  ideal  state  "  every  member  of  the  community  must  be  assigned 
to  the  class  for  which  he  proves  himself  best  fitted.  Thus  a  perfect 
harmony  and  unity  will  characterize  both  the  state  and  every  person 
in  it."-  The  Stoic  doctrine  of  conformity  to  universal  reason  came 
to  much  the  same  practical  result. '  To  Aristotle  rights  existed  only 
between  those  who  were  free  and  equal  ;*  justice  demanded  a  unanim- 
ity in  which  there  would  be  no  violation  of  mutual  rights,'  and  law 
and  right  took  "account  in  the  first  instance  of  relations  of  in- 
equality, in  which  individuals  are  treated  in  proportion  to  their  worth, 
and  only  secondarily  of  relations  of  equality.'""'  Roman  legal  genius 
gave  practical  effect  to  this  idea  of  justice  by  making  it  the  province 
of  the  state  to  define  and  protect  interests  and  powers  of  action 
which  in  the  aggregate  made  up  the  legal  personality  of  the  indi- 
vidual.^ The  precepts  of  law,  as  laid  down  in  the  Institutes, — 
honeste  vivere,  alienum  non  laedere,  suum  cuique  tribuere, — come 
to  this.  As  Courcelle-Seneuil  has  put  it,  the  Roman  ideal  was  a  sta- 
tionary society,  corrected  from  time  to  time  by  a  reversion  to  the 
ancient  type.^  Roman  natural  law  was  simply  an  appeal  to  reason 
against  formalism.  The  natural  law  of  the  Middle  Ages  and  of  the 
seventeenth  century — an  appeal  to  reason  against  authority — is  a 
very  different  thing. 

Appeal  to  reason  against  authority  led  to  a  new  conception  in 
philosophy,  in  theology,  in  politics,  and  ultimately  in  legal  theory, 
as  a  result  of  which  justice  came  to  be  regarded  as  a  device  to 
secure  a  maximum  of  individual  self-assertion.  The  beginnings  of 
this  are  in  philosophy.  As  Lord  Acton  put  it,  "Not  the  devil,  but 
St.  Thomas  Aquinas  was  the  first  Whig."^    Teutonic  individualism, 

1  Republic,  Bk.  Ill,  p.  424- 

2  Dunning,  Political  Theories,  Ancient  and  Mediaeval,  p.  28. 
^Ibid.  p.  105. 

*Zeller,  Aristotle  and  the  Earlier  Peripatetics  (translated  by  Costelloe  and 
Muirhead),  Vol.  II,  p.  175. 
^Eth.  Nicomach.  VIII,  i,  24. 
«Zeller,  op.  cit.  Vol.  II,  p.  1Q7. 

7  This  is  well  put  in  Willoughby,  Political  Theories  of  the  Ancient  World, 

p.  64. 

8  Preparation  a  I'^tude  du  droit,  pp.  99,  396.  See  Guyot,  Principles  of  Social 
Economy  (Leppington's  translation,  2d  ed.),  p.  299. 

9  Figgis,  From  Gerson  to  Grotius,  p.  7. 


LIBERTY  OF  CONTRACT 


58s 


kept  back  by  Roman  authority  in  religion  and  law,  broke  over. 
Puritan  theology  gave  rise  to  ultraindividualism  in  church  polity 
and  religion.  The  appeal  to  reason  against  the  crown  developed-, 
political  doctrines  of  civil  liberty  and  natural  rights  of  the  individual. 
And  as  Coke,  the  great  light  of  our  legal  system,  was  in  the  fore- 
front of  the  controversy  with  the  crown  and  read  all  legal  history  in 
the  light  of  the  exigencies  of  that  controversy,^  the  liberties  of  the 
individual  Englishman  came  to  assume  a  central  point  in  that  sys- 
tem that  would  have  been  taken  by  public  good  and  the  powers 
of  the  state  if  Bacon  rather  than  Coke  had  been  the  inspiration 
of  eighteenth-century  commentators  and  nineteenth-century  courts. 
Moreover,  our  constitutional  models  and  our  bills  of  rights  were 
drawn  in  the  period  in  which  the  natural-law  school  of  jurists  was 
at  its  zenith,  and  the  growing  period  of  American  law  coincided  with 
the  high  tide  of  individualistic  ethics  and  economics.  Hence  his 
school  course  in  political  economy  and  his  office  reading  of  Black- 
stone  taught  the  nineteenth-century  judge  the  same  things  as  funda- 
mentals.^ He  became  persuaded  that  they  were  the  basis  of  the 
jural  order,  and,  as  often  happens,  the  individualist  conception  of 
justice  reached  its  complete  logical  development  after  the  doctrine 
itself  had  lost  its  vitality.  Social  justice,  the  last  conception  to  I 
develop,  had  already  begun  to  affect  not  merely  legal  thought  but    I 


^Compare  his  interpretation  of  Tregor's  Case  (Y.  B.8E.  3,  30)  and  the  case 
in  Fitzh.  Abr.  Cessavit,  42,  in  Bonham's  Case,  8  Rep.  108a,  ii8a,  with  the  cases 
themselves. 

2 "Like  all  other  contracts,  wages  should  be  left  to  the  fair  and  free  com- 
petition of  the  market,  and  should  never  be  controlled  by  the  interference  of 
the  legislature"  (Ricardo,  Principles  of  Political  Economy,  chap,  v,  sect,  7). 
Chap,  xi  of  Bk.  V  of  Mill's  "  Political  Economy,"  entitled  "  Of  the  Grounds  and 
Limits  of  the  Laisser-jaire  or  Non-interference  Principle,"  was  studied  by  every 
liberally  educated  lawyer  of  the  last  fifty  years.  Mill  {ibid.  sect.  12)  dis- 
approves of,  but  at  the  same  time  suggests  an  argument  in  favor  of,  legislation 
limiting  the  hours  of  labor.  In  Laughlin's  edition  (1884)  the  editor  argues 
against  such  legislation  (p.  193).  We  are  now  prepared  to  read  in  the  opinion 
of  O'Brien,  J.,  in  People  v.  Coler,  166  N.  Y.  i,  that  "A  law  that  restricts  the 
freedom  of  contract  on  the  part  of  both  the  master  and  servant  cannot  in  the 
end  operate  to  the  benefit  of  either"  (p.  16).  Also:  "It  was  once  a  political 
maxim  that  the  government  governs  best  which  governs  the  least.  It  is  possible 
that  we  have  now  outgrown  it,  but  it  was  an  idea  that  was  always  present  to 
the  minds  of  the  men  who  framed  the  Constitution,  and  it  is  proper  for  the 
courts  to  bear  it  in  mind  when  expounding  that  instrument"  (p.  14). 


586       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

[legislation  and  judicial  decision  while  the  courts  were  working  out 
I  the  last  extreme  deductions  from  the  older  conceptions/ 

M.  Worms,  taking  no  account  of  the  first  stage  above  suggested, 
has  summed  up  the  other  three  in  these  words :    "To  sum  up,  justice 
jjj^   ^pArj   \Q^nr^n\7.p  society   to   the  profit   of   force,  later   inde- 
pendently  of  force,  and  it  dreams  today  of^  organizing^  It^against 
force."-    But  our  ideal  of  justice  has  been  to  let  every  force  play 
freely  and  exert  itself  completely,  limited  only  by  the  necessity  of 
avoiding  friction.   As  a  result,  and  as  a  result  of  our  legal  history, 
we  exaggerate  the  importance  of  property,  and  of  contract  as  an 
incident  thereof.    A  leader  of  the  bar,  opposing  the  income  tax, 
argues  that  a  fundamental  object  of  our  polity  is  "preservation  of 
the  rights  of  private  property." '    Text  writers  tell  us  of  the  divine 
origin  of  property.*    The  Supreme  Court  of  Wisconsin  tells  us  that 
the  right  to  take  property  by  will  is  an  absolute  and  inherent  right, 
not  depending  upon  legislation.'    The  absolute  certainty  which  is 
one  of  our  legal  ideals,  an  ideal  responsible  for  much  that  is  irritat- 
ingly  mechanical  in  our  legal  system,  is  demanded  chiefly  to  protect 
property.*'    And  our  courts  regard  the  right  to  contract,  not  as  a 
phase  of  liberty — a  sort  of  freedom  of  mental  motion  and  locomo- 
tion— but  as  a  phase  of  property,  to  be  protected  as  such.^^_A_ 
further  result  is  to  exaggerate  private  right  at  the  expense  of  public 
interest.    Blackstone's  proposition  that  "  the  public  go'od  is  in  nothing 
more  essentially  interested  than  in  the  protection  of  every  individual's 
private   rights"^   has   been   quoted    in   more   than   one  American 

^See  my  paper  "The  Need  of  a  Sociological  Jurisprudence,"   Green  Bag, 

Vol.  XIX,  p.  607. 

2Philosophie  des  sciences  sociales,  Vol.  II,  p.  222. 

3  Argument  of  Mr.  Choate  in  the  Income  Tax  cases,  157  U.S.  429,  534. 

*  Smith,  Personal  Property,  sect.  33.  Berolzheimer  sums  up  the  characteristic 
features  of  common-law  legal  speculation  thus:  "UnHmited  high  valuation 
of  individual  freedom  and  respect  for  individual  property''  (System  der  Rechts- 
und  Wirthschaftsphilosophie,  11,  160). 

^Nunnemacher  v.  State,  108  N.  W.  627. 

«See  my  paper  "Enforcement  of  Law,"  Green  Bag,  Vol.  XX,  pp.  401,  408. 

7 Occasionally  it  is  said  to  be  "both  a  liberty  and  a  property  right"  {Frorer 
V.  People,  141  111.  171,  i8i).  Professor  Seager  suggests  another  reason  for 
American  exaggeration  of  the  importance  of  property  (Introduction  to  Eco- 
nomics, 3d  ed.,  p.  21).  He  points  out  that  this  exaggeration  has  resulted  in  "an 
industrial  civilization  which  has  been  marked  thus  far  by  intense  individualism 
in  thought  and  practke."  *^  Comm.  p.  139- 


II 


s 


LIBERTY  OF  CONTRACT 


S87 


decision;^  and  one  of  these  is  a  case  often  cited  in  support  of 
extreme  doctrines  of  liberty  of  contract.^  It  is  but  a  corollary 
that  liberty  of  contract  cannot  be  restricted  merely  in  the  interest 
of  a  contracting  party.  His  right  to  contract  freely  is  to  yield  only 
to  the  safety,  health,  or  moral  welfare  of  the  public.^  Still  another 
result  is  that  bench  and  bar  distrust  and  object  to  legislation.  I  have 
discussed  the  history  and  the  causes  of  this  attitude  toward  legisla- 
tion on  another  occasion.*  Suffice  it  to  say  here  that  the  doctrine 
as  to  liberty  of  contract  is  bound  up  in  the  decisions  of  our  courts 
with  a  narrow  view  of  what  constitutes  special  or  class  legislation 
that  greatly  limits  effective  lawmaking.  If  we  can  have  only  laws 
of  wide  generality  of  application,  we  can  have  only  a  few  laws ;  for 
the  wider  their  application,  the  more  likelihood  there  is  of  injustice 
in  concrete  cases.  But  from  the  individualist  standpoint  a  minimum 
of  law  is  desirable.  TEecommon-law  antipathy  to  legislation  sympa- 
"nTi2e5'lVTth-thi&,  and  in  consequence  we  find  courts  saying  that  it  is 
not  necessary  to  consider  the  reasons  that  led  up  to  the  type  of 
legislation  they  condemn^  and  that  the  maxim  that  the  government 
governs  best  which  governs  least  is  proper  for  courts  to  bear  in 
mind  in  expounding  the  Constitution.^ 

The  second  cause,  a  condition  of  mechanical  jurisprudence,  I  have 
discussed  in  its  relation  to  the  legal  system  generally  in  another 
place."  Theegect  of  all  system .  is  apt  to  be^petf  if  action  of  the 
subject  systematized.  Legal  science  is  not  exempt  from  this  tend- 
encyT^tegai  systems  have  their  periods  in  which  system  decays  into 
technicality,  in  which  a  scientific  jurisprudence  becomes  a  mechanical 
jurisprudence.  In  a  period  of  growth  through  juristic  speculation 
and  judicial  decision  there  is  little  danger  of  this.  But  whenever  such 
a  period  has  come  to  an  end,  when  its  work  has  been  done  and  its 

1  See,  for  example,  Wynhamer  v.  People,  13  N.  Y.  378,  387;  Chase  v.  Beal,  31 
Mich.  491. 

2  Wynhamer  v.  People,  supra. 

^People  V.  Marcus,  128  N.  Y.  257;  In  re  House  Bill  203,  21  Col.  27. 

*"  Common  Law  and  Legislation,"  Harvard  Law  Review,  Vol.  XXI,  p.  383. 

s"For  some  reason,  not  necessary  to  consider,  there  has  in  modern  times 
arisen  a  sentiment  favorable  to  paternalism  in  matters  of  legislation"  {Lowe  v. 
Rees  Printing  Co.,  41  Neb.  127,  135).     Cf.  State  v.  Kreutzberg,  114  Wis.  530, 

537. 

^People  v.  Coler,  166  N.  Y.  i,  14. 

'"Mechanical  Jurisprudence,"  Columbia  Law  Review,  Vol.  VIII,  p.  605. 


l! 


588       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


Ik 


jji 


i 


legal  theories  have  come  to  maturity,  jurisprudence  tends  to  decay. 
Conceptions  are  fixed.  The  premises  are  no  longer  to  be  examined. 
Ever>'thing  is  reduced  to  simple  deduction  from  them.  Principles 
cease  to  have  importance.  The  law  becomes  a  body  of  rules.  This 
is  the  condition  Professor  Henderson  refers  to  when  he  speaks  of 
the  way  of  social  progress  as  barred  by  barricades  of  dead  prece- 
dents.^ ^lanifestations  of  mechanical  jurisprudence  are  conspicuous 
iii^ the  decisions  as  to  liberty  of  contract.  A  chafa«erfettc~OTTrts 
the  rigor6uFTogrcaT~Heduction  from  predetermined  conceptions,  in 
disregard  of  and  often  in  the  teeth  of  the  actual  facts,  which  was 
noted  at  the  outset.  Two  courts,  in  passing  on  statutes  abridging 
the  power  of  free  contract,  have  noted  the  frequency  of  such  legis- 
lation in  recent  times  but  have  said  that  it  was  not  necessary  to 
consider  the  reasons  for  it.-  Another  court  has  asked  what  right  the 
legislature  has  to  ^^  assume  that  one  class  has  the  need  of  protection 
against  another."  ^  Another  has  said  that  the  remedy  for  the 
company -store  evil  "is  in  the  hands  of  the  employee,"  since  he  is 
not  compelled  to  buy  from  the  employer,*  forgetting  that  there  may 
be  a  compulsion  in  fact  where  there  is  none  in  law.  Another  says 
that  "theoretically  there  is  among  our  citizens  no  inferior  class," ^ 
and  of  course  no  facts  can  avail  against  that  theory.  Another  tells 
us  that  man  and  woman  have  the  same  rights,  and  hence  a  woman 
must  be  allowed  to  contract  to  work  as  many  hours  a  day  as  a  man 
may.*^  We  have  already  noted  how  Mr.  Justice  Harlan  insists  on  a 
legal  theory  of  equality  of  rights  in  the  latest  pronouncement  of  the 
federal  Supreme  Court.  Legislation  designed  to  give  laborers  some 
measure  of  practical  independence,  which,  if  allowed  to  operate, 

^American  Journal  of  Sociology,  Vol.  XI,  p.  847. 

2  See  cases  in  note  5  on  the  preceding  page. 

^ State  V.  Haiin,  61  Kan.  146,  162. 

estate  V.  Fire  Creek  Coal  &  Coke  Co.,  33  W.Va.  188,  iqo.  Those  who  have 
studied  the  actual  situation  do  not  look  at  it  in  this  way.  "He  is  not  free  to 
make  such  a  contract  as  might  please  him  because,  Hke  every  party  to  a  contract, 
he  must  come  to  such  conditions  as  can  possibly  be  agreed  upon.  He  is  less 
free  than  the  parties  to  most  contracts,  and,  further,  he  cannot  utilize  his  labor 
in  many  directions;  he  must  contract  for  it  within  restricted  lines"  (Wright, 
Practical  Sociology,  5th  ed.,  p.  226). 

^Frorer  v.  People,  141  111.  171,  186,  holding  against  a  statute  prohibiting 
company  stores  and  requiring  miners  to  be  paid  weekly. 

'•Ritchie  v.  People,  155  lU.  99,  in. 


LIBERTY  OF  CONTRACT 


589 


would  put  them  in  a  position  of  reasonable  equality  with  their 
masters,  is  said  by  courts,  because  it  infringes  on  a  theoretical 
equality,  to  be  insulting  to  their  manhood^  and  degrading,-  to  put 
them  under  guardianship,'^  to  create  a  class  of  statutory  laborers,* 
and  to  stamp  them  as  imbeciles. '  I  know  of  nothing  akin  to  this 
artificial  reasoning  in  jurisprudence  unless  it  be  the  explanation 
given  by  Pomponius  for  the  transfer  of  legislative  power  from  the 
Roman  people  during  the  Empire:  "The  plebs  found,  in  course  of 
time,  that  it  was  difficult  for  them  to  meet  together,  and  the  general 
body  of  the  citizens  no  doubt  found  it  more  difficult  still."®  No 
doubt  they  did.  Caesar  or  the  praetorian  prefect  would  have  seen 
to  that. 

Survival  of  a  purely  juristic  notion  of  the  state  and  of  economics 
and  politics  in  contrast  with  the  social  conception  of  the  present, 
the  third  cause  suggested,  can  be  looked  at  but  briefly.  Formerly 
the  juristic  attitude  obtained  in  religion,  in  morals,  and  in  politics 
as  well  as  in  law.  This  fundamentally  juristic  conception  of  the 
world — due  possibly  to  Roman  law  being  the  first  subject  of 
study  in  the  universities,  which  gave  a  form  of  legality  even  to 
theology — has  passed  away  elsewhere.  But  it  lingers  in  the  courts. 
Jurisprudence  is  the  last  in  the  march  of  the  sciences  away  from 
the  method  of  deduction  from  predetermined  conceptions.  The  socio- 
logical movement  in  jurisprudence,  the  movement  for  pragmatism  as 
a  philosophy  of  law,  the  movement  for  the  adjustment  of  principles 
and  doctrines  to  the  human  conditions  they  are  to  govern  rather  than 

'^Godcharles  v.  Wigeman,  113  Pa.  St.  431,  437  (wages  in  iron  mills  to  be  paid 
in  money). 

^ State  V.  Goodwill,  33  W.Va.  179,  186  (store  orders). 

^Braceville  Coal  Co.  v.  People,  147  111.  66,  74  (coal  to  be  weighed  for  fixing 
wages) ;  State  v.  Haiin,  61  Kan.  146,  162  (wages  to  be  paid  in  money). 

^People  V.  Beck,  10  Misc.  77  (dissenting  opinion  of  White,  J.).  The  statute 
fixed  hours  of  labor  on  municipal  contracts. 

•'State  v.  Goodwill,  supra;  Frorer  v.  People,  141  HI.  171,  187  (company 
stores) . 

^'Dig.  I,  2,  2,  sect.  9.  Professor  Seager  says  of  these  objections:  "The  op- 
position to  such  regulations  ...  is  based  on  the  fear  that  they  may  serve  to 
undermine  the  spirit  of  independence  of  the  protected  persons.  Experience 
seems  to  indicate  that  they  have  in  fact  a  directly  contrary  effect"  (Introduction 
to  Economics,  3d  ed.,  p.  421).  See  also  p.  423  :  "Those  who  advance  it  fail  to 
consider  that  deadening  and  monotonous  toil  too  long  continued  is  much  more 
inimical  to  the  spirit  of  independence  than  any  amount  of  legislation." 


i| 


590      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

to  assumed  first  principles,  the  movement  for  putting  the  human 
factor  in  the  central  place  and  relegating  logic  to  its  true  position 
as  an  instrument,  has  scarcely  shown  itself  as  yet  in  America.  Per- 
haps the  dissenting  opinion  of  Mr.  Justice  Holmes  in  Lochner  v.  New 
York^  is  the  best  exposition  of  it  we  have. 

Another  factor  of  no  mean  importance  in  producing  the  line  of 
decisions  we  are  considering  is  the  training  of  lawyers  and  judges  in 
eighteenth-century  theories  of  natural  law.    In  a  book  just  published 
by  a  well-known  writer  on  legal  subjects,  who  has  also  been  a 
teacher  of  law,  the  whole  basis  of  discussion  is  natural  law.    The 
learned  author  does  not  indicate  a  suspicion  that  any  doubt  has 
been  cast  upon  or  may  attach  to  his  philosophical  premises.^    In  an- 
other book,  published  last  year  by  a  well-known  practitioner,  it  is 
recommended  gravely  that  one  subject  of  required  study  in  prepara- 
tion for  the  bar  be  "natural  and  civil  law,  and  the  principles,  founda- 
tion, and  spirit  of  law,"  and  the  student  is  expected  to  learn  these 
from  Grotius,  Paley's   "Moral  and  Political   Philosophy,"   Burla- 
maqui's  "Natural  Law,"  Puffendorf,  and  Macintosh's  "Discourses 
on  the  Study  of  the  Law  of  Nature  and  Nations."^    Until  a  com- 
paratively recent  date  all  legal  education,  whether  in  school  or  in 
office,  began  with  the  study  of  Blackstone.    Probably  all  serious 
office  study  begins  with   Blackstone   or  some  American  imitator. 
Many   schools   make   Blackstone   the   first   subject   of   instruction 
today,  and  in  others  Blackstone  is  a  subject  of  examination  for 
admission  or  of  prescribed  reading  after  admission,  or  there  are 
courses  on  elementary  law  in  which  texts  reproducing  the  theories 
of  the  introduction  to  and  the  first  book  of  the  "  Commentaries  "  are 
the  basis  of  instruction.    A  student  who  is  college  trained  may  have 
had  a  course  or  courses  that  brought  him  in  contact  with  modem 
thought.    It  is  quite  as  likely  he  has  not,  or  if  he  has,  the  natural- 
law  theories  which  are  a  matter  of  course  in  all  our  law  books  are  not 
unlikely  to  persuade  him  that  what  he  learned  in  college  is  immaterial 
in  the  domain  of  law.*     Constitutional  law  is  full  of  natural-law 

I198  U.S.  45,  75.  But  see  also  Holmes,  "The  Path  of  the  Law,"  Harvard 
Law  Review,  Vol.  X,  pp.  457,  467.  472. 

-'Schouler,  Ideals  of  the  Republic.    1808. 

3  Dos  Passos,  The  American  Lawyer,  p.  108.    1Q07. 

4Cf.  the  review  of  Schouler's  "Ideals  of  the  Republic,"  Harvard  Law  Re- 
view, Vol.  XXII,  p.  317. 


i\ 


LIBERTY  OF  CONTRACT 


591 


notions.  For  one  thing,  there  is  the  doctrine  that  apart  from  consti- 
tutional restrictions  there  are  individual  rights  resting  on  a  natural 
basis,  to  which  courts  must  give  effect,  "beyond  the  control  of  the 
state."  1  In  the  judicial  discussions  of  liberty  of  contract  this  idea 
has  been  very  prominent.  The  Supreme  Court  of  Massachusetts, 
in  passing  on  legislation  directed  against  fines  in  cotton  mills,  tells  us 
that  a  statute  which  violates  "fundamental"  rights  "is  unconstitu- 
tional and  void,  even  though  the  enactment  of  it  is  not  expressly 
forbidden."-  Another  court  reminds  us  that  natural  persons  do  not 
derive  their  right  to  contract  from  the  law.^  Another  court,  in 
passing  adversely  upon  legislation  against  company  stores,  says 
any  classification  is  arbitrary  and  unconstitutional  unless  it  pro- 
ceeds on  "the  natural  capacity  of  persons  to  contract."*  Another, 
in  passing  on  a  similar  statute,  denies  that  contractual  capacity  can 
be  restricted,  except  for  physical  or  mental  disabilities.^  Another 
holds  that  the  legislature  cannot  take  notice  of  the  de  facto  sub- 
jection of  one  class  of  persons  to  another,  in  making  contracts  of 
employment  in  certain  industries,  but  must  be  governed  by  the 
theoretical,  jural  equality .«  These  natural-law  ideas  are  carried  to 
an  extreme  by  the  Supreme  Court  of  Illinois  in  Ritchie  v.  People,'^ 
in  which  case  it  is  announced  that  women  have  a  natural  equality 
with  men  and  that  no  distinction  may  be  drawn  between  them  with 
respect  to  power  of  engaging  to  labor. 

Closely  related  to  the  ideas  just  considered,  and,  indeed,  a  product 
/  of  the  same  training,  is  a  deep-seated  conviction  of  the  American 
lawyer  that  the  doctrines  of  the  common  law  are  part  of  the  univer- 
sal jural  order.   Just  as,  in  nine  cases  out  of  ten,  natural  law  meant 

1  Harlan,  J.,  in  Railway  Co.  v.  Chicago,  206  U.S.  226,  237  (saying  that  com- 
pensation for  property  taken  for  a  public  use  is  a  "  settled  principle  of  universal 
law  reaching  back  of  all  constitutional  provisions");  Field,  J.,  in  Butchers' 
Union  etc.  Co.  v.  Crescent  City  etc.  Co.,  iii  U.S.  746,  762  ("When  such 
[police]  regulations  do  not  conflict  with  any  constitutional  inhibition  or  natural 
right,  their  validity  cannot  be  successfully  controverted");  Miller,  J.,  in  Loan 
Association  v.  Topeka,  20  Wall  655,  662 ;  Marshall,  C.  J.,  in  Fletcher  v.  Peck, 
6  Cranch.  87;  Iredell,  J.,  in  Calder  v.  Bull,  3  DaU.  386. 

2C0W.  v.  Perry,  155  Mass.  117  (1891). 

^Leep  V.  Railway  Co.,  58  Ark.  407,  427. 

*  State  V.  Loomis,  115  Mo.  307,  315. 

estate  v.  Fire  Creek  Coal  &  Coke  Co.,  33  W.  Va.  188. 

^State  V.  Haun,  61  Kan.  140,  162.  "iSS  HI-  99- 


" 


592       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


1 


. 


for  the  seventeenth-century  and  eighteenth-century  jurist  the  Roman 
law  which  he  knew  and  had  studied,  for  the  common-law  lawyer 
it  means  the  common  law/  For  one  thing,  this  feeling  leads  to  a 
narrow  attitude  toward  legislation— a  tendency  to  hold  down  all 
statutory  innovations  upon  the  common  law  as  far  as  possible.-'  In 
like  spirit,  on  this  subject  of  liberty  of  contract,  most  of  the  courts 
which  have  overthrown  legislation  as  being  in  derogation  of  liberty 
have  insisted  that  only  common-law  incapacities  can  be  given  legal 
recognition;'  that  new  incapacities  in  fact,  growing  out  of  new 
conditions  in  business  and  industry,  cannot  be  taken  advantage  of  in 
legislation ;  that  the  ordinary  farm  hand  and  the  laborer  in  the  beet 
fields,  for  example,  must  be  treated  alike.  But,  even  more  im- 
portant for  our  purpose,  this  feeling  operates  in  constitutional  law  to 
lead  judges  to  try  statutes  by  the  measure  of  common-law  doctrines 
rather  than  by  the  Constitution.^ 

^The  classical  instance  of  this  is  Cutting's  Case  (Snow,  Cases  on  Interna- 
tional Law,  p.  172).  See  also  Marcy's  confusion  of  the  rules  as  to  citizenship  in 
the  several  states  of  the  United  States  with  the  rules  of  International  Law  as  to 
national  character  (Cockburn,  Nationality,  p.  118  ct  seq.). 

2 See,  for  some  examples  of  this,  my  paper  "Common  Law  and  Legislation," 
Harvard  Law  Review,  Vol.  XXI,  p.  383.  Another  example  is  to  be  seen  in  the 
judicial  restrictions  on  the  applications  of  Lord  Campbell's  Act  {Deni  v.  Pennsyl- 
vania Co.,  181  Pa.  St.  527;  Brannigan  v.  Union  Min.  Co.,  93  Fed.  164;  McMillan 
V.  Spider  Jake  etc.  Co.,  115  Wis.  332;  Roberts  v.  Great  Northern  R.  Co.,  161 
Fed.  Rep.  239).  The  spirit  of  the  courts  in  these  cases  is  well  illustrated  by  the 
following  remark  of  the  Supreme  Court  of  Pennsylvania :  "  We  must  remember 
that  the  injury  complained  of  is  due  to  the  negligence  of  a  fellow  workman,  for 
which  the  master  is  responsible  neither  in  law  nor  moraW  {Durkin  v.  Coal  Co  , 
171  Pa.  St.  193,  202).  Cf.  Best,  C.  J.,  in  Fairlee  v.  Herring,  3  Bing.  625,  630:' 
"I  am  happy  to  find  in  this  case  that  which  I  find  in  most  others,  where 
statutes  have  not  interfered,  that  the  common  law  will  enable  us  to  do  justice." 

estate  V.  Goodwill,  33  W.  Va.  179;  State  \.  Fire  Creek  Coal  &  Coke  Co., 
Z2>  W.  Va.  188,  190;  Frorer  v.  People,  141  111.  171,  186;  State  v.  Loomi^, 
lis  Mo.  307,  315.  In  State  v.  Loomis  the  Court  speaks  of  the  common-law  in- 
capacities as  "natural  incapacities."  But  these  cases  all  distinguish  usury  laws, 
because  such  legislation  has  come  to  be  part  of  our  American  common  law. 

*Cf.  the  attempt  of  the  Supreme  Court  of  Pennsylvania  to  read  contributory 
negligence  into  the  Federal  Safety  Appliances  Act  (Schlemmer  v.  Buffalo  R.  & 
P.  R.  Co.,  20s  U.S.I).  But  the  most  remarkable  example  is  to  be  seen  in 
Grossman  v.  Caminez,  79  App.  Div.  (N.Y.)  15,  in  which  one  of  the  judges, 
regardmg  the  Statute  of  Frauds  as  part  of  the  legal  order  of  nature,  said  of 
a  statute  which  required  agents  attempting  to  sell  city  lots  to  have  written 
authority :  "  It  is  a  denial  ...  of  a  right  or  privilege,  guaranteed  to  citizens, 
to  make  verbal  contracts  which  are  to  be  performed  within  a  year." 


LIBERTY  OF  CONTRACT 


593 


Not  only,  however,  is  natural  law  the  fundamental  assumption  of 
our  elementary  books  and  of  professional  philosophy,  but  we  must  not 
forget  that  it  is  the  theory  of  our  bills  of  rights.  Not  unnaturally, 
therefore,  courts  have  clung  to  it  as  being  the  orthodox  theory  of 
our  constitutions.  But  the  fact  that  the  framers  held  that  theory 
by  no  means  demonstrates  that  they  intended  to  impose  the  theory 
upon  us  for  all  time.  It  is  contrary  to  their  principles  to  assume 
that  they  intended  to  dictate  philosophical  or  juristic  beliefs  and 
opinions  to  those  who  were  to  come  after  them.  What  they  did  in- 
tend was  the  practical  securing  of  each  individual  against  arbitrary 
and  capricious  governmental  acts.  They  intended  to  protect,  the 
people  against  their  rulers,  not  against  themselves.  They  laid  down 
principles,  not  rules,  and  rules  can  only  be  illustrations  of  those 
principles  so  long  as  facts  and  opinions  remain  what  they  were  when 
the  rules  were  announced.  For  instance:  The  cases  agree  that  the 
term  ''liberty"  is  broader  than  Coke's  use  of  it;  that  the  fact  that 
Coke  confined  it  to  freedom  of  physical  motion  and  locomotion  does 
not  exclude  a  broader  interpretation  today.  Yet  the  same  courts 
that  recognize  that  "liberty"  must  include  more  today  than  it  did 
as  used  in  Coke's  "Second  Institute"  lay  it  down  that  incapacities 
are  to  remain  what  they  were  at  common  law ;  that  new  incapacities 
of  fact,  arising  out  of  present  industrial  situations,  may  not  be 
recognized  by  legislation.^  This  is,  in  truth,  but  another  illustration 
of  the  purely  personal  character  of  all  natural-law  theories.^ 


■« 


'^Frorer  v.  People,  141  III.  171,  181,  185-187;  Ritchie  v.  People,  155 
III.  99,  hi;  Harding  v.  People,  160  111.  459,  467;  State  v.  Haun,  61  Kan. 
146,  162.    Cf.  People  V.  Marx,  99  N.Y.  377. 

2 See  some  illustrations  in  my  paper  "Common  Law  and  Legislation,"  Har- 
vard Law  Review,  Vol.  XXI,  pp.  383,  392-393-  See  also  the  statement  of 
Curtis,  J.,  in  Scott  v.  Sanford,  that  "all  writers"  agree  that  slavery  "is  created 
only  by  municipal  law"  (19  How.  393,  626).  But  Aristotle  (Politics,  Bk.  I, 
chap,  v),  Grotius  (II,  5,  27,  sect.  2  and  29,  sect.  2)  and  Rutherforth  (Natural 
Law,  Bk.  I,  chap,  xx,  sect.  4),  who  are  not  insignificant  authorities,  argue  that 
slavery  has  a  natural  basis  in  some  cases,  beyond  and  apart  from  law.  Again, 
in  Wynhamer  v.  People,  13  N.Y.  378,  454,  Hubbard,  J.,  said:  "Liquor  is  not 
a  nuisance  per  se,  nor  can  it  be  made  so  by  a  simple  legislative  declaration.'' 
Since  that  time  people  have  changed  their  minds,  and  we  find  another  judge 
saying :  "  The  entire  scheme  of  prohibition  as  embodied  in  the  Constitution  and 
laws  of  Kansas  might  fail  if  the  right  of  each  citizen  to  manufacture  intoxicat- 
ing liquors  for  his  own  use  or  as  a  beverage  were  recognized.  Such  a  right  does 
not  inhere  in  citizenship''  (Harlan,  J.,  in  Mngler  v.  Kansas,  123  U.S.  623). 


i 


594       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Last  of  the  causes  suggested,  but  by  no  means  the  least  efficient 
in  bringing  about  the  line  of  decisions  under  consideration,  is  the 
sharp  line  betweeji  law  and  faa  in  our  legal  system,  due  origi- 
nailyTo  the  exigencies  of  trial  by  jury.  The  line  between  what  is 
for  the  court  to  pass  upon  and  what  Is"for  the  jury  has  come  to  be 
called  a  line  between  law  and  fact.  For  purposes  of  jury  trial  the 
line  itself  has  to  be  drawn  often  very  artificially.  But,  beyond  that, 
when  it  is  drawn,  the  tendency  is  to  assume  that  questions  which 
analytically  are  pure  questions  of  fact,  when  they  become  questions 
for  the  court  to  decide  must  be  looked  at  in  a  different  way  from 
ordinary  questions  of  fact  and  must  be  dealt  with  in  an  academic 
and  artificial  manner  because  they  have  become  questions  of  law. 
The  tendency  to  insist  upon  such  a  line,  and  to  draw  it  arbitrarily, 
has  spread  from  the  law  of  trials  to  every  part  of  the  law.  One 
example  is  to  be  seen  in  decisions  as  to  what  is  a  reasonable  time 
in  the  law  of  negotiable  instruments.  Another  may  be  seen  in  judi- 
cial pronouncements  as  to  negligence,  which  are  leading  so  many  of 
our  state  legislatures  to  turn  the  whole  matter  over  to  juries  in  cases 
of  personal  injury.  Still  another  may  be  seen  in  the  refinements 
as  to  constructive  fraud  and  badges  of  fraud,  which  led  to  wide- 
spread legislation  making  fraud  a  question  for  the  jury.  It  is  one 
of  the  chief  factors  in  producing  what  I  have  ventured  to  call 
mechanical  jurisprudence  in  our  legal  system.  In  constitutional  law 
the  necessity  for  drawing  this  line,  and  the  assumption  that  what- 
ever is  left  to  the  court  to  decide  must  be  dealt  with  artificially  and 
disposed  of  mechanically,  operates  to  the  disadvantage  of  new  types 
of  legislation.  It  is  felt  that  a  law  cannot  be  constitutional  now  if 
it  would  have  been  unconstitutional  one  hundred  years  ago.  In  fact 
it  might  have  been  an  unreasonable  deprivation  of  liberty  as  things 
were  even  fifty  years  ago  and  yet  be  a  reasonable  regulation  as 
things  are  now.  But  the  question  is  not  one  of  fact.  Being  for  the 
court  to  decide,  it  must  be  decided  upon  some  universal  proposition, 
valid  in  all  places  and  at  all  times.^    Rate  laws,  in  the  investigation 


1  Hence,  when  a  court  had  to  decide  whether  the  common-law  doctrine  of 
riparian  rights  was  applicable  to  and  hence  in  force  in  a  state  where  one  part 
was  arid,  so  that  the  doctrine  could  not  be  applied,  another  part  had  abundant 
rainfall,  so  that  the  doctrine  was  well  suited  thereto,  and  still  another  sometimes 
had  rain  and  sometimes  not,  it  could  not  say  the  rule  applies  here  and  does  not 


LIBERTY  OF  CONTRACT 


595 


of  which  it  may  prove  that  a  rate  is  confiscatory  at  one  time  and 
not  at  another,  are  compelling  courts  to  recognize  that  the  constitu- 
tionality of  a  statute  may  depend  upon  a  pure  question  of  fact,  to 
be  investigated  and  determined  as  such.  Hence  they  are  likely  to 
induce  a  change  of  judicial  attitude  toward  other  legislation,  the 
reasonableness  of  which  must  depend  upon  questions  of  fact,  which 
only  those  who  have  investigated  special  industrial  situations  can 
fairly  determine.  As  it  is,  in  the  ordinary  case  involving  constitu- 
tionality the  court  has  no  machinery  for  getting  at  the  facts.  It 
must  decide  on  the  basis  of  matters  of  general  knowledge  and  on 
accepted  principles  of  uniform  application.  It  cannot  have  the 
advantage  of  legislative  reference  bureaus,  of  hearings  before  com- 
mittees, of  the  testimony  of  specialists  who  have  conducted  detailed 
investigations,  as  the  legislature  can  and  does.  The  court  is  driven 
to  deal  with  the  problem  artificially  or  not  at  all,  unless  it  is  willing 
to  assume  that  the  legislature  did  its  duty  and  to  keep  its  hands  off 
on  that  ground.  More  than  anything  else,  ignorance  of  the  actual 
situations  of  fact  for  which  legislation  was  provided  and  supposed 
lack  of  legal  warrant  for  knowing  them  have  been  responsible  for 
the  judicial  overthrowing  of  so  much  social  legislation. 

Turning  now  to  the  actual  state  of  the  decisions,  let  us  look  first 
at  the  cases  in  which  the  idea  of  liberty  of  contract  has  been  in- 
voked to  defeat  legislation.  The  fountainhead  of  this  line  of  decisions 
seems  to  be  the  opinion  of  Mr.  Justice  Field  in  Butchers'  Union  Co. 
V.  Crescent  City  Co.,^  in  which  he  restates  the  views  of  the  minority 
in  the  Slaughter  House  Cases.""  This  opinion  has  been  one  of  the 
staple  citations  in  causes  involving  liberty  of  contract.^  In  it  he 
took  a  vigorous  stand  against  legislative  interference  with  the 
"ri^ht  to  follow  lawful  callings.'.'  Although  it  did  not  represent  the 
views  of  the  federal  Supreme  Court,  this  opmion  had  a  far-reaching 

apply  there,  depending  on  the  facts,  but  had  to  insist  upon  one  rule  for  the 
whole  state  {Meng  v.  Coffey,  67  Neb.  500). 

ilii  U.S.  746,  762. 

2 16  Wall,  36. 

3  Cited  and  relied  on  particularly  in  State  v.  Goodwill,  33  W.  Va.  179,  183, 
and  through  this  case  and  the  New  York  cases  in  nearly  all  the  later  decisions. 
It  is  interesting  to  note  that  the  Supreme  Court  of  Illinois,  at  least,  has  fallen 
into  a  settled  practice  of  citing  the  opinion  of  the  minority  in  the  Slaughter 
House  Cases  as  if  it  were  that  of  the  Court. 


i* 


I 


596       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

influence  in  the  state  courts.   It  produced  a  reactionary  line  of  deci- 
siOTirm  New  YoTTSTilberty  to  pursue  one's  calling/  and  through 
these  cases  its  echoes  are  still  ringing  in  the  books.   Mr.  Justice 
Field  was  eminently  the  man  to  lead  this  belated  individualist  cru- 
sade    In  him  a  Puritan  ancestry  and  a  Puritan  bringing  up^  were 
followed  by  a  professional  career  upon  the  frontier  in  the  time  and 
at  the  place  where  the  individual  counted  for  more  and  the  state- 
imposed  law  for  less  than  at  any  other  period  in  our  history.   Thus 
predisposed,   his    thorough   study   and    minute   knowledge    of   the 
common-law  authorities  could  not  fail  to  make  him  a  prophet  of 
common-law  individualism.    How  zealously  he  performed  his  pro- 
phetic calling  the  vogue  today  of  his  dissenting  opinion  of  thirty-five 
years  ago,  uttered  to  another  generation  and  in  view  of  a  distinct 
industrial  situation,  bears  abundant  witness.    But  the  line  of  deci- 
sions culminating  in  the  Adair  Case  begins  directly  with  a  dictum  of 
the  Supreme  Court  of  Illinois,  a  court  which  has  since  attained  a 
bad  eminence  in  this  connection,  to  the  effect  that  legislation  pro- 
viding how  coal  should  be  weighed  in  fixing  the  compensation  of 
miners  was  an  undue  interference  with  liberty  of  contract.-^    Two 
years  later  two  cases  were  decided  upon  the  express  point.   The 
pioneer,  and,  so  far  as  influence  upon  the  later  decisions  is  concerned 
the  leading  case,  is  Godcharles  v.  Wigeman,'  in  which,  in  an  offhand 
and  positive  pronouncement,   without   discussion   or   citation,   the 
Court  declared  that  a  statute  requiring  payment  in  money  of  wages 
in  iron  mills  was  "degrading  and  insulting"   to  the  laborer  and 
"subversive  of  his  rights  as  a  citizen."    It  said:  "An  attempt  has 
been  made  by  the  legislature  to  do  what  cannot  be  done ;  that  is, 
prevent  persons  who  are  sui  juris  from  making  their  own  contracts." 
In  other  words,   it  assumed   that   incapacities   not  known   to  the 
common  law  could  not  be  recognized  by  the  legislature,  and  ignored 
the  palpable  fact  that  courts  of  chancery  had  wielded  a  not  mcon- 
siderable  power  of  interference  with  freedom  of  contract.   In  the 

^Matter  of  Jacobs,  98  N.Y.  98;  People  v.  Marx,  99  N.Y  377- 
2See  H  M  Field,  Life  of  David  Dudley  Field,  chaps.  1  and  u. 
aylTVPeo/ze/iio  111.  5QO  (1884).  Sheldon,  J.,  said :  "We  do  not  regard 
this  as  requiring  that  in  all  contracts  for  the  minmg  of  coal  the  wages  of  the 
miners  must  be  computed  upon  the  basis  of  the  weight  of  the  cod  imned^  That 
would  be  a  quite  arbitrary  provision  and  seemingly  an  undue  mterfe  ence  with 
men's  rights  of  making  contracts."  *ii3  Pa.  St.  427  (1886). 


LIBERTY  OF  CONTRACT 


597 


same  year  the  Supreme  Court  of  Illinois  passed  expressly  upon  the 
subject  of  its  dictum  of  two  years  before.  The  case  of  Millet  vi 
People^  turned  chiefly  upon  the  point  that  the  statute  was  restricted 
to  certain  employers  and  was  not  applicable  to  employers  generally.! 
But  the  Court  (Scholfield,  J.)  said: 

What  is  there  in  the  condition  or  situation  of  the  laborer  in  the 
mine  to  disqualify  him  from  contracting  in  regard  to  the  price  of 
his  labor  or  in  regard  to  the  mode  of  ascertaining  the  price?  And 
why  should  the  owner  of  the  mine  not  be  allowed  to  contract  in 
respect  to  such  matters  as  to  which  all  other  property  owners  and 
agents  may  contract? 

The  Court  assumes  that  this  question  answers  itself.  It  does  wt 
conceive  any  examination  necessary  in  order  to  ascertain  whether 
there  is  not  in  fact  a  difference.  It  does  not  consider  that  laborers 
in  mines  may  be  in  a  continual  condition  of  poverty,  and  that,  as 
Lord  Northington  put  it,  "Necessitous  men  are  not,  truly  speaking, 
free  men,  but,  to  answer  a  present  exigency,  will  submit  to  any 
terms  that  the  crafty  may  impose  upon  them."- 

Godcharles  v.  Wigeman  and  Millet  v.  People  soon  obtained  a  con- 
siderable following.  They  were  cited  three  years  later  in  State  v. 
Goodwill,^  holding  unconstitutional  a  statute  against  payment  of 
wages  in  mines  and  factories  in  store  orders,  and  State  v.  Fire  Creek 
Coal  and  Coke  Co.,^  deciding  against  legislation  prohibiting  mine 
and  factory  owners  from  selling  merchandise  to  their  laborers  at  a 
greater  profit  than  when  selling  to  others.  The  former  case  is  es- 
pecially interesting  because  of  its  argument  that  no  new  forms  of 
incapacity  to  contract  can  be  recognized  by  the  legislature.  Speaking 
of  usury  legislation,  the  Court  says : 

The  right  to  regulate  the  rate  of  interest  existed  at  the  time  the 
Constitution  was  adopted,  and  cannot,  therefore,  be  considered  as 
either  an  abridgment  or  restraint  upon  the  rights  of  the  citizen 
guaranteed  by  the  Constitution.  The  power  to  pass  usury  laws 
exists  by  immemorial  usage;  but  such  is  not  the  case  with  such 
acts  as  we  are  now  considering. 

In  the  decade  1890- 1899  the  current  of  decisions  following  God- 
charles V.  Wigeman  flowed  fast.     In  1890,  in  Ex  Parte  Kuback,^ 


1117  HI.  294. 

"^Vernon  v.  Bethell,  2  Eden,  no,  113. 

333  W.  Va.  179  (1889). 


433  W.  Va.  188  (1889). 
5  8s  Cal.  274. 


;  r 


598       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  Supreme  Court  of  California  held  adversely  to  a  municipal  ordi- 
nance prescribing  eight  hours  as  a  day's  work  on  public  works,  on 
the  ground  that  it  was  an  infringement  of  the  right  of  persons  "to 
make  and  enforce  their  contracts."    That  the  municipality  might 
have  some  right  to  dictate  the  terms  of  its  own  contracts  seems  not 
to  have  been  considered.    The  following  year  the  Supreme  Court  of 
Massachusetts  held  adversely  to  a  statute  prohibiting  the  imposition 
of  fines  in  cotton  mills.'    The  Court  cited  Godcharles  v.  Wigeman, 
Millet  V.  People,  and  State  v.  Goodwill ;  also  the  New  York  cases 
as  to  the  right  to  pursue  one's  calling.    It  said  that  the  statute  was 
*'an  interference  with  the  right  to  make  reasonable  and  proper  con- 
tracts in  conducting  a  legitimate  business."    But  are  the  contracts 
forbidden  "reasonable  and  proper"?    The  legislature  thought  they 
were  not.    To  the  Court  the  contrary  seemed  a  matter  of  course. 
It  was  assumed  to  be  a  matter  of  law.    Viewed  as  one  of  fact,  the 
question  assumes  a  very  different  aspect.    It  is  interesting  to  observe 
that  Mr.  Justice  Holmes  dissented.    The  Supreme  Court  of  Illinois 
followed  with  three  decisions.    In  Frorer  v.  People-  the  statute  was 
directed  against  company  stores  and  required  employees  to  be  paid 
weekly.    This  was  held  invalid,  citing  the  New  York  cases  above 
referred  to,  Godcharles  v.  Wtgeman,  the  West  Virginia  cases.  Ex 
Parte  Kuback,  and  Com.  v.  Perry.    Its  position  is  that  the  statute 
interferes  with  the  absolute  right  to  make  what  contracts  one  chooses. 
But  the  Court  recognizes  that  usury  laws  also  might  be  thought 
to  contravene  this  right,  and  it  attempts  to  distinguish  them  thus : 

Usury  laws  proceed  upon  the  theory  that  the  lender  and  the 
borrower  of  money  do  not  occupy  toward  each  other  the  same  rela- 
tions of  equality  that  parties  do  in  contracting  with  each  other  in 
regard  to  the  loan  or  sale  of  other  kinds  of  property,  and  that  the 
borrower's  necessities  deprive  him  of  freedom  in  contracting  and  place 
him  at  the  mercy  of  the  lender  and  such  laws  may  be  found  on  the 
statute  books  of  all  civilized  nations  of  the  world,  both  ancient  and 
modern. 

It  does  not  seem  to  have  occurred  to  Mr.  Justice  Scholfield  that 
the  necessities  of  a  miner  or  factory  employee  might  impair  his  free- 
dom of  contract  or  put  him  at  the  mercy  of  his  employers  in  the 

'^Com.  V.  Perry,  155  Mass.  117  (1891). 
2  141  III.  171   (1892). 


LIBERTY  OF  CONTRACT 


599 


same  way,  nor  that  labor  legislation  was  enacted  or  enacting  in  all 
modern  civilized  countries,  nor  that  England,  which  might  be  sup- 
posed to  be  a  modern  civilized  country,  had  abrogated  her  legislation 
against  usury .^  |Q^9" 

In  Ramsey  v.  People^  the  same  court  had  before  it  a  statute 
requiring  mine  operators  to  weigh  coal  on  pit  cars  before  it  was 
screened  and  to  compute  the  pay  of  the  miners  on  the  basis  of  the 
weight  of  the  unscreened  coal.  In  holding  the  law  unconstitutional 
the  Court  (per  Bailey,  J.)  said  : 

[The  statute]  attempts  to  take  from  both  employer  and  employee 
engaged  in  the  mining  business,  the  right  and  the  power  of  fixing  by 
contract  the  amount  of  wages  the  employee  is  to  receive  and  the 
mode  in  which  such  wages  are  to  be  ascertained. 

That  is,  the  Court  considered  the  basis  of  computation  of  miners* 
wages  something  that  could  only  affect  the  miner  and  the  operators 
— something  in  which  the  public  could  have  no  reasonable  concern. 
How  false  this  assumption  was,  and  how  much  more  sound  was  the 
judgment  of  the  legislature,  experience  soon  made  manifest.  Ramsey 
V.  People  was  followed  and  relied  upon  three  years  later  in  In  re 
House  Bill  203,^  in  which  the  Supreme  Court  of  Colorado  advised 
the  legislature  of  that  state  that  a  bill  providing  for  the  weighing  of 
coal  at  the  mine  in  order  to  fix  the  compensation  of  miners  was  not 
in  accord  with  the  state  nor  with  the  federal  constitution.  As  to  the 
latter  proposition,  we  know  now  that  the  Court  was  in  error.*  But 
the  assumption  that  the  public  had  no  interest  in  the  way  in  which 
miners'  wages  were  paid,  which  dictated  the  decision,  was  speedily 
refuted  by  the  ensuing  wrangles,  strikes,  and  disorders,  due  to  at- 
tempts to  secure  by  force  what  could  not  be  had  by  law.  "Working 
people  have  striven  to  obtain  by  strikes  what  they  had  failed  to 
secure  by  statute.  The  lawlessness  which  has  disgraced  Colorado, 
like  the  lawlessness  which  has  long  disgraced  Illinois,  is  traceable 
ultimately  to  the  denial  of  law  by  the  authorities  which  alone  can 
constitute  and  establish  it."^ 

^17  and  18  Vict.  C.  90. 

2142  111.  380  (1892). 

821  Col.  27  (1895). 

*McLean  v.  Arkansas,  29  Sup.  Ct.  Rep.  206. 

^Kelley,  Some  Ethical  Gains  through  Legislation,  p.  162.   See  also  p.  144. 


'I 

n 


I 


600       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  third  decision  of  the  Supreme  Court  of  Illinois  referred  to, 
Braceville  Coal  Co.  v.  People,"-  involves  the  same  questions  and 
reaches  the  same  conclusion  as  in  the  Frorer  case. 

Legislation  requiring  payment  in  money  of  wages  of  employees  in 
mines  and  factories  was  held  unconstitutional  by  the  Supreme  Court 
of  Missouri  in  State  v.  Loomis.'  The  Court,  as  usual,  cited  the  New 
York  cases,  Godcharles  v.  Wigeman,  and  Millet  v.  People.  It  in- 
sisted chiefly,  however,  that  the  statute  tried  to  create  a  new  sort 
of  incapacity.  Black,  C.  J.,  said :  "This  denial  ofjhfijjght  to  rnn- 
tract  is  based  upon  a  classification  which  is  purely  arbitrary,  because 

the  ground  of  cTassTJicafwrrTias no  relation  whatever  to  the  natuzd 

capacity  of  persons  to  contract.''^ 

WTiat  is  "natural  capacity  to  contract ^^?  Have  married  women 
naturafcapacity  to'contract  ?  The  Suprem~e  Court  of  Illinois  seemed"  to 
think  so  in  Ritchie  v.  People.^  If  so,  there  were  some  unconstitutional 
restrictions  upon  their  contractual  powers  at  common  law  which  have 
by  no  means  been  removed  entirely  in  all  jurisdictions.  If  not,  then 
it  would  appear  that  natural  capacity  means  simply  common-law 
capacity,  and  that  the  Court  means  to  tell  us  that  no  incapacities  not 
recognized  by  the  common  law  can  be  given  effect  to  by  legislation. 

Legislation  of  the  same  sort  came  before  the  Supreme  Court  of 
Arkansas  the  following  year.*  The  Court^  upheld  it,  so  far  as  con- 
tracts with  corporations  were  concerned,  upon  grounds  that  shall 
be  considered  presentry,  but  delivered  a  vigorous  dictum  to  the  effect 
that  it  was  invalid  as  to  contracts  of  individuals  with  individuals. 
This  dictum  was  afterwards  rejected  and  the  legislation  was  upheld 
for  all  purposes  in  a  later  decision.-'  The  year  1894  produced  another 
decision  upholding  liberty  of  contract  in  Low  v.  Rees  Printing  Co.," 

1147  111.  66  (1893)- 

2 115  Mo.  307  (1893)- 

3i55  111.  99  (1895). 

^Leep  V.  Railwav  Co.,  58  Ark.  407  (1894)- 

5 McLean  v.  Stale,  81  Ark.  304.  The  dictum  in  the  former  case  repeated  the 
doctrine  of  the  Illinois  cases,  the  Court  saying  that  a  contract  with  respect  to 
wages  between  individual  and  individual  "  is  necessarily  harmless,  of  purely  and 
exclusively  private  concern,  and  camwt  affect  anyone  except  the  parties.''  Since 
the  coal  miners'  strike  of  1901  courts  have  not  been  so  sure  of  this. 

'■•41  Neb.  127.  A  decision  of  an  inferior  court  during  1894  may  be  noted 
here.  In  Wheeling  Bridge  &  Terminal  Co.  v.  Gilmore,  8  Ohio  Cir.  Ct.  658, 
the  Court  held  adversely  to  a  statute  requiring  extra  compensation  for  all  labor 
over  ten  hours  a  day  upon  railroads. 


LIBERTY  OF  CONTRACT 


601 


'n 


\ 


in  which  a  general  eight-hour  law  for  all  except  farm  laborers  was 
held  unconstitutional. 

In  1895  we  meet  with  three  cases.  The  first  of  these,  State  v. 
Julow,^  decided  by  the  Supreme  Court  of  Missouri,  involved  the 
point  passed  upon  in  the  Adair  Case.  The  Court  ruled  adversely 
upon  a  statute  requiring  employers  not  to  prohibit  their  employees 
from  joining  unions  or  compel  them  to  withdraw  from  unions.  The 
second,  decided  by  the  Supreme  Court  of  Colorado,  has  been  spoken 
of  already.  The  third,  a  decision  of  the  Supreme  Court  of  Illinois, 
probably  establishes  the  high-water  mark  of  academic  individualism. 
Ritchie  v.  People^  involved  a  statute  regulating  the  hours  of  .labor 
of  women  employed  in  the  manufacture  of  clothing.  It  was  Jield 
unconstitutional,  first,  because  (the  Court  said)  the  legislature  has 
no  right  to  deprive  one~class  of  persons^of  privileges  allowed  to  other 
persons  under  like  conditions,  and,  second,  because  liberty  of  contract 
is- a  pi  upgfty"  right  and  cannot  be  taken  away.  With  respect  to  the 
first  of  these  propositions7  one  would  think  it  might  make  some 
difference  what  the  respective  classes  were.  Certainly  legislation 
does  not  allow  women  the  same  political  privileges  as  other  persons. 
Moreover,  one  would  think  the  question  whether  the  conditions  under 
which  women  are  employed  in  the  manufacture  of  clothing  are  the 
same  as  those  under  which  ordinary  contracts  are  made  deserves 
investigation.  But  to  the  Court  the  fact  that  the  jural  conditions 
were  the  same  was  enough.  On  the  second  point  the  Court  cites  the 
New  York  cases,  Godcharles  v.  Wigeman,  and  the  Goodwill,  Frorer, 
Perry,  and  Loomis  cases.  It  says  that  consequences  injurious  to  the  \ 
public  health,  welfare,  and  safety  cannot  flow  from  the  manufacture  \ 
of  clothing,  and  hence  that  such  manufacture  is  not  a  subject  of 
regulation.  But  we  may  grant  this  and  still  suggest  that  the  manner 
of  manufacture,  by  women  and  in  sweatshops,  for  instance,  may  be 
of  grave  public  concern.^ 

1129  Mo.  163. 

2155  111.99. 

3 In  the  opinion  in  this  case,  Magruder,  J.,  says:  "It  will  not  be  denied  that 
woman  is  entitled  to  the  same  rights  under  the  Constitution  to  make  contracts 
with  reference  to  her  labor  as  are  secured  thereby  to  men"  (p.  iii).  It  is  worth 
while  to  compare  this  with  what  the  same  court  said  as  to  usury  legislation  in 
Frorer  v.  People,  141  111.  171,  186.  In  the  latter  case  the  Court  said  the  legis- 
lature could  deprive  necessitous  debtors  of  their  natural  right  to  contract  to 
pay  the  highest  rate  of  interest  an  avaricious  creditor  could  extort  from  them, 


•  ^ 


\ 


'■  • 


i- 


602       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  year  1896  produced  two  dicta  in  the  same  line.  Harding  v. 
iPeople^  involved  a  statute  regulating  the  weighing  of  coal  for  the 
i  purpose  of  fixing  miners'  wages  in  all  mines  the  product  whereof  was 
shipped  by  rail  or  water.  The  Court  held  that  the  classification  of 
mines  was  unreasonable  and  the  statute  in  violation  of  the  provision 
of  the  state  constitution  prohibiting  special  laws  where  general  legis- 
lation could  be  made  to  apply.  But  Mr.  Justice  Cartwright  delivered 
a  very  confident  dictum  that  the  statute  could  not  be  upheld  for 
the  further  reason  that  "  it  takes  away  the  freedom  of  contracting  by 
the  parties  for  the  ascertainment  of  the  weight  of  coal  except  by  a 
certain  method"  (p.  467).  Possibly,  in  view  of  the  recent  decision 
of  the  Supreme  Court  of  the  United  States  in  McLean  v.  Arkansas, 
the  Court  would  not  be  so  sure  of  this  point  today.  In  Shaver  v. 
Pennsylvania  Cor  a  Circuit  Court  of  the  United  States  had  before 
it  a  statute  prohibiting  railway  employees  from  contracting  away 
their  right  to  recover  for  injuries.  Thg  statute  was  held  bad  because 
of  unreasonable  classification.  Tint  thp  Court  wa<;  akn  of  opinion 
that  it  involve3^'an"unconstitutional  interference  with  freedom  of 
contract. 

Three  cases  were  decided  in  accordance  with  the  doctrine  in  ques- 
tion in  1899.  In  Johnson  v.  Goodyear  Mining  Co.^  the  Supreme 
Court  of  California  ruled  adversely  upon  a  statute  requiring  corpora- 
tions to  pay  their  laborers  at  least  once  a  month  the  wages  earned 
during  the  preceding  month.  The  Supreme  Court  of  Colorado,  in 
In  re  Morgan,"^  had  before  it  a  statute  regulating  hours  of  employ- 
ment in  underground  mines  and  in  smelting  and  ore-reduction  works. 
The  Court  said  that  legislation  which  prohibited  an  adult  man  from 
working  or  contracting  to  work  more  than  eight  hours  a  day  in 
any  lawful  private  business  which  involved  no  injury  to  the  general 
public,  on  the  ground  that  longer  hours  of  labor  would  injure  his 

because  usury  laws  existed  when  the  Constitution  was  adopted.  Looking  at  the 
matter  in  this  way,  is  it  not  pertinent  to  inquire  whether  married  women  could 
have  made  any  contract  when  the  Constitution  was  adopted  ?  If  they  could 
not,  would  it  follow  that  legislation  could  regulate  the  labor  and  wage  contracts 
of  married  women  but  not  those  of  unmarried  women,  or  would  the  faith  of 
the  Court  in  its  distinction  be  shaken  ?  It  may  be  noted  here  conveniently  that 
there  ia  also  in  i8q5  a  decision  of  an  inferior  court  of  Pennsylvania  following 
Godcharles  v.  Wigeman  (Com.  v.  Isenberg,  8  Kulp.  116). 

1160  111.  459.  3 127  Cal.  4- 

271  Fed.  931.  *26  Col.  415. 


LIBERTY  OF  CONTRACT 


603 


health,  was  unconstitutional.  It  cited  the  views  of  the  minority  in 
the  Slaughter  House  Cases,  as  restated  in  the  Butchers'  Union  Com- 
pany Case,  the  New  York  cases,  and  the  several  cases  on  liberty  of 
contract  already  discussed,  relying  especially  on  Ritchie  v.  People. 
In  State  v.  Haun^  the  Supreme  Court  of  Kansas  held  invalid  a 
statute  requiring  wages  to  be  paid  in  money.   The  Court  said : 

While  it  might  be  desirable  and  profitable  to  the  employee  of  such 
corporation  to  receive  a  horse  or  a  cow  or  a  house  and  lot  in  payment 
for  his  wages,  yet  the  legislature  prohibits  payment  in  that  way  and 
places  the  laborer  under  guardianship,  classifying  him  in  respect  of 
freedom  of  contract  with  the  idiot,  the  lunatic,  or  the  felon  in  the 
penitentiary. 

That  it  is  neither  desirable  nor  profitable  to  the  employee  to  re- 
ceive wages  in  orders  upon  a  company  store  was  possibly  irrelevant 
to  the  purely  academic  view  of  such  legislation.  But  surely  the 
Court  might  have  said  that  the  legislation  classed  the  laborer  in 
mines  with  the  sailor,  over  whose  contracts  courts  of  equity  exer- 
cise a  jealous  supervision,  or  a  necessitous  borrower,  whom  equity 
will  not  suffer  to  clog  his  equity  of  redemption  by  any  sort  of 
collateral  provisions,  however  much  his  necessities  and  the  exac- 
tions of  the  lender  may  persuade  him  they  are  desirable  or  profit- 
able. No  one  ever  supposed  that  equity  classed  sailor  or  borrower 
with  idiots,  lunatics,  or  felons. 

The  next  year,  1900,  the  Supreme  Court  of  Illinois  had  before  it 
a  statute  against  prohibiting  employees  from  joining  or  remaining 
in  unions.  The  Court,  following  the  Julow  case,  held  it  an  uncon- 
stitutional interference  with  liberty  of  contract.^  Magruder,  J.,  said 
that  the  employer  had  a  "right"  to  terminate  the  contract  of  em- 
ployment for  any  reason  he  chose,  subject  to  liability  for  damages 
if  his  act  was  unwarranted.  But  damages  are  awarded  as  compensa- 
tion for  wrongs.  How  can  we  say  that  one  must  respond  in  damages 
for  the  exercise  of  a  sacred  right,  protected  by  the  Constitution  and 
beyond  the  reach  of  legislation  ?  The  Julow  and  Gillespie  cases  have 
been  followed  in  all  the  subsequent  decisions.^ 

^61  Kan.  146. 

^Gillespie  v.  People,  188  111.  176. 

^ State  v.  Kreutzberg,  114  Wis.  530  (1902) ;  Coffeyville  Vitrified  Brick  &  Tile 
Co.  v.  Perry,  69  Kan.  297  (1904) ;  People  v.  Marcus,  185  N.  Y.  257  (1906). 


I 


I 


604       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

After  1900  the  pendulum  had  clearly  begun  to  swing  the  other 
way.  But  there  are  a  number  of  striking  decisions  taking  extreme 
views  as  to  liberty  of  contract  prior  to  the  Adair  Case.  The  most 
extreme  is  People  v.  Co/cr,^  in  which  the  Court  of  Appeals  of  New 
York  passed  adversely  upon  legislation  with  reference  to  hours  of 
labor  an3"wages  In 'municipal  contracts.  The  opinion  of  0T3rien,  J., 
in  this  easels  a  vigorous  discussion  of  the  economic  and  political 
objections  to  labor  legislation  from  the  individualist  standpoint,  in- 
sisting that  such  legislation  is  of  no  real  benefit  to  the  laborer  and 
is  subversive  l)f  hir  natural  rights.  Perhaps  the  most  interesting 
point  made  in  the  opinion  is  a  suggestion  that  the  statute  invades  a 
constitutional  right  of  the  contractor  tT'malie  freely  whatever  con- 
tract he  can  with  the  city.  This  overriding  of  the  publicjflteicst  in 
municipal  contracts  in  the  interest  of  the  private  contractor  with 
the  municipality  goes  beyond  any  other  recorded"  judicial  ntter- 
ance.  It  can  be  compared  only  with  Blackstone's  dictum  that  the 
public  goodTs  m  nothing  mbre  esseiTtTaTTy  interested  than  in  the  pro- 
tection of  every  individuaFs  private  rights.  In  Mathews  v.  People- 
the  statute7  providing  a  state  employment  bureau,  prescribed  that 
the  bureau  should  not  furnish  a  list  of  unemployed  laborers  to  any 
employer  whose  workmen  were  on  a  strike.  This  was  held  bad  on 
other  grounds,  but  the  Court  (per  Magruder,  J.)  declared  that  it 
infringed  the  liberty  of  contract  guaranteed  by  the  Constitution.^ 
In  State  v.  Varney  Electrical  Supply  Co}  the  Coler  case  was  followed 
by  the  Supreme  Court  of  Indiana.  In  State  v.  Missouri  Tie  &  Tim- 
ber Co:'  the  Supreme  Court  of  Missouri  held  that  a  statute  requiring 
employees  to  be  paid  in  cash  or  negotiable  instruments  was  an 
unreasonable  interference  with  the  liberty  of  contract  of  adult  em- 
ployees. In  Lochner  v.  New  York""  a  bare  majority  of  the  Supreme 
Court  of  the  United  States  took  the  reactionary  view,  as  it  had 

1166  N.Y.  I  (looi). 

2202  111.  389  (1903). 

3 Possibly  more  might  be  said  for  this  statute  than  the  Court  assumed.  In 
view  of  the  disorders  and  breaches  of  the  peace  which  experience  had  shown 
attend  labor  conflicts,  it  might  be  urged  that  the  purpose  of  the  proviso  was 
to  preserve  the  public  peace.  A  provision  that  the  state  employment  agency 
should  be  used  to  provide  ordinary  employment,  but  not  employment  to  break 
strikes,  has  some  arguable  basis  in  reason  when  we  look  to  the  actual  facts. 

*  160  Ind.  338  (1903). 

5  181  Mo.  536  (1904).  "198  U.S.  45  (1905). 


LIBERTY  OF  CONTRACT 


605 


fairly  become  by  this  time,  of  a  statute  prescribing  the  hours  of 
labor  in  bakeries.  The  view  of  the  majority  in  this  case,  as  usual, 
goes  back  to  the  restatement  in  the  Butchers'  Union  Company  Case 
of  the  views  of  the  minority  in  the  Slaughter  House  Cases.  Mr.  Jus- 
tice Peckham  cites  his  own  definition  of  liberty  in  Allgeyer  v.  Louis- 
ianay^  and  that  definition  is  admittedly  based  upon  the  views  of  Mr. 
Justice  Field  and  Mr.  Justice  Bradley  in  the  cases  referred  to.  In  the 
Allgeyer  Case  he  had  said : 

The  liberty  mentioned  in  that  amendment  means  not  only  the 
right  of  the  citizen  to  be  free  from  the  mere  physical  restraint  of  his 
person,  as  by  incarceration ;  but  the  term  is  deemed  to  embrace  the 
right  of  the  citizen  to  be  free  in  the  enjoyment  of  all  his  faculties ;  to 
be  free  to  use  them  in  all  lawful  ways ;  to  live  and  work  where  he 
will ;  to  earn  his  livelihood  by  any  lawful  calling ;  to  pursue  any 
livelihood  or  avocation,  and  for  that  purpose  to  enter  into  all  con- 
tracts which  may  be  proper,  necessary  and  essential  to  his  carrying 
out  to  a  successful  conclusion  the  purposes  above  mentioned. 

One  may  grant  this  definition  and  yet  deny  the  consequence  which 
Mr.  Justice  Peckham  derived  from  it  in  the  Lochner  case.  His 
position  was,  in  effect,  that  a  baker  had  a  constitutional  right  to 
contract  to  work  as  long  as  he  pleased.    He  says  (p.  57): 

There  is  no  contention  that  bakers  as  a  class  are  not  equal  in 
intelligence  and  capacity  to  men  in  other  trades  or  manual  occupa- 
tions, or  that  they  are  not  able  to  assert  their  rights  and  care  for 
themselves  without  the  protecting  arm  of  the  State  interfering  with 
their  independence  of  judgment  and  of  action.  They  are  in  no  sense 
wards  of  the  State.  Viewed  in  the  light  of  a  purely  labor  law,  with 
no  reference  whatever  to  the  question  of  health,  we  think  that  a  law 
like  the  one  before  us  involves  neither  the  safety,  the  morals  nor  the 
welfare  of  the  public,  and  that  the  interest  of  the  public  is  not  in  the 
slightest  degree  affected  by  such  an  act.  The  law  must  be  upheld,  if 
at  all,  as  a  law  pertaining  to  the  health  of  the  individual  engaged 
in  the  occupation  of  a  baker.  It  does  not  affect  any  other  portion  of 
the  public  than  those  who  are  engaged  in  that  occupation.  Clean  and 
wholesome  bread  does  not  depend  upon  whether  the  baker  works  but 
ten  hours  per  day  or  only  sixty  hours  a  week. 

It  will  be  seen  that  this  opinion  assumes  two  propositions  of  fact : 
( I )  that  the  public  has  no  concern  in  how  long  a  baker  works,  be- 
cause the  time  he  works  has  no  effect  on  the  product  of  his  labor ; 

116S  U.S.  578. 


'I 


ii*' 


I 


!ft 


606       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

(2)  that  there  is  nothing  in  the  trade  of  baking,  as  carried  on  in 
large  cities,  inimical  to  the  health  of  those  who  are  employed  in  it 
for  long  hours  at  a  stretch.  Here  again  study  of  the  facts  has  shown 
that  the  legislature  was  right  and  the  Court  was  wrong.  Actual  inves- 
tigation has  shown  that  the  output  of  shops  in  which  the  only  kind 
of  men  who  can  be  had  to  work  for  unreasonable  hours  under  unsani- 
tary conditions  are  employed  is  not  at  all  what  the  public  ought  to 
eat,  and  that  long  hours  in  shops  of  the  sort  are  distinctly  injurious 
to  health.^  But  the  decisive  objection  to  the  position  of  the  majority 
is  put  by  Mr.  Justice  Holmes  in  a  few  sentences  that  deserve  to  be- 
come classical : 

This  case  is  decided  upon  an  economic  theory  which  a  large  part 
of  the  country  does  not  entertain.  If  it  were  a  question  whether  I 
agreed  with  that  theory,  I  should  desire  to  study  it  further  and  long 
before  making  up  my  mind.  But  I  do  not  conceive  that  to  be  my 
duty,  because  I  strongly  believe  that  my  agreement  or  disagreement 
has  nothing  to  do  with  the  right  of  a  majority  to  embody  their 
opinions  in  law.  .  .  .  The  Fourteenth  Amendment  does  not  enact 
Mr.  Herbert  Spencer's  ^"^  Social  Statics^  ,  .  .  A  constitution  is  not 
intended  to  embody  a  particular  economic  theory,  whether  of  pater- 
nalism and  the  organic  relation  of  the  citizen  to  the  State  or  of 
laissez  faire.  It  is  made  for  people  of  fundamentally  differing  views, 
and  the  accident  of  our  finding  certain  opinions  natural  and  familiar 
or  novel  and  even  shocking  ought  not  to  conclude  our  judgment  upon 
the  question  whether  statutes  embodying  them  conflict  with  the 
Constitution  of  the  United  States  (pp.  75-76). 

Finally,  we  have  two  cases — one  in  the  Court  of  Appeals  of  New 
York^  and  the  other,  the  Adair  Case,  in  the  Supreme  Court  of  the 
United  States^ — in  which  the  doctrine  of  the  Julow  case  is  adopted, 
and  legislation  to  prevent  _£niployers  frQiii-4M:Qbibiting  employees 
fj:Qnijoining  or  requiring  them  to  withdraw  from  labor  unions  is  held 


^City  Club  Bulletin,  Chicago,  Vol.  II,  No.  25  (February  24,  1909).  See  also 
the  authorities  cited  in  the  dissenting  opinion  of  Harlan,  J.,  pp.  70-71.  Sir 
Frederick  Pollock  makes  this  very  pertinent  comment :  "  How  can  the  Supreme 
Court  at  Washington  have  conclusive  judicial  knowledge  of  the  conditions  affect- 
ing bakeries  in  New  York  ?  If  it  has  not  such  knowledge  as  matter  of  fact,  can 
it  be  matter  of  law  that  no  conditions  can  reasonably  be  supposed  to  exist 
which  would  make  such  an  enactment  .  .  .  constitutional  ?  {Law  Quarterly 
Review,  Vol.  XXI,  p.  212). 

-People  V.  Marcus  185  N.  Y.  257  (1906). 

3  208  U.S.  161  (1908). 


LIBERTY  OF  CONTRACT 


607 


unconstitutional,  as  infringing  libertv  of  contract.    In  the  former 
case  the  Court  puts  the  matter  thus : 

The  free  and  untrammeled  right  to  contract  is  part  of  the  liberty 
guaranteed  to  every  citizen  by  the  federal  and  state  constitutions. 
Personal  liberty  is  always  subject  to  restraint  when  its  exercise  affects 
the  safety,  health  or  moral  and  general  welfare  of  the  public,  but 
subject  to  such  restraint  an  employer  and  employee  may  make  and 
enforce   such   contract  relating   to  labor   as   they   may   agree  on 

(p. 25s). 

In  other  words,  the  public  have  no  interest  in  bringing  about  a 
real  equality  in  labor  bargainings,  even  though  thereby  strikes  and 
disorders  may  be  obviated,  and  have  no  concern  with  contracts  for 
labor  except  where  the  safety,  health,  or  morals  of  the  public  at  large 
may  be  concerned !  This  is  practically  the  position  from  which  we 
found  the  courts  starting  twenty  years  before. 

Summing  up  the  decisions  which  insist  upon  the  inviolability  of 
freedom  of  contract,  we  find  that  the  following  propositions  have  been 
decided:  (i)  I^egislation  forbidding  employers  from  interfering 
with  the  membership  of  their  employees  inlabor  umonsls  invalid.  ~ 
All  the  courts  have  reached  this  conclusion.  (2)  Legistation  prohibit- 
ing the  imposition  of  fines  upon  employees  is  invalid.  Only  one 
court,  however,  has  passed  upon  this  subject.  (3)  Legislation  pro- 
vidingfor  the  niode  of  weighing  coal  in  order  to  fix  the  compensation 
of  minersjs_held.iiivalid  in  Illinois,  Missouri,  Colorado,  and  Kansas, 
and  in  WestVirginia  where  the  parties  are  natural  persons.  But  the 
Suprieme  Court  of  the  United  States  now  holds  to  the  contrary. 
(4)  legislation  against  company  stores,  requiring  emplcTyers  to  pay 
wages  m  money,  is  held  iflValid  in  Tennsylvania,  Illinois,  Missouri, 
Kansas,  Colorado,  and  California,  and  in  West  Virginia  as  to  con- 
tracts with  natural  persons.  But,  as  we  shall  see  presently,  many 
states  and  the  U^ted  States  Supreme  Court  take  the  contrary 
position  on  one  ground  oranotherT  (sy  Legislation  as  to  the  hours  of 
labor^asHbeen  held  Dad  (apwKere  labor  of  adult  males  is  concerned 
(unless  very  clearly  ot'  a  dangerous  of  unHeaTthy  character),  in 
Nebraska  and  by  the  United  States  Supreme  Court;  (b)  where 
labor  of  adult  females  is  regulated,  in  Illinois — but  most  of  the 
state  courts  and  the  United  States  Suj>mne.  Coilil-iiold  Jjd.  the  .£^ 
trary ;  (c)  wl^ere  the  lours"Q!  labor  on  public  or  municipal  contracts 


i 


\/wy 


6o8       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


4 


i 


liil'tt 


are  regulated,  in  California,  New  York,  and  Indiana.  But  here, 
again,  many  state  courts  and  the  federal  Supreme  Court  are  opposed. 
(6)  Oiie  court  hasursdlield  that  legislation  cannot  prohibit  contracts 
by  railway  empTbyiees  foiH^easlng  their  employers  in  advance  from 
liaETlity  for  personal  injuries.  Feder^t~tPgt5tanon  has  probably  de- 
priWCTTllTs  quesfton  of  all  practical  interest. 

Some  of  the  statutes  passed  upon  in  the  foregoing  cases  may 
have  gone  too  far.  Some  of  them  involved  bad  or  careless  classi- 
fications. Some  of  them  ran  counter  to  local  constitutional  pro- 
visions, requiring  general  laws  wherever  possible.  But  one  cannot 
read  the  cases  in  detail  without  feeling  that  ttie  ^reat  majority 
of  the  decisions  are  simply  wrong,  not  only  in  constitutional  law 
but  from  the  standpumt  ot  The  common  law,  and  even  from  that 
of  a  sane  individualism.  Looking  at  them  upon  common-law  prin- 
ciples we  must  first  of  all_  recognize  that  there  never  has  been  at 
common  law  any.  such_Jreedom  of  contract  as  they  postulate. 
From  the  time  that  promises  not  under  seal  have  been  enforced  at 
all,  equity  has  interfered  with  contracts  in  the  interests  of  weak, 
necessitous,  or  unfortunate  promisors.  One  of  the  earliest  cases  of 
equitable  interference  was  to  prevent  forfeitures  to  which  promisors 
had  agreed  solemnly  under  seal.  Not  only  did  equity  grant  to  a 
debtor  a  right  of  redemption  for  which  he  did  not  stipulate,  but  it 
would  not  and  will  not  let  him  contract  it  away  in  advance  or 
"clog"  it  by  a  collateral  agreement  that  will  operate  to  prevent  a 
redemption.^  In  like  manner  Q^uity  interfered  to  set  aside  con- 
tracts of  sailors  for  the  disposition  oT  their  wages  or  of  prize  money 
due  them  where  they  appeared  unfair,  one-sided,  or  inequi table. ' 
It  interfered  also  with  contracts  of  heirs  or  reversioners  in  case  of 
inadequacy  of  consideration,  on  the  theory  that  they  were  peculiarly 
liable  to  be  imposfidj^n^anisubjia  to  the"  danger  of  ^'■sacrificing  their 

1  "A  man  will  not  be  suffered  in  conscience  to  fetter  himself  with  a  limitation  or 
restriction  of  his  right  of  redemption"  (Lord  Keeper  Henley  in  Spurgeon  v.  Col- 
lier, I  Eden,  56,  59).  "I  take  it  to  be  an  established  rule  that  the  mortgagee 
can  never  provide  at  the  time  of  making  the  loan  for  any  event  or  condition  on 
which  the  equity  of  redemption  shall  be  discharged  and  the  conveyance  abso- 
lute" (Lord  Northington  in  Vernon  v.  Bethell,  2  Eden,  no,  113).  See  Rice  v. 
Noakes,  2  Ch.  445  (iqoo)  ;  Jarrah  Timber  etc.  Corporation  v.  Samuel,  2  Ch.  i 
(1903). 

-How  V.  Weldon,  2  Ves.  Sr.  516,  518;  Taylour  v.  Rochjord,  2  Ves.  Sr.  281. 
Legislation  in  America  has  carried  this  even  further. 


\t 


LIBERTY  OF  CONTRACT 


609 


future  interests  in  order  tojiieet  tht^ir  pre?;pnt  wants." ^  It  refused 
and  refuses  to  grant  Specific  performance  of  hard  bargains,  simply 
because  they  are  hard,  leaving  promisees  to  confessedly  inadequate 
and  nugatory  actions  for  damages.  But  there  are  no  "natural 
incapacities"  here!  Courts  of  equity  have  sirn^ly _ regp^;aigfid. Ihe 
facts  of  human  intercourse,  and  have  not  suffered  jural  notions 
of  equality  to  blind  them  thereto.  Again,  Lord  Holt  laid  it  down 
that  the  two  sides  of  a  bilateral  contract  were  independent,  because 
if  a  promisor  was  foolish  enough  to  make  his  promise  independent 
in  form  it  was  his  own  fault.-  But  here  too  equity  made  an  inroad 
upon  common-law  individualism,  and  on  equitable  grounds  condi- 
tions are  now  said  to  be  implied  in  law.  It  has  been  said  that  the 
common  law  will  not  help  a  fool.  But  equity  exists  to  help  and 
protect  him.  It  is  because  there  are  fools  to  be  defrauded  and 
imposed  upon  and  unfortunates  to  meet  with  accidents  and  careless 
people  to  make  mistakes  that  we  have  courts  of  equity.  Surely_what 
equity  has  done  to  abridge  _freedpin_fli.-xuMitiac.t,  legislation  jnay 
do  likewise. 

Moreover,  usury  laws,  despite  all  that  has  been  said  to  the 
contrary,  furnish  a  perfect  analogy.  I  have  spoken  already  of  the 
proposition  that  usury  laws  existed  prior  to  our  constitutions.  A  more 
ingenious  proposition  was  advanced  by  Mr.  Justice  Field  in  Munn  v. 
Illinois^  and  is  adopted  by  the  Court  in  State  v.  Goodwill*  He 
said  that  originally  no  interest  at  all  could  be  taken ;  that  legisla- 
tion created  the  right,  and  that  usury  laws  were  not  a  limitation  of 
an  undoubted  right  but  rather  a  bound  put  to  a  privilege  the  legisla- 
ture had  conceded.  But  the  obvious  answer  to  this  is  that  enforcing 
a  promise  not  under  seal  is  also  a  late,  law-granted  privilege.  The 
same  historical  argument  that  is  relied  on  to  dispose  of  the  analogy 
of  usury  overthrows  the  whole  doctrine  of  freedom  of  contract.  The 
public  interest  in  labor  legislation  today  is  much  more  real  than  its 
interest  in  U3ury  laws.    But  the  two  are  of  the  same  type. 

Rightly  considered,  even  individualist  and  natural-law  principles 
lead  to  the  same  conclusion.    The  authorities  are  agreed  upon  the 


'^Earl  oj  Chesterfield  v.  Janssen,  2  Ves.  Sr.  125;  McClure  v.  Raben,  125 
Ind,  139, 

2  Thorpe  v.  Thorpe,  12  Mod.  455,  464. 

394  U.S.  113.  433  VV.Va.  179, 186. 


h 


6iO       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

"naturar^  invalidit^t^of  a  contract  to  becomea  slave.^  But,  as 
Sidgwick  points  out,  any  "serious  approximation  to  the  condition 
of  slavery"  comes  to  the  same  thing.^  Mill,  much  more  liberal  than 
his  followers,  admits  this,  saying : 

Not  only  persons  are  not  held  to  engagements  which  violate  the 
rights  of  third  parties,  but  it  is  sometimes  considered  a  sufficient 
reason  for  releasing  them  from  an  engagement  that  it  is  injurious 
to  themselves. 

Some  of  the  writers  on  natural  law  had  argued  that  there  were 
cases  where  natural  law  justified  sale  of  oneself  into  slavery.  To 
this  Mill  says:  "He  therefore  defeats,  in  his  own  case,  the  very 
purpose  which  is  the  justification  of  allowing  him  to  dispose  of 

himself."'^ 

The  principle  of  this  applies  to  any  situation  where  a  person  by 
contract  imposes  substantial  restraints  upon  his  liberty.  Freedom 
to  impose  these  restraints,  in  the  hands  of  the  weak  and  necessitous, 
defeats  the  very  end  of  liberty.*  Liberty  and  equality  in  fact  make 
for  a  rational  individualism.    Academic  individualism  defeats  itself. 

Let  us  turn  now  to  the  other  side,  as  represented  in  the  decisions. 
It  is  a  saving  characteristic  of  Anglo-American  case  law  that  deci- 
sions upon  an  unsound  principle  are  gradually  surrounded  by  a  mass 
of  exceptions,  distinctions,  and  limitations  which  preclude  extension 
for  the  future  and  soon  enable  the  current  of  judicial  decision  to 
fiow  normally.  Just  as  in  the  natural  body  foreign  substances  are 
encysted  and  walled  in  and  thus  deprived  of  power  for  evil,  the  body 
of  our  case  law  has  the  faculty  of  encysting  and  walling  in  rules  and 
doctrines  at  variance  with  a  sound  condition  of  the  law.  Such  a 
process  has  long  been  going  on  with  respect  to  extreme  doctrines  of 
liberty  of  contract.  As  a  result  we  may  now  recognize  six  categories 
of  cases  in  which  it  has  been  laid^~3ovv"n  ffiat  labor  legislation  may 
interfere  with  and  infringe  upon  liberty  of  contract.  The  first  of 
these  is  the  case  of  corporations.    Under  the  power  to  amend  the 

i"The  principle  of  freedom  cannot  require  that  he  should  be  free  not  to 
be  free.  It  is  not  freedom  to  be  allowed  to  alienate  his  freedom^'  (Spencer, 
Justice,  sect.  70)  ;  Mill,  Liberty,  chap.  v. 

-'Elements  of  Politics,  2d  ed.,  p.  93. 

3  Liberty,  chap.  v. 

*See  a  case  in  point  in  Dicey,  Law  and  Public  Opinion  in  England,  pp.  264- 
265. 


LIBERTY  OF  CONTRACT 


611 


charters  of  corporations,  which  all  states  now  reserve,  it  is  held  that 
the  state  may  define  the  power  of  corporations  to  contract,  and  that 
Tratural  poiaoiis  Cilli  have  no  claim  of  right  to  contract  with  these 
creatures  of  the  Stalc^eyond  their  powers.  This  doctrine,  as  applied 
to  laBoFlci^Islatlon,  originated  in  Maryland  in  1880.^  It  has  been 
followed  in  Rhode  Island,^  West  Virginia,^  Arkansas,*  Tennessee,^ 
and  the  Supreme  Court  of  the  United  States.^  It  was  adopted  by  an 
appellate  court  in  Kansas,^  but  rejected  by  the  Supreme  Court.^ 
It  has  been  rejected  also  in,  California,^  Illinois,^^  and  Missouri.^^ 
Second,  it  has  been  held  that  even  if  wages  themselves  may  not„be 
regulated,  the  data  from  which  to  fix  wages  by  any  contract  to  be 
entered  into  ^lav  be  regulated  in  order  to  prevent  fraud.^-  But  the 
decisions  noted  above  as  to  weighing  statutes  are  to  the  contrary. 
Third,  it  is  held  that  hours  and  conditions  of  labor  in  unhealthy 
occu£ations^_such  as  mining,  work  in  smelters,  and  the  like,  may  be 
regulated.^^  But  just  how  unhealthy  the  occupation  must  be  so  that 
the  court  will  know  it  to  be  such  from  its  general  information  the 
Lochner  case  leaves  in  doubt.  Fourth,  theoyerwhelimiig  weight  of 
authority  is  to  the  effect  that  the  legislaturejmay  regulatje  the  hours 
and  conditions  of  labor  of  women  and  children.^*  Here  it  is  said  there 
are  "natural"  incapacities.    But  Illinois  holds  to  the  contrary  as  to 

"^  Shaffer  v.  Mining  Co.,  55  Md.  74. 

^State  V.  Brown  &  Sharpe  Mfg.  Co.,  18  R.I.  16  (1892). 

^State  V.  Peel  Splint  Coal  Co.,  36  W.  Va.  802   (1892). 

^Leep  V.  Railway  Co.,  58  Ark.  507  (1894);  Railway  Company  v.  Paul,  64 
Ark.  83  (1897). 

^Dugger  V.  Insurance  Co.,  95  Tenn.  245  (1895). 

^Railway  Company  v.  Paul,  173  U.S.  404  (1899). 

''State  V.  Hatin,  7  Kan.  App.  509. 

^State  V.  Haun,  61  Kan.  146. 

^Johnson  v.  Goodyear  Mining  Co.,  127  Cal.  4. 

'^^ Braceville  Coal  Co.  v.  People,  147  111,  66. 

^^ State  V.  Missouri  Tie  &  Timber  Co.,  181  Mo.  536. 

^^State  V.  Wilson,  61  Kan.  32  (1889);  McLean  v.  Arkansas,  29  Sup.  Ct. 
Rep.   206    (1908), 

^^Holden  v.  Hardy,  169  U.S.  366  (1898) ;  In  re  Boyce,  27  Nev.  299  (1904)  ; 
Ex  Parte  Kair,  28  Nev.  127,  425  (1905). 

'^^Com.  V.  Hamilton  Mfg.  Co.,  120  Mass.  383  (1876) ;  Beyman  v.  Cleveland, 
39  Ohio  St.  651  (1884) ;  State  v.  Buchanan,  29  Wash.  602  (1902)  ;  Wenham  v. 
State,  65  Neb.  394  (1902)  ;  State  v.  Muller,  48  Ore.  252  (1906)  ;  State  v.  Shorey, 
48  Ore.  396  (1906)  ;  Muller  v.  Oregon^  208  U.S.  412;  Starnes  v.  Allison  Mfg. 
Co.,  61  S.  E.  525  (N.  C.  1908). 


■i 


% 


\ 


6i2       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

contracts  of  adult  women.^  Fifth,  it  has  been  held  to  be  within  the 
power  of  the  state  to  prescribe  the  conditions  upon  which  it  will 
permit  public  work  to  be  done  for  itself  or  its  municipalities,  and 
h^ce  to  regulate  wages  and  hours  on  public  contracts."  But  Cali- 
fornia, New^York,  and  Indiana,  as  has  been  seen,  hold  the  contrary. 
Finally,  a  number  of  cases  have  taken  the  sound  position  that  the 
wo3rorpa>'mcnt  of  laborers  is  a  matter  of  public  concern ;  that  it 
is  competent  for  the  legislature  to  require  that  theybe  paid  in 
money  or  negotiable  paper,  and  that  it  is  competent  to  require  that 
they  be  paid  promptly  at  stated  intervals."  Several  of  these  cases 
reject  the  distinction  between  corporations  and  natural  persons  in 
this  connection.^  But,  what  is  worth  more,  a  number  clearly  recognize 
the  actual  facts  of  inequality  as  between  employer  and  employee  in 
bargaining  for  labor  in  many  sorts  of  employment.'  And  in  Hancock 
V.  Yaden  Elliott,  J.,  makes  it  clear  from  abundant  examples  that 
limitations  upon  freedom  of  contract  in  the  interest  of  individual 
contracting  parties  have  always  existed.  It  is  unfortunate  that  the 
sweeping  assertions  of  Godcharles  v.  Wigeman  should  have  been 
made  the  model  for  subsequent  cases  with  this  decision  at  hand 

in  the  books. 

What^  then,  is  the  hope  for  future  labor  legislation?  On  the 
whole,  one  must  say  that  it  is  bright.  Not  only  do  the  cases  last 
iTOTed"afford  'many  means  for  escape  from  the  line  of  decisions  first 
considered  but  there  are  indications  that  the  courts  are  ready  to 
seek  such  escape.  The  opinion  of  Mr.  Justice  Day  in  McLean  v. 
Arkansas  especially  is  fraught  with  promise  of  a  return  on  the 
part  of  the  federal  Supreme  Court  to  its  sounder  views  prior  to 


'^Ritchie  v.  People,  155  111.  90. 

2f/.5.  V.  Martin,  94  U.S.  400  (1876);  State  v.  Atkin,  64  Kan.  7  (1901); 
Atkin  V.  Kansas,  191  U.S.  207  (1903)  ;  /«  re  Broad,  36  Wash.  449  (1904). 

^Hancock  v.  Yaden,  121  Ind.  366  (1889) ;  Opinion  of  the  Justices,  163  Mass. 
589  (189s);  Harbison  v.  Knowille  Iron  Co.,  103  Tenn.  421  (1899);  Dayton 
Coal  &  Iron  Co.  v.  Barton,  103  Tenn.  604  (1899)  ;  Knowille  Coal  &  Iron  Co. 
V.  Harbison,  183  U.S.  13   (1901);  International  Text  Book  Co.  v.  Weissinger, 

160  Ind.  349  (1902). 

-^Opinion  of  Justices,  163  Mass.  589;  Harbison  v.  Knoxville  Iron  Co.,  103 

Tenn.  421. 

5 Notably    International    Text    Book    Co.    v.    Weissinger    and    McLean    v. 

Arkansas. 


LIBERTY  OF  CONTRACT 


613 


the  Lochner  and  Adair  cases.    Even  the  Court  of  Appeals  of  New 
York  has  recently  approved  this  significant  remark : 

Under  a  judicial  system  which  has  for  centuries  magnified  the 
sacredness  of  individual  rights,  there  is  much  less  danger  of  doing 
injustice  to  the  individual  than  there  is  in  overlooking  the  obligations 
of  those  in  authority  to  organized  society.^ 

Possibly  the  decisions  first  considered,  or  some  of  them,  were  not 
without  good  effect.  Doubtless  much  of  the  earlier  legislation  was 
crude  and  some  of  it  was  premature.  But,  on  the  other  hand,  those 
decisions  wrought  an  injury  to  the  courts  and  to  the  public  regard 
for  law,  and  for  constitutional  law  in  particular,  far  beyond  any  such 
incidental  good.    An  acute  and  well-informed  observer  said  recently : 

From  my  own  experience  I  should  say,  perhaps,  that  the  one 
symptom  among  workingmen  which  most  definitely  indicates  a  class 
feeling  is  a  growing  distrust  of  the  integrity  of  the  courts— the 
belief  that  the  present  judge  has  been  a  corporation  attorney,  that 
his  sympathies  and  experience  and  his  whole  view  of  life  is  on  the 
corporation  side.^ 

The  attitude  of  many  of  our  courts  on  the  subject  of  liberty  of 
contract  is  so  certain  to  be  misapprehended,  is  so  out  of  the  range 
of  ordinary  understanding,  the  decisions  themselves  are  so  academic 
and  so  artificial  in  their  reasoning,  that  they  cannot  fail  to  engen- 
der such  feelings.  Thus  those  decisions  do  an  injury  beyond  the 
failure  of  a  few  acts.  These  acts  can  be  replaced  as  legislatures 
learn  how  to  comply  with  the  letter  of  the  decisions  and  to  evade 
the  spirit  of  them.  But  the  lost  respect  for  courts  and  law  cannot 
be  replaced.  The  evil  of  those  cases  will  live  after  them  in  impaired 
authority  of   the  courts   long   after   the   decisions   themselves   are 

forgotten. 

RoscoE  Pound 

Harvard  Law  School 


1  Werner,  J.,  in  People  v.  Strollo,  191  N.  Y.  42,  69. 

2  Jane  Addams  in  American  Journal  of  Sociology,  Vol.  XIII,  p.  772. 


HOURS  OF  LABOR 


6iS 


I- 1  *» 


•I 


T 


XXXVIII 

HOURS  OF  LABOR  AND  REALISM  IN 
CONSTITUTIONAL  LAW^ 

HE  Massachusetts  Supreme  Court  was  called  upon  recently  to 
consider  the  constitutionality  of  the  following  statute: 

Employees  in  and  about  steam  railroad  stations  in  this  Common- 
wealth designated  as  baggage  men,  laborers,  crossing  tenders,  and  the 
like,  shall  not  be  employed  for  more  than  nine  working  hours  in  ten 
hours'  time ;  the  additional  hour  to  be  allowed  as  a  lay  off. 

The  increasing  demand  for  shorter  hours  of  labor  throughout  the  in- 
dustrial world,  the  likelihood  that  such  demand  will  receive  legisla- 
tive recognition,  the  nation-wide  importance  of  the  attitude  of  the 
judiciary  toward  such  legislation ;  conversely,  the  attitude  of  public 
opinion  upon  the  continued  exercise  by  the  courts  of  their  traditional 
power  under  the  American  constitutional  system, — all  these  consid- 
erations, and  more,  justify  a  constant  critique  within  the  profession 
of  the  point  of  view,  no  less  than  the  explicit  factors,  which  control 
judicial  decisions  upon  social  and  industrial  legislation.^ 

The  question  before  the  Massachusetts  Supreme  Court  was  not  a 
new  question.  Necessarily,  therefore,  the  Court  had  to  consider  the 
applicable  precedents,  and  the  legal  thinking  which  was  embodied 
therein.^  What,  then,  was  the  legal  background  ?  It  will  be  serviceable, 

iprom  Harvard  Law  Review,  Vol.  XXIX  (1916),  pp.  353-373. 

2  Valuable  contributions  have  been  made  in  recent  years  which  will  be  re- 
ferred to  later,  particularly  the  admirable  papers  of  Professor  Ernst  Freund, 
"Limitation  of  Hours  of  Labor  and  the  Federal  Supreme  Court,"  Green  Bag, 
Vol.  XVII,  p.  411 ;  Judge  Learned  Hand,  "Due  Process  of  Law  and  the  Eight- 
Hour  Day,"  Harvard  Law  Review,  Vol.  XXI,  p.  4Q5 ;  and  Professor  Roscoe 
Pound,  "  Liberty  of  Contract,"  Yale  Law  Journal,  Vol.  XVIII,  p.  454  (see  above, 
Chapter  XXXVII). 

3  This  paper  will  concern  itself  wholly  with  the  validity  of  the  regulation  of 
hours  of  labor  as  a  problem  in  what  Mr.  Justice  Holmes  calls  the  "apologetics 
of  the  police  power."  Therefore  objections  to  the  specific  statute  under  con- 
sideration because  (i)  it  fails  to  make  provision  for  emergencies,  (2)  it  is  a 
denial  of  the  equal  protection  of  the  laws  by  reason  of  arbitrary  classification, 

614 


perhaps,  briefly  to  summarize  the  state  of  the  authorities  deal- 
ing with  regulation  of  the  hours  of  labor.  Such  a  summary  will 
tell  a  useful  tale  of  legal  history;  it  will  do  more — it  may  guide  us 
not  a  little  in  the  solution  of  present-day  constitutional  problems. 

For  the  purpose  of  legal  analysis  these  cases  fall  into  three  groups  :^ 
(i)  regulation  of  the  labor  of  women  and  children;  (2)  regulation 
of  labor  in  dangerous  or  peculiarly  unhealthful  employments ;  and 
(3)  regulation  of  labor  in  industry  generally. 

I.  REGULATION  OF  LABOR  OF  WOMEN  AND  CHILDREN 

Commomvealth  v.  Hamilton  Mjg.  Co.,  120  Mass.  383  (1876),  sus- 
tained a  law  prohibiting  the  labor  of  women  and  children  for  more 
than  sixty  hours  per  week  in  manufacturing  establishments.  The 
statute  was  sustained  as  a  matter  of  course.  No  reference  whatever 
was  made  to  the  Fourteenth  Amendment,  and  counsel  was  apparently 
unable  to  "refer  to  any  particular  clause  of  the  [Massachusetts] 
Constitution  to  which  this  provision  is  repugnant"  (p.  384). 

Ritchie  v.  People,  155  111.  98  (1895),^  invalidated  an  eight-hour 
law  for  women  as  ''a  purely  arbitrary  restriction  upon  the  funda- 
mental right  of  the  citizen  to  control  his  or  her  own  time  and 
faculties"  (p.  108). 

Wenham  v.  State,  65  Neb.  394  (1902),^  sustained  a  sixty-hour-per- 
week  law  for  women  on  the  ground  that  "  women  and  children  have 
always,  to  a  certain  extent,  been  wards  of  the  state,"  and  that  while 
"the  employer  and  the  laborer  are  practically  on  an  equal  footing 

.  .  .  these  observations  do  not  apply  to  women  and   children" 

(P-405)- 

and  (3)  it  interferes  with  a  field  taken  over  by  Congress  in  the  Hours  of 
Service  Act  of  March  4,  1907,  or  special  arguments  in  its  favor,  based  (a)  on 
the  power  to  amend  corporate  charters  and  {h)  on  the  fact  that  a  special 
obligation  may  be  imposed  on  public-service  companies,  are  all  put  on  one  side. 
^  Cases  involving  the  validity  of  legislation  as  to  hours  of  labor  upon  public 
works  or  work  done  for  the  public  are  not  considered.  All  recent  important 
authorities  now  sustain  such  legislation,  not  as  an  exercise  of  the  police  power 
but  as  an  assertion  by  the  state  of  its  right  to  regulate  the  conditions  under 
which  public  work  shall  be  done.  (Atkin  v.  United  States,  191  U.S.  207  (1903)  ; 
People  V.  Crane,  214  N.  Y.  154,  108  N.  E.  427  (1915),  affirmed,  239  U.S.  195 
(1915) ;  Heim  v.  McCall,  214  N.Y.  629,  108  N.  E.  1095  (iQiS),  affirmed,  239 
U.S.  17s  (1915).)  2^0  N.E.  454.  391   N.W.  421. 


6i6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

State  V.  Buchanan,  29  Wash.  602   (1902)/  sustained  a  ten-hour 
law  for  women  in  mechanical  and  mercantile  establishments. 

It  is  a  matter  of  universal  knowledge  with  all  reasonably  intelli- 
gent people  of  the  present  age  that  continuous  standmg  on  the  feet 
by  women  for  a  great  many  consecutive  hours  is  deleterious  to  their 
health  .  .  .  While  the  principles  of  justice  are  immutable,  changing 
conditions  of  societv  and  the  evolution  of  employment  make  a  change 
in  the  application  of  principles  absolutely  necessary  to  an  intelligent 
administration  of  government.  In  the  early  history  of  the  law,  when 
employments  were  few  and  simple,  the  relative  conditions  of  the 
citizen  and  the  state  were  different,  and  many  employments  and 
uses  which  were  then  considered  inalienable  rights  have  since,  from 
the  very  necessity  of  changed  conditions,  been  subjected  to  legislative 
control,  restriction,  and  restraint  (p.  610). 

People  V.  Williams,  189  N.Y.  131  (1907),'  declared  invalid  a 
statute  prohibiting  night  work  of  women  because  "it  is,  certainly, 
discriminative  against  female  citizens,  in  denying  to  them  equal  rights 
with  men  in  the  same  pursuit"  (p.  135)- 

Burcher  v.  People,  41  Col.  495  (iQO?),"  nullified  an  eight-hour 
law  for  women  and  children  because  (i)  under  the  Colorado  Con- 
stitution the  legislature  must  specifically  designate  what  pursuits  are 
unhealthful,  and  (2)  even  if  the  Court  had  power  to  pass  on  the 
issue  "  the  laundry  business  must  be  considered  healthful ;  for  coun- 
sel themselves,  in  their  stipulation  of  facts,  on  which  the  record 
shows  the  cause  was  decided,  are  in  accord  that  such  occupation  is 

healthful"  (p.  504). 

Muller  V.  Oregon,  208  U.S.  412  (1908),  sustained  the  constitu- 
tionality of  a  ten-hour  law  for  women  in  any  mechanical  establish- 
ment or  factory  or  laundry. 

The  legislation  and  opinions  referred  to  .  .  .  may  not  be,  techni- 
cally speaking,  authorities,  and  in  them  is  little  or  no  discussion  of 
the  constitutional  question  presented  to  us  for  determination,  yet 
they  are  significant  of  a  widespread  belief  that  woman's  physical 
structure,  and  the  functions  she  performs  in  consequence  thereof, 
justify  special  legislation  restricting  or  qualifying  the  conditions 
under  which  she  should  be  permitted  to  toil   (p.  420). 

The  limitations  which  this  statute  places  upon  her  contractual 
powers,  upon  her  right  to  agree  with  her  employer  as  to  the  time  she 
shall  labor,  are  not  imposed  solely  for  her  benefit,  but  also  largely  for 
the  benefit  of  all  (p.  422). 

i7oPac.  52.  28i  N.E.  778.  393  Pac.  14. 


HOURS  OF  LABOR 


617 


Ritchie  &  Co.  v.  Wayman,  244  111.  509  (1910),'  sustained  a  ten- 
hour  law  for  women  in  any  mechanical  establishment,  factory,  or 
laundry.  A  heroic  effort  is  made  to  distinguish  the  first  Ritchie  case 
from  the  second  Ritchie  case.  It  is  true  that  one  was  an  eight-hour 
law  and  .the  other  was  a  ten-hour  law,  but  the  two  cases  are,  in 
fact,  irreconcilable  in  their  underlying  point  of  view. 

Sturges  v.  Bcauchamp,  231  U.S.  320  (1914),  sustained  the 
Illinois  Child  Labor  Law  as  an  exercise  "  of  the  protective  power  of 

government." 

Riley  v.  Massachusetts,  232  U.  S.  671  (1914),  sustained  a  Massa- 
chusetts fifty-four-hour-per-week  statute. 

Hawley  v.  Walker,  232  U.S.  718  (1914),  sustained  an  Ohio  nine- 
hour  statute. 

Miller  V.  Wilson,  236  U.S.  373  (1915);  Bosley  v.  McLaughlin, 
236  U.  S.  385.  In  these  two  able  opinions  by  Mr.  Justice  Hughes 
the  United  States  Supreme  Court  sustained  the  extremest  regulation 
of  hours  of  labor  to  date— California  statutes  limiting  the  labor  of 
women  in  certain  pursuits  to  forty-eight  hours  per  week. 

It  is  manifestly  impossible  to  say  that  the  mere  fact  that  the  statute 
of  California  provides  for  an  eight-hour  day,  or  a  maximum  of  forty- 
eight  hours  a  week,  instead  of  ten  hours  a  day  or  fifty-four 
hours  a  week,  takes  the  case  out  of  the  domain  of  legislative 
discretion.  This  is  not  to  imply  that  a  limitation  of  the  hours  of  labor 
of  women  might  not  be  pushed  to  a  wholly  indefensible  extreme,  but 
there  is  no  ground  for  the  conclusion  here  that  the  limit  of  the 
reasonable  exertion  of  protective  authority  has  been  overstepped 
(p.  382). 

People  v.  Schweinler  Press,  214  N.  Y.  395  (1915)-^  The  Court  of 
Appeals  sustained  a  statute  prohibiting  night  work  for  women  and 
with  courageous  frankness  expressly  overruled  People  v.  Williams, 
supra. 

Impairment  caused  by  exhaustion  or  even  ordinary  weariness  must 
be  repaired  by  normal  and  refreshing  sleep  and  rest  if  health  and 
efficiency  are  to  be  preserved  (p.  401). 

.  .  .  surely  it  is  a  matter  of  vital  importance  to  the  state  that  the 
health  of  thousands  of  women  working  in  factories  should  be  pro- 
tected and  safeguarded  from  any  drain  which  can  reasonably  be 
avoided.    This  is  not  only  for  their  own  sakes  but,  as  is  and  ought 


191  N.E.  695- 


2 108  N.E.  639. 


11 


m\ 


M 

^^H 


6i8       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

to  be  constantly  and  legitimately  emphasized,  for  the  sake  of  the 
children  whom  a  great  majority  of  them  will  be  called  on  to  bear 
and  who  will  almost  inevitably  display  in  their  deficiencies  the  un- 
fortunate inheritance  conferred  upon  them  by  physically  broken 
down  mothers  (pp.  405-406). 


II.  REGULATION  OF  LABOR  IN  DANGEROUS  EMPLOYMENTS 

Holden  v.  Hardy,  169  U.  S.  366  (1898)/  sustained  a  Utah  statute 
limiting  to  eight  the  hours  of  labor  in  underground  mines.  Familiar 
as  this  case  is,  a  few  sentences  from  the  powerful  opinion  of  Justice 
Brown  will  bear  requoting: 

The  enactment  does  not  profess  to  limit  the  hours  of  all  workmen, 
but  merely  those  who  are  employed  in  underground  mines,  or  in  the 
smelting,  reduction,  or  refining  of  ores  or  metals.  These  employments, 
when  too  long  purj^ued,  the  legislature  has  judged  to  be  detrimental 
to  the  health  of  the  employees,  and,  so  long  as  there  are  reasonable 
grounds  for  believing  that  this  is  so,  its  decision  upon  this  subject 
cannot  be  reviewed  by  the  federal  courts  (p.  395). 

The  legislature  has  also  recognized  the  fact,  which  the  experience 
of  legislators  in  many  states  has  corroborated,  that  the  proprietors  of 
these  establishments  and  their  operatives  do  not  stand  upon  an  equal- 
ity, and  that  their  interests  are,  to  a  certain  extent,  conflicting.  The 
former  naturally  desire  to  obtain  as  much  labor  as  possible  from 
their  employees,  while  the  latter  are  often  induced  by  the  fear  of 
discharge  to  conform  to  regulations  which  their  judgment,  fairly 
exercised,  would  pronounce  to  be  detrimental  to  their  health  or 
strength.  In  other  words,  the  proprietors  lay  down  the  rules  and 
the  laborers  are  practically  constrained  to  obey  them.  In  such  cases 
self-interest  is  often  an  unsafe  guide,  and  the  legislature  may  properly 
interpose  its  authority  (p.  397). 

The  question  in  each  case  is  whether  the  legislature  has  adopted  the 
statute  in  exercise  of  a  reasonable  discretion,  or  whether  its  action  be 
a  mere  excuse  for  an  unjust  discrimination,  or  the  oppression  or 
spoliation  of  a  particular  class  (p.  398). 

In  re  Morgan,  26  Col.  415  (i899).2  The  opinion  of  the  United 
States  Supreme  Court  in  Holden  v.  Hardy,  supra,  was  not  con- 
vincing   to    the    Supreme    Court    of    Colorado,    and    with    sturdy 

1  It  is  worth  while  to  note  that  Mr.  Justice  Brewer  and  Mr.  JusUce  Peckham 
dissented.  =53  Pac.  1071. 


HOURS  OF  LABOR 


619 


independence  that  court  nullified  a  similar  eight-hour  law  as  to 
underground  mines.^ 

The  result  of  our  deliberation,  therefore,  is  that  this  act  is  an  un- 
warrantable interference  with,  and  infringes,  the  right  of  both  the  em- 
ployer and  employee  in  making  contracts  relating  to  a  purely  private 
business,  in  which  no  possible  injury  to  the  public  can  result  (p.  450)- 

Re  Ten  Hour  Law  for  Street  Railway  Corporations,  24  R.  I.  603 
(1902),-  in  an  advisory  opinion  declared  constitutional  a  ten-hour 
statute  for  employees  operating  street  railways. 

Ex  parte  Boyce,  27  Nev.  299  (1904) ;'  followed  in  Ex  parte  Kair, 
28  Nev.  127;  ibid.  425  (iQOS);*  and 

State  v.  Cantivell,  179  Mo.  245  (1904),°  sustained  an  eight-hour 
law  for  underground  mining  work. 

Baltimore  &  Okio  R.  R.w.  Interstate  Commerce  Commission,  221 

U.S.  612    (1911),  sustained  the  constitutionality  of  the  Hours  of 

Service  Act  of  March  4,  1907. 

The  fundamental  question  here  is  whether  a  restriction  upon  the 
hours  of  labor  of  employees  who  are  connected  with  the  movement  of 
trains  in  interstate  transportation  is  comprehended  within  this  sphere 
of  authorized  legislation.    This  question  admits  of  but  one  answer. 
The  length  of  hours  of  service  has  direct  relation  to  the  efficiency  of 
the  human  agencies  upon  which  protection  to  life  and  property  neces- 
sarily depends.   This  has  been  repeatedly  emphasized  in  official  reports 
of  the  Interstate  Commerce  Commission,  and  is  a  matter  so  plain  as  to 
require  no  elaboration.    In  its  power  suitably  to  provide  for  the  safety 
of  employees  apd  travelers,  Congress  was  not  limited  to  the  enactment 
of  laws  relating  to  mechanical  appliances,  but  it  was  also  competent 
to  consider,  and  to  endeavor  to  reduce,  the  dangers  incident  to  the 
strain  of  excessive  hours  of  duty  on  the  part  of  engineers,  conductors, 
train  dispatchers,  telegraphers,  and  other  persons  embraced  withm 
the  class  defined  by  the  act.    And  in  imposing  restrictions  having 
reasonable  relation  to  this  end  there  is  no  interference  with  liberty 
of  contract  as  guaranteed  by  the  Constitution  (pp.  618-619). 

iTo  avoid  the  grotesque  clash  between  state  courts  and  the  Supreme  Court 
as  to  the  scope  of  constitutional  protection  of  the  same  fundamental  nghts  a 
recommendation  to  leave  the  protection  of  such  rights  entirely  to  the  Fourteenth 
Amendment,  and  therefore  omit  the  corresponding  provisions  of  the  BUI  of 
Rights  in  our  state  constitutions,  has  received  the  support  of  distmgmshed 
members  of  the  profession  and  of  statesmen  like  ex-President  Taft  and  ex- 
Attorney-General  Wickersham. 

254  Atl  602.  "'So  Pac.  463;  82  td.  453. 

37s  Pac.  I.  578S.W.  569. 


ill 


620       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

XXL  REGULATION  OF  HOURS  OF  LABOR  IN   GENERAL 

Low  V.  Rees  Printing  Co.,  41  Neb.  127  (1894)/  declared  uncon- 
stitutional an  eight-hour  day  for  mechanics  and  laborers,  both 
because  it  was  class  legislation  and  violative  of  liberty  of  contract. 
After  naively  regarding  it  as  irrelevant  to  consider  the  impulse  back 
of  such  legislation-  the  Court  nullified  the  statute  as  an  attempt 
by  the  legislature  to  "prohibit  harmless  acts  which  do  not  concern 
the  health,  safety,  and  welfare  of  society"   (p.  147). 

Lochner  v.  New  York,  198  U.S.  45  (1905).  In  this  well-known 
case  the  Supreme  Court  invalidated  a  ten-hour  law  for  bakers. 
Speaking  for  the  five  majority  judges,  Mr.  Justice  Peckham  declared 
that  ''to  the  common  understanding  the  trade  of  a  baker  has  never 
been  regarded  as  an  unhealthy  one"  (p.  59),  and  therefore  '*the  act 
is  not,  within  any  fair  meaning  of  the  term,  a  health  law,  but  is  an 
illegal  interference  with  the  rights  of  individuals,  both  employers  and 
employees,  to  make  contracts  regarding  labor  upon  such  terms  as 
they  may  think  best,  or  which  they  may  agree  upon  with  the  other 
parties  to  such  contracts.  Statutes  of  the  nature  of  that  under  re- 
view, limiting  the  hours  in  which  grown  and  intelligent  men  may 
labor  to  earn  their  living,  are  mere  meddlesome  interferences  with  the 
rights  of  the  individual.  .  .  ."  (p.  61). 

The  vigorous  dissenting  opinions  of  Harlan,  White,  Day,  and 
Holmes,  JJ.,  are  familiar.  But  the  following,  from  the  opinion  of 
Mr.  Justice  Holmes,  pithily  and  completely  puts  the  other  point  of 
view  in  the  clash  of  ideas  then  before  the  Court : 

I  think  that  the  word  liberty  in  the  Fourteenth  Amendment  is  per- 
verted when  it  is  held  to  prevent  the  natural  outcome  of  a  dominant 
opinion,  unless  it  can  be  said  that  a  rational  and  fair  man  neces- 
sarily would  admit  that  the  statute  proposed  would  infringe  funda- 
mental principles  as  they  have  been  understood  by  the  traditions  of 
our  people  and  our  law.  It  does  not  need  research  to  show  that  no 
such  sweeping  condemnation  can  be  passed  upon  the  statute  before 
us.  A  reasonable  man  might  think  it  a  proper  measure  on  the  score 
of  health.    Men  whom  I  certainly  could  not  pronounce  unreasonable 

150  N.W.  362. 

2" For  some  reason,  not  necessary  to  consider,  there  has  in  modern  times 
arisen  a  sentiment  favorable  to  paternalism  in  matters  of  legislation"  (p.  135, 
italics  ours) . 


HOURS  OF  LABOR 


621 


would  uphold  it  as  a  first  installment  of  a  general  regulation  of  the 
hours  of  work  (p.  76).^ 

State  V.  Miksicek,  225  Mo.  561  (1909),^  invalidated  a  six-days  act 
-rest  one  day  in  seven-for  bakers  as  an  arbitrary  infrmgement 

of  liberty  of  contract. 

State  V  Lumber  Co.,  102  Miss.  802  (1912)/'  sustained  a  ten-hour 
law  for  labor  employed  in  manufacturing.  The  Court  decided  that 
the  Lochner  case  did  not  control  on  the  facts,  and,  significantly,  relied 
on  the  dissenting  opinions  in  that  case  for  the  statement  of  the 
governing  principles. 

It  would  not  be  unreasonable  for  the  legislature  to  decide  that  it 
would  promote  the  health,  peace,  morals,  and  general  welfare  o  a 
laborers  engaged  in  the  work  of  manufacturing  or  repairing  if  they 
were  not  permitted  to  extend  their  labor  over  ten  hours  a  day,  and  the 
legislature  could  also  decide  that  the  best  interests  of  the  people  in 
the  state  would  be  promoted  by  limiting  the  time  of  work  of  this 
numerous  class  of  its  citizenry  to  the  time  mentioned.  In  fact  when 
we  consider  the  present  manner  of  laboring,  the  use  of  machinery 
the  appliances,  requiring  intelligence  and  skill,  and  the  general 
present-day  manner  of  life,  which  tends  to  nervousness,  it  seems  to 
us  quite  reasonable,  and  in  no  way  improper,  to  pass  such  law  so 
limiting  a  day's  labor  (p.  834). 

On  rehearing  the  decision  was  affirmed,*  the  Court  taking  occasion 
to  comment  upon  "  the  notable  fact  that  it  is  rare  for  the  seller  of 
labor  to  appeal  to  the  courts  for  the  preservation  of  his  inalienable 
rights  to  labor.  This  inestimable  privilege  is  generally  the  object 
of  the  buyer's  disinterested  solicitude.  Some  day,  perhaps,  the  in- 
alienable right  to  rest  will  be  the  subject  of  litigation  .  .  ."■'  (103 
Miss.  267-268). 

iSee  the  elaboration   and  application  of  this  last  thought  in  Mr    Justice 
Holmes's  dissenting  opinions  in   Adair  v.   United  States    208   U.S.   161,   190 
(1908),  and  Coppage  v.  Kansas,  236  U.S.  i,  26-27  (191S). 
2125  S.W.  507- 

359  So.  923-  _  ,         . 

*State  V.  Lumber  Co.,  103  Miss.  263,  60  So.  215  (i9i3)-  .       ^     . 

•-.See  a  similar  observation  in  H olden  v.  Hardy,  169  U.S.  369,  397,  supra. 
"It  may  not  be  improper  to  suggest  in  this  connection  that  although  the  prose- 
cution In  this  case  was  against  the  employer  of  labor,  .  .  his  defense  is  not  so 
much  that  his  right  to  contract  has  been  infringed  upon,  but  that  the  act  works 
a  peculiar  hardship  to  his  employees,  whose  right  to  labor  as  long  as  they  please 
is  alleged  to  be  thereby  violated.  The  argument  would  certamly  come  with 
better  grace  and  greater  cogency  from  the  latter  class." 


■ 


622       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


tL 


« 


State  V.  Barba,  132  La.  768  (1913)/  held  unconstitutional  an 
eight-hour  law  for  stationary  firemen,  both  because  it  constituted 
an  arbitrary  classification  and  impaired  the  liberty  of  contract. 

State  V.  Bunting,  71  Ore.  259  (1914),-  sustained  a  ten-hour  law 
for  labor  in  factories.  In  this  case  the  Court  again  found  the  dis- 
senting opinions  of  the  Lochner  case  rather  than  the  decision  on 
the  facts  of  that  case  the  relevant  authority. 

A  certain  minimum  of  physical  well-being  is  necessary  in  order 
that  social  life  may  exist,  the  usefulness  and  intelligence  of  the  citi- 
zens be  increased,  and  the  progress  of  civilization  accelerated 
(Freund,  "Police  Power,"  sects.  8,  10).  .  .  .  The  required  minimum 
of  well-being  varies  in  different  periods,  but  rises  with  advancing 
civilization  until  it  includes  a  certain  standard  of  comfort.  ...  It  is 
an  undeniable  fact  that  prolonged  and  excessive  physical  labor  is  per- 
formed at  the  expense  of  the  mental  powers,  and  it  requires  no  argu- 
ment to  show  that  a  man  who  day  in  and  day  out  labors  more 
than  ten  hours  must  not  only  deteriorate  physically,  but  men- 
tally. ...  In  view  of  the  well-known  fact  that  the  custom  in  our 
industries  does  not  sanction  a  longer  service  than  ten  hours  per  day, 
it  cannot  be  held,  as  a  matter  of  law,  that  the  legislative  require- 
ment is  unreasonable  or  arbitrary  as  to  hours  of  labor.  ...  It  is 
urged  .  .  .  that  if  it  is  possible  for  the  legislature  to  make  the  dec- 
laration that  to  work  in  a  factory  more  than  ten  hours  in  one  day  is 
injurious  to  the  health,  then  that  body  can  make  four  hours  a  day's 
work,  and  require  two  hours  of  the  work  to  be  performed  before 
eight  o'clock  a.m.  It  is  sufficient  to  say  that  the  question  of  four 
hours'  constituting  a  day's  labor,  or  when  any  part  of  it  shall  be  done, 
is  not  now  before  this  Court  (pp.  267,  272,  273). 

People  v.  Klinck  Packing  Co.,  2i4N,Y.  121  (1915).^  "The  right 
to  rest," — or  rather  the  need  for  leisure, — to  which  the  Supreme 
Court  of  Mississippi  adverted  in  1912,  quickly  received  authoritative 
recognition  from  the  New  York  Court  of  Appeals.  In  this  case  there 
was  sustained  a  statute  requiring  one  day  of  rest  in  seven.  The  proper 
sphere  of  legislative  discretion  and  a  correspondingly  limited  scope  of 
judicial  review  are  put  most  excellently  by  Judge  Hiscock : 

Our  only  inquiry  must  be  .  .  .  whether  it  can  fairly  be  believed 
that  its  [the  statute's]  natural  consequences  will  be  in  the  direction 
of  betterment  of  public  health  and  welfare,  and,  therefore,  that  it  is 

161  So.  784. 

2Appeal  now  pending  before  the  Supreme  Court  of  the  United  States. 

3io8  N.E.  278. 


!'l 


HOURS  OF  LABOR 


623 


one  which  the  state  for  it^  protection  and  advantage  may  enact  and 
enforce.  It  seems  to  me  very  clear  that  we  may  answer  that  it  is 
such  an  one.  ...  A  constantly  increasing  study  of  industrial  con- 
ditions I  believe  leads  to  the  conviction  that  the  health,  happiness, 
intelligence  and  efficiency  even  of  an  adult  man  laboring  in  such 
employments  [factory  and  mercantile]  as  those  mentioned  in  this 
statute  will  be  increased  by  a  reasonable  opportunity  for  rest,  for 
outdoor  life  and  recreation,  for  attention  to  his  own  affairs,  and,  if 
he  will,  study  and  education. 

Then  we  come  to  the  question,  what  is  a  reasonable  opportunity, 
and  within  wide  limits  that  problem  is  for  the  legislature.  Anybody 
would  probably  say  that  one  day  in  thirty  or  sixty  would  be  too 
little  and  one  day  in  each  two  days  extravagant.  Between  these 
extremes  none  can  safely  assert  that  the  mean  adopted  by  the 
legislature  of  one  day  in  seven  is  unreasonable  (pp.  127-128).^ 

A  study  of  these  opinions  indicates  a  change  not  only  in  the  de- 
cisions but  in  the  groundwork  of  the  decisions.  We  find  a  shift  in 
the  point  of  emphasis,  a  modification  of  the  factors  that  seem 
relevant,  a  different  statement  of  the  issues  involved,  and  a  difference 
in  the  technic  by  which  they  are  to  be  solved.  The  turning  point 
comes  in  1908  with  Muller  v.  Oregon.^  While  lone  voices  of  wisdom 
had  been  heard  for  almost  two  decades,^  and  the  tendency  was  clearly 
in  its  direction,  yet  this  case  marks  the  culmination. 

Prior   to    1908   the   decisions   disclose   certain   marked    common 

characteristics^ 

I.  Despite  disavowal  that  the  policy  of  legislation  is  not  the  courts* 
concern,  there  is  an  unmistakable  dread  of  the  class  of  legislation 
under  digcugsion.*  Intense  feeling  against  the  policy  of  the  legislation 
mustJxievitaWyJbaYfi.  influenced  the  result  in  the  decisions.    In  truth 

1  Since  the  decision  of  the  Massachusetts  case  under  discussion  the  Supreme 
Court  of  Louisiana  has  again  declared  unconstitutional  an  eight-hour  law  for 
stationary  firemen,  partly  as  unfair  classification  (because  applying  only  to 
cities  over  50,000)  and  partly  as  an  impairment  of  liberty  of  contract  (77  So. 

(La.)  70  (1915))- 

2208  U.S.  412,  supra. 

3  See  the  dissenting  opinion  of  Mr.  Justice  Holmes  in  Commonwealth  v. 
Perry,  155  Mass.  117,  123  (1891);  Thayer,  Legal  Essays,  i;  Green  Bag,  Vol. 

XXVI,  pp.  511,  S14. 

4 "The  tendency  of  legislatures,  in  the  form  of  regulatory  measures,  to  mter- 
fere  with  the  lawful  pursuits  of  citizens  is  becoming  a  marked  one  in  this  coun- 
try, and  it  behooves  the  courts,  firmly  and  fearlessly,  to  interpose  the  barriers 
of  their  judgments  when  invoked   to  protest  against  legislative   acts   plainly 


i 


it 


624       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

this  presents  the  point  oi  greatest  stress  in  our  constitutional  system, 
for  it  requires  minds  of  unusual  intellectual  disinterestedness,  detach- 
ment, and  imagination  to  escape  from  the  too  easy  tendency  to  find 
lack  of  power  where  one  is  convinced  of  lack  of  wisdom. 

2.  Legislation  is  sustained  as  part  of  the  prevailing  philosophy  of 
individualism,  as  an  exceptional  protection  to  certairTlndivIHuals 
as  such,  and  not  as  a  recogniti^oiTbf  a  general  social  "Interest.  ~"Thus 
legislation  is  supported  either  because  women  and  children  are  wards 
of  the  state,  are  not  sui  juris,  or  to  relieve  certain  needy  individuals 
in  the  community  from  coercion.^  The  underlying  assumption  was, 
of  course,  that  industry  presented  only  contract  relations  between 
individuals.  That  industry  is  part  of  society,  the  relation  of  busi- 
ness to  the  community,  was  naturally  enough  lost  sight  of  in  the 
days  of  pioneer  development  and  free  land.- 

3-  TJie-xouils.iiere.  deal  with  statutes  seeking  to  effect  in  a  very 
concrete  fashion  the  sjternest  actualities  of  moderQ J^fe :  the  conduct 
of  industry  and  the  labor  of  human  beings  therein  engaged.  Yet  the 
cases  are  decided,  in  the  main,  on  abstract  issues,  on  ^tenacious 
theories  of  economic  and  political  philosophy.  There  is  lack  of 
scientific  method  either  in  sustaining  or  attacking  legislation.  Legis- 
lation is  sustained  or  attacked  on  vague  humanitarianism,  on  pressure 
of  immediate  suffering,  or  "common  understanding."  This  is  not  the 
fault  of  the  courts.  It  was  characteristic  of  our  legislative  processes, 
as  well  as  of  the  judicial  proceedings  which  called  them  into  question. 
It  was  true,  substantially,  of  the  social  legislation  of  the  nineteenth 
century.^ 

The  courts  decided  these  issues  on  a  priori  theories,  on  abstract 
assumptions,  because  scientific  data  were  not  available  or  at  least 

transcending  the  powers  conferred  by  the  Constitution  upon  the  legislative 
body"  {People  v.  Williams,  189  N.Y.  131,  135,  81  N.  E  778,  780  (1907)). 

"This  interference  on  the  part  of  the  legislatures  of  the  several  states  with 
the  ordinary  trades  and  occupations  of  the  people  seems  to  be  on  the  increase " 
(Lochner  v.  New  York,  198  U.S.  45,  63   (1905)). 

^Holden  v.  Hardy,  169  U.S.  366,  397,  supra. 

2 See  the  stimulating  paper,  "Labor,  Capital  and  Business  at  Common  Law," 
by  Edward  A.  Adler,  Harvard  Law  Review,  Vol.  XXIX,  p.  241,  particularly 
pp.  262-274. 

3The  earliest  Factory  Act  was  the  "work  of  benevolent  Tories"  (Dicey, 
Law  and  Opinion  in  England,  2d  ed.,  p.  no,  and  Lecture  VII,  particularly  pp.  220 
et  seq.,  228,  229;  Goldmark,  Fatigue  and  Efficiency,  chap.  i). 


HOURS  OF  LABOR 


625 


had  not  been  made  available  for  the  use  of  courts.  But  all  this  time 
scientific  data  had  been  accumulating.  Organized  observation,  in- 
vestigation, and  experimentation  produced  facts,  and  science  could 
at  last  speak  wath  rational  if  tentative  authority.  There  was  a  grow- 
ing body  of  the  world's  experience  and  the  validated  opinions  of  those 
competent  to  have  opinions.  Instead  of  depending  on  a  priori  con- 
troversies raging  around  jejune  catchwords  like  ''individualism"  and 
"collectivism,"  it  became  increasingly  demonstrable  what  the  effect 
of  modern  industry  on  human  beings  was  and  what  the  reasonable 
likelihood  to  society  of  the  effects  of  fixing  certain  minimum  standards 

of  life. 

The  jMuller  case,  in  1908,  was  the  first  case  presented  to  our  courts! 
on  the  basis  of  authoritative  data.  For  the  first  time  the  arguments 
and  briefs  breathed  the  air  of  reality.  The  response  of  the  Court  on 
this  method  of  presenting  the  case  is  significant. 

In  patent  cases  counsel  are  apt  to  open  the  argument  with  a  dis- 
cussion of  the  state  of  the  art.  It  may  not  be  amiss,  in  the  present 
case,  before  examining  the  constitutional  question,  to  notice  the 
course  of  legislation  as  well  as  expressions  of  opinion  from  other  than 
judicial  sources.  In  the  brief  filed  by  Mr.  Louis  D.  Brandeis,  for 
the  defendant 
matters.  .  .  .^ 


in  error,  is  a  very  copious  collection  of  all   these 


^Midler  v.  Oregon,  208  U.S.  412,  419  (1907)-  The  great  mass  of  data  con- 
tained in  the  brief  is  epitomized  in  the  margin  of  the  Court's  opinion.  Miss 
Josephine  Goldmark,  Publication  Secretary  of  National  Consumers'  League, 
collaborated  with  Mr.  Brandeis  in  the  preparation  of  this  and  subsequent  briefs, 
which  are  now  available  in  Part  II  of  Miss  Goldmark's  book  "Fatigue  and 

Efficiency." 

The  present-day  demand  for  scientific  ascertainment  of  facts  for  legislation 
and  administration  is  strikingly  illustrated  by  Miss  Lathrop  in  her  Third  Annual 
Report  as  Chief  of  the  United  States  Children's  Bureau  (1915)-  "The  whole 
field  of  child  labor  is  thus  far  singularly  barren  of  scientific  study.  .  .  .  Full 
and  intelligent  protection  of  the  physique  and  mental  powers  of  the  youthful 
workers  in  this  country  requires  costly  and  laborious  studies  in  laboratory  and 
in  workshop.  .  .  .  The  Children's  Bureau  now  desires  to  call  attention  to  these 
studies  and  to  submit  the  reasonableness  of  spending  money  to  make  them.  It 
proposes  a  later  presentation  of  carefully  considered  plans  for  which  certain 
preparatory  studies  are  now  going  forward.  The  more  rapidly  the  restrictive 
child-labor  legislation  becomes  uniform,  the  more  evident  must  be  the  need  of 
studying  the  welfare  of  the  young  worker  within  the  occupation,  so  that  we 
may  secure  just  standards  for  the  use  of  labor,  as  new  standards  for  material 
are  being  developed"  (pp.  23,  24). 


I 


:  ■* 


62  6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  legislation  and  opinions  referred  to  in  the  margin  may  not  be, 
technically  speaking,  authorities,  and  in  them  is  little  or  no  discussion 
of  the  constitutional  question  presented  to  us  for  determination,  yet 
they  are  significant  of  a  widespread  belief  that  woman's  physical 
structure,  and  the  functions  she  performs  in  consequence  thereof, 
justify  special  legislation  restricting  or  qualifying  the  conditions 
under  which  she  should  be  permitted  to  toil.  Constitutional  ques- 
tions, it  is  true,  are  not  settled  by  even  a  consensus  of  present  public 
opinion,  for  it  is  the  peculiar  value  of  a  written  constitution  that  it 
places  in  unchanging  form  limitations  upon  legislative  action,  and 
thus  gives  a  permanence  and  stability  to  popular  government  which 
otherwise  would  be  lacking.  At  the  same  time,  when  a  question  oj 
fact  is  debated  and  debatable,  and  the  extent  to  which  a  special  con- 
stitutional limitation  goes  is  affected  by  the  truth  in  respect  to  that 
facty  a  widespread  and  long-continued  belief  concerning  it  is  worthy 
of  consideration^  (italics  ours). 

That  upon  such  showing  the  Supreme  Court  should  sustain  the 
contested  statute  was  inevitable.  But  the  Muller  case  is  "epoch- 
making  "  not  because  of  its  decision  but  because  of  the  authoritative 
recognition  by  the  Supreme  Court  that  the  way  in  which  Mr.  Brandeis 
presented  the  case — the  support  of  legislation  by  an  array  of  facts 
which  established  the  reasonableness  of  the  legislative  action,  how- 
ever it  may  be  with  its  wisdom — laid  down  a  new  technic  for  coun- 
sel charged  with  the  responsibility  of  arguing  such  constitutional 
questions,  and  an  obligation  upon  courts  to  insist  upon  such  method 
of  argument  before  deciding  the  issue,  surely,  at  least,  before  deciding 
the  issue  adversely  to  the  legislature.  For  there  can  be  no  denial 
that  the  technic  of  the  brief  in  the  Muller  case  has  established  itself 
through  a  series  of  decisions  within  the  last  few  years,  which  have 
caused  not  only  change  in  decisions  but  the  much  more  vital  change 
of  method  of  approach  to  constitutional  questions.^ 

The  most  striking  illustration  is  the  attitude  of  the  New  York 
Court  of  Appeals  in  People  v.  Schweinler  Press.^  In  that  case,  it  will  be 

"^  Muller  V.  Oregon,  208  U.  S.  420-421. 

2See  briefs  in  Ritchie  &  Co.  v.  Waytnan,  244  111.  509,  91  N.  E.  695  (1910) ; 
Hawley  v.  Walker,  232  U.  S.  718  (1914) ;  Miller  v.  Wilson,  236  U.  S.  373  (1915) ; 
Bosley  v.  McLaughlin,  236  U.S.  385  (1915)  ;  Stettler  v.  O'Hara,  69  Ore.  519, 
139  Pac.  743  (1914)  (and  brief  in  the  same  case  now  pending  before  the  Su- 
preme Court  of  the  United  States) ;  People  v.  Schweinler  Press,  214  N.  Y.  395, 
108  N.  E.  639  (1915)- 

»2i4  N.Y.  395,  108  N.  E.  639  (191S). 


HOURS  OF  LABOR 


627 


recalled,  the  Court  courageously  overruled  People  v.  Williams,  supra," 
and  sustained  a  statute  prohibiting  night  work  for  women.  We  find 
a  careful  ascertainment  of  facts  by  the  legislature  as  the  basis  of  its 
action,  and  thereafter  a  careful  presentation  of  facts  before  the  Court 
to  support  the  legislative  reason.  Not  only  was  there  a  presentation 
of  facts  in  191 5  such  as  counsel  failed  to  make  in  1907  but  there 
was  a  presentation  of  new  facts  acquired  since  1907.  If  the  point  of 
view  laid  down  in  this  case  be  sedulously  observed  in  the  argument 
and  disposition  of  constitutional  cases,  it  is  safe  to  say  that  no  statute 
which  has  any  claim  to  life  will  be  stricken  down  by  the  courts. 

While  theoretically  we  may  have  been  able  to  take  judicial  notice 
of  some  of  the  facts  and  of  some  of  the  legislation  now  called 
to  our  attention  as  sustaining  the  belief  and  opinion  that  night  work 
in  factories  is  widely  and  substantially  injurious  to  the  health  of 
women,  actually  very  few  of  these  facts  were  called  to  our  attention, 
and  the  argument  to  uphold  the  law  on  that  ground  was  brief  and 
inconsequential.^ 

There  is  no  reason' why  we  should  be  reluctant  to  give  effect  to  new 
and  additional  knowledge  upon  such  a  subject  as  this  even  if  it  did 
lead  us  to  take  a  different  view  of  such  a  vastly  important  question 
as  that  of  public  health  or  disease  than  formerly  prevailed.  Par- 
ticularly do  I  feel  that  we  should  give  serious  consideration  and  great 
weight  to  the  fact  that  the  present  legislation  is  based  upon  and  sus- 
tained by  an  investigation  by  the  legislature  deliberately  and  care- 
fully made  through  an  agency  of  its  own  creation,  the  present  factory 
investigating  commission.^ 

These  recent  cases,  dealing  with  regulation  of  the  hours  of  labor, 
do  not  stand  apart  but  illustrate  two  dominant  tendencies  in  current 
constitutional  decisions : 

I.  Courts,  with  inrre;i>ing  measure^  deal  with  legislation  affgct- 
ing  industry  in  the  light  of _. a,  realistic  study  pf  the  industrial  con- 
3Ttionr¥ffecte3? 

'    2.  TJie  emphasis  is  shifted  to  community  interests^  the  affirmative 
enhancement  of  the  human  values  of  the  whole  community — not 

1189  N.Y.  131,  81  N.E.  778  (1907). 

'People  V.  Schweinler  Press,  214  N.Y.  395,  411,  108  N.  E.  639,  643  (1915)- 

^Ibid.  214  N.Y.  395,  412-413,  108  N.E.  639,  644  (1915). 

*  McLean  v.  Arkansas,  211  U.S.  539,  549-550  (1908)  (it  is  significant  that 
Mr.  Justice  Brewer  and  Mr.  Justice  Peckham  dissented)  ;  Baltimore  &  Ohio 
R.R.  V.  Interstate  Commerce  Commission,  221  U.S.  612,  619  (1911). 


ii    :  i 


if 


628       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

merely  society  conceived  of  as  independent  individuals  dealing  at 
aTrns^Mength  with  one  anoTlier.  in  wRIclTlegislation  may  only  seek  to 
protect  individuals  under  disabilitiesl)r  prevent  individual  aggression 
in  the  interest  of  a  countervailing  individual  freedom.^  — 

As  a  result  we  find  that  recent  decisions  have  modified  the  basis 
on  which  legislation  limiting  the  hours  of  labor  is  supported.  As 
science  has  demonstrated  that  there  is  no  sharp  difference  in  kind 
as  to  the  effect  of  labor  on  men  and  women,  courts  recently  have 
followed  the  guidance  of  science  and  refused  to  be  controlled  by  out- 
worn ignorance.  And  so  we  find  the  Supreme  Court  of  Oregon,  in 
sustaining  the  ten-hour  law  for  men,  observing  that  "legislative 
regulation  of  the  hours  of  labor  of  men  and  that  of  women  differ 
only  in  the  degree  of  necessity  therefor.""  True  enough,  we  are  not 
out  of  the  woods  of  difficulty  by  saying  the  question  is  a  matter  of 
difference  of  degree.  But  once  that  is  recognized,  once  we  cease  to 
look  upon  the  regulation  of  women  in  industry  as  exceptional,  as  the 
law's  graciousness  to  a  disabled  class,  and  shift  the  emphasis  from 
the  fact  that  they  are  women  to  the  fact  that  it  is  industry  and  the 
relation  of  industry  to  the  community  which  is  regulated,  the  whole 
problem  is  seen  from  a  totally  different  aspect.  Once  admit  it  is  a 
question  of  degree,  there  follows  the  recognition — and  the  conscious 
recognition  is  important — that  we  are  balancing  interests,  that  we 
are  exercising  judgment,  and  that  the  exercise  of  this  judgment, 
unless  so  clear  as  to  be  undebatable,  is  solely  for  the  legislature.^ 

What,  then,  are  the  common  factors  in  the  labor  of  men  and 
women  that  would  make  a  limitation  of  the  hours  of  labor,  in  em- 
ployments not  dangerous  orTiThefently^unhealthy,  to  ten  hours  or 
nine  hours  an  exercise  of  legislative  discretion  not  beyond  the  pale 
of  reasonable  argument,  and  therefore  to  be  respected  by  the  courts  ? 
They  are : 

I.  "The  common  physiological  phenomenon,  fatigue,"  and  the 
need  of  rest  to  repair  the  waste  of  the  toxin. ^    Can  the  point  where 

"^ People  V.  Klinck  Packing  Co.,  214  N.Y.  121,  128,  108  N.  E.  278,  280  (1915). 

^State  V.  Bunting,  71  Ore.  25Q,  271,  139  Pac.  731,  735  (1914). 

^Price  V.  Illinois,  238  U.S.  446,  452   (1915). 

*See  Goldmark,  Fatigue  and  Efficiency,  chap.  ii.  The  scientific  views  set 
forth  in  Miss  Goldmark's  book  recently  formed  the  basis  of  an  arbitration 
judgment,  in  Australia,  by  Mr.  Justice  Higgins,  in  the  Waterside  Workers'  case 
(not  yet  reported). 


HOURS  OF  LABOR 


629 


the  line  is  to  be  drawn  possibly  be  fixed  a  priori  ?  Or,  at  the  least, 
in  the  light  of  modern  physiology  is  any  layman  entitled  to  say  that  a 
limitation  of  routine  manual  labor  of  masses  of  men  to  nine  hours 
is  a  capricious  and  willful  oppression,  without  sustaining  reason  ?^ 

2.  Anjenlarged  conception  of  leisure  and  the  tendency  to  regard  not 
only  its  relation  to _the_jr^iediate  effects  upon^anhnaTheallh  biit 
aTso   its   bearing 'on   the   industrial   output   and   the   demands   of 

citizenship.^ 

3.  Experience,  based  upon  adequate  trial,  with  the  gradual  reduc- 
Lionof  laboTandlFe  slow  increase  of  lioiirs  of  Teisure  encouragingly 


demonstrates  ^ai  "such  limitation  of  labor  and  increase  of  leisure 
have  been  put  to  fruitful  uses.  The  tried  measures  of  curtailing 
manual  laboF¥ave  added  to  the  sum  total  of  that  by  which  we 
measure  the  civilized  aspects  of  life.^ 

This,  then,  was  the  "state  of  the  art"  which  confronted  the  Massa- 
chusetts Supreme  Court  in  passing  upon  the  constitutionality  of  the 
nine-hour  law  in  question.  One  would  suppose  that  in  the  light  of 
all  this  it  would  be  an  easy  matter  for  the  Court  to  hold  that  a  nine- 
hour  day  is  not  "so  extravagant  and  unreasonable,  so  disconnected 
with  the  probable  promotion  of  health  and  welfare,  that  its  enactment 
is  beyond  the  jurisdiction  of  the  legislature,"*  or,  at  the  very  least, 
that,  since  the  subject  is  "debatable,  the  legislature  is  entitled  to  its 
own  judgment."^ 

Quite  the  contrary.  The  Court  held  that  the  statute  "is  an  unwar- 
rantable interference  with  individual  liberty  and  an  interference  with 
property  rights,  and  therefore  contrary  to  constitutions  which  secure 
these  fundamental  rights."*^ 

How  could  such  a  result  have  been  reached  ? 

I.  The  case  was  inadequately  presented.  The  Court  was  not  called 
upon  to  pass  on  the  validity  of  the  statute  as  such,  but  upon  an 
agreed  statement  of  facts  under  the  statute  to  the  effect  that  there 

"^Price  V.  Illinois,  238  U.S.  446,  452  (1915),  supra. 

2 See,  for  example,  Hobson,  Work  and  Wealth,  particularly  chaps,  xiv  and  xv; 
Taussig,  Inventors  and  Money  Makers,  pp.  63,  65  et  seq.,  71  et  seq.;  U.S. 
Commissioner  of  Labor  Statistics  Royal  Meeker,  Annals,  Vol.  LXIII,  pp.  262,  267. 

3  See  Goldmark,  Fatigue  and  Efficiency,  p.  279. 

*  People  V.  Klinck  Packing  Co.,  214  N.Y.  121,  127,  108  N.  E.  278,  280  (191S). 

^ Price  V.  Illinois,  238  U.S.  446,  452  (1915)- 

^Commonwealth  v.  Boston  &  M.R.R.,  no  N.  E.  (Mass.)  264  (1915). 


I 


^ 


If 


630       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

is  nothing  inherently  unhealthy  about  the  work  which  the  employee 
did,  as  it  was  half  performed  in  the  open  air  and  was  not  arduous.^ 
The  assumption  back  of  such  a  statement  is  that  where  work  is  not 
inherently  unhealthy  it  is  immaterial  how  long  such  work  is  pursued. 
Thus  a  wholly  unscientific  concession  of  fact  was  made,  and  there- 
fore a  wholly  unscientific  issue  was  presented  to  the  Court.  But 
even  such  an  issue  was  not  supported  by  the  available  body  of  scien- 
tific facts.  No  attempt  was  made  to  bring  to  the  attention  of  the 
Court  a  detailed,  painstaking,  thoroughly  marshaled  array  of  facts  to 
explain  and  to  fortify  the  experience  and  theory  back  of  labor  legis- 
lation. In  other  words,  the  case  was  not  argued  in  the  way  in  which 
the  decisions  in  the  Muller  case,  the  second  Ritchie  case,  the  Hawley 
case,  the  Miller  case,  the  Bosley  case,  and  the  Schweinler  case 
demanded  that  it  should  be  argued. 

2.  One  can  therefore  understand  why  the  Court  found  the  case 
"governed"  by  the  Lochner  case,  suprar  Nevertheless,  one  is  com- 
pelled to  conclude  that  the  illumination  that  has  been  cast  upon  the 
Lochner  case  during  the  past  decade  does  not  leave  to  that  case  any 
principle  which  ipso  facto  controls  the  validity  of  specific  measures 
regulating  hours  of  labor.  The  principle  of  the  Lochner  case  is 
simple  enough:  that  arbitrary  restriction  of  men's  activities,  un- 
related in  reason  to  the  "public  welfare,"  offends  the  Fourteenth 
Amendment.  As  to  the  principle,  there  is  no  dispute.  But  the  prin- 
ciple is  the  beginning  and  not  the  end  of  the  inquiry.  The  field  of 
contention  is  in  its  application.  The  Lochner  case,  judged  by  its  his- 
tory and  by  more  recent  decisions  of  the  Supreme  Court,  does  not  in 
itself  furnish  the  yardstick  for  its  application. 

a.  It  is  now  clearly  enough  recognized  that  each  case_2resents  a 
distinciJssue ;  that  each  case  must  be  determined  by  the  faclTTele^ 
YajaLlP  it ;  that  we  are  dealing,  in  truth,  not  with  a  question  of  law 
but  the  application  of  an  undisputed  formula  to  a  constantly  chang- 
ing and  growing  variety  of  economic  and  social  facts.^    Each  case, 

'^Commonwealth  v.  Boston  &  M.R.R.,  no  N. E.  (Mass.)  264  (191S). 

^Lochner  v.  New  York,  198  U.S.  45  (1905). 

sSee  People  v.  Schweinler  Press,  214  N.  Y.  395,  411-412,  108  N.  E.  639,  643 
(1915);  Bosley  v.  McLaughlin,  236  U.S.  385,  392  et  seq.  (191S) ;  Miller  v. 
Wilson,  236  U.S.  373,  382  (191S) ;  McLean  v.  Arkansas,  211  U.S.  539,  $49-550 
(1908). 


HOURS  OF  LABOR 


631 


therefore,  calls  for  a  new  and  distinct  consideration  not  only  of  the 
general  tacts  ot  industiy  but'TBe^'^ecififc  facts  in  regard  to  the 
employment  in  question  and  the  specific  exigencies  which  called  for 
the  specific  sfaf uleT  "  "■"—■ 

6rThe~groundwork  of  the  Lochner  case  has  by  this  time  been 
cut  from  under.  The  majority  opinion  was  based  upon  "a  common 
understanding"  as  to  the  effect  of  work  in  bakeshops  upon  the  public 
and  upon  those  engaged  in  it.  _^XosunQn  understai^ 
Jto  be  the  reliance  in  matters  calling  for  essentially  scientific  deter- 
mination. "Has  not  the  progress  of  sanitary  science  shown," Professor 
Freund  pertinently  inquires,  "that  common  understanding  is  often 
equivalent  to  popular  ignorance  and  fallacy?"^  On  the  particular 
issue  involved  in  the  Lochner  case  "  study  of  the  facts  has  shown  that 
the  legislature  was  right  and  the  Court  was  wrong."  ^  Either  because 
of  matters  as  to  which  the  Court  of  its  own  knowledge  cannot  know, 
or,  because,  not  knowing,  it  cannot  assume  the  nonexistence  of  facts, 
contested  legislative  action  should  be  resolved  in  favor  of  rationality 
rather  than  capricious  oppression.  Happily  the  fundamental  consti- 
tutional doctrine  of  the  assumption  of  rightness  of  legislative  conduct, 
where  the  court  is  uninformed,  is  again  rigorously  being  enforced  by 
the  United  States  Supreme  Court.^ 

c.  So  far  asthe_£eneralflavor  of  the  Lochner  opinion  goes^it-surely 
is  no  longgf'^^controlling.jl^ff^be^jody  of  professional  opinion  counts 

^  Green  Bag,  Vol.  XVII,  pp.  411,  416. 

2 Professor  Roscoe  Pound,  "Liberty  of  Contract,"  Yale  Law  Journal,  Vol. 
XVIII,  pp.  454,  480,  and  n.  123  (see  above,  Chapter  XXXVII). 

3  Thus,  in  one  of  its  latest  opinions,  the  Supreme  Court  refused  to  upset  a 
"police  measure"  with  the  following  language: 

"Petitioner  makes  his  contention  depend  upon  disputable  considerations  of 
classification  and  upon  a  comparison  of  conditions  of  which  there  is  no  means 
of  judicial  determination .  and  upon  which  nevertheless  we  are  expected  to 
reverse  legislative  action.  .  .  ."  {Hadacheck  v.  Sebastian,  239  U.  S.  394,  413 
(Dec.  20,  1915))- 

Here,  as  elsewhere  in  the  law,  Mr.  Justice  Holmes  long  ago  put  the  matter 
with  acute  finality:  "I  cannot  pronounce  the  legislation  [prohibiting  fines  against 
weavers  for  defective  workmanship]  void,  as  based  on  a  false  assumption,  since 
I  know  nothing  about  the  matter  one  way  or  the  other"  {Commonwealth  v. 
Perry,  155  Mass.  117,  124-125,  28  N.  E.  1126,  1127  (1891)).  As  to  the  reason- 
ableness of  the  legislature's  belief  that  a  system  of  fines  affords  dangerous 
temptations  for  oppressive  use,  see  R.  H.  Tawney,  Minimum  Rates  in  the  Tailor- 
ing Industry,  pp.  60  and  95. 


632       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

for  anything  in  the  appraisal  of  authority  of  a  decision  (itself  decided 
by  a  divided  court,  and  since  departed  from  in  effect  in  an  important 
series  of  cases),  it  has  been  impressively  arrayed  against  this  decision. 
If  ever  an  opinion  has  been  subjected  to  the  weightiest  professional 
criticism,  it  is  the  opinion  in  the  Lochner  case.  Judge  Andrew  Bruce, 
Professor  Ernst  Freund,  Judge  Learned  Hand,  Professor  Roscoe 
Pound — to  mention  no  others — surely  speak  with  high  competence 
upon  this  subject.  Nevertheless,  the  body  of  persuasive  authority 
which  their  writings  present  was  not  brought  to  the  Court's  attention 
and  failed  to  be  considered  in  the  disposition  of  the  case.^ 

The  circumstances  which  resulted  in  this  decision  reveal  anew  a  sit- 
uation of  far-reaching  importance.  For  it  affects  the  very  bases  on 
which  constitutional  decisions  are  reached  and  therefore  affects  vitally 
the  most  sensitive  point  of  contact  between  the  courts  and  the  people. 
The  statute  under  discussion  may  well  have  been  of  no  particular 
social  import.  The  decision  which  nullified  it,  one  may  be  sure,  offers 
no  intrinsic  obstruction  to  needed  legislation  and  in  itself  has  merely 
ephemeral  vitality.  But,  unfortunately,  the  evil  that  decisions  do 
lives  after  them.  Such  a  decision  deeply  impairs  that  public  con- 
fidence upon  which  the  healthy  exercise  of  judicial  power  must  rest. 

Under  the  present-day  stress  of  judicial  work  it  is  inevitable  that 
courts,  on  the  whole,  can  only  decide  specific  cases  as  presented  to 

^A. A.  Bruce,  "The  Illinois  Ten  Hour  Labor  Law  for  Women,"  Michigan 
Law  Review,  Vol.  VIII,  p.  i ;  G.  S.  Corwin,  "The  Supreme  Court  and  the 
Fourteenth  Amendment,"  Michigan  Law  Review,  Vol.  VII,  p.  643  ;  Ernst  Freund, 
"Limitation  of  Hours  of  Labor  and  the  Federal  Supreme  Court,"  Green  Bag, 
Vol.  XVII,  p.  411,  "Constitutional  Limitations  and  Labor  Legislation,"  Illinois 
Law  Review,  Vol.  IV,  p.  609;  L.  N.  Greeley,  "The  Changing  Attitude  of  the 
Courts  toward  Social  Legislation,"  Illinois  Law  Review,  Vol.  V,  p.  222 ;  Learned 
Hand,  "  Due  Process  of  Law  and  the  Eight  Hour  Day,"  Harvard  Law  Review, 
Vol.  XXI,  p.  4ps;  Sir  Frederick  Pollock,  "The  New  York  Labor  Law  and  the 
Fourteenth  Amendment,"  Law  Quarterly  Review,  Vol.  XXI,  p.  211;  Roscoe 
Pound,  "Liberty  of  Contract,"  Yale  Law  Journal,  Vol.  XVIII,  p.  480.  Cf. 
Mr.  Wigmore's  comment  on  "The  Qualities  of  Current  Judicial  Decisions," 
Illinois  Law  Review,  Vol.  IX,  pp.  529,  530-531. 

But  see  Atkins  v.  Grey  Eagle  Coal  Co.,  84  S.  E.  906  (191 5),  where  the  Court 
of  Appeals  of  West  Virginia  sustained  a  truck  act,  in  effect  overruling  the 
decision  in  State  v.  Goodwill,  2^  W.  Va.  179  (i88q),  and  cited  among  its  au- 
thorities Professor  Pound's  article  "Liberty  of  Contract,"  Yale  Law  Journal, 
Vol.  XVIII,  p.  480  (see  above,  Chapter  XXXVII). 


HOURS  OF  LABOR 


633 


them.^    In  other  words,  the  substantial  dependence  upon  the  facts 
and  briefs  presented  by  counsel  throws  the  decision  of  the  courts 
largely  upon  those  chances  which  determine  the  selection  of  counsel. 
These  are,  of  course,  necessary  human  drawbacks,  and  the  practice 
works  out  well  enough  in  controversies  where  purely  individual  inter- 
ests are  represented  by  counsel.    This  is  not  the  situation  in  cases 
such  as  the  one  before  the  Massachusetts  court.    The  issue  submitted 
to  the  Court  in  fact  was  the  issue  as  determined  by  the  District  Attor- 
ney of  Worcester  and  counsel  for  the  Boston  and  Maine  Railroad. 
In  truth,  the  issue  was  between  the  court  and  the  legislature.    In 
such  a  case  either  the  legislative  judgment  should  be  sustained  if 
there  is  "no  means  of  judicial  determination"  that  the  legislature  is 
indisputably  wrong,^  or  the  court  should  demand  that  the  legislative 
judgment  be  supported  by  available  proof.^    It  would  seem  clear 
that  courts  have  inherent  power  to  accomplish  this  by  indicating  the 
kind  of  argument  needed  to  reach  a  just  result  or  even  by  calling  for 
argument  from  members  of  the  bar— officers  of  the  court— of  partic- 
ular equipment  to  assist  in  a  given  problem.*    If  legislation  be  neces- 
sary,  New  York   furnishes   an   example   in    its   recent   enactment 
authorizing  the  courts  to  request  the  attendance  of  the  attorney- 
general  in  support  of  an  act  of  the  legislature  when  its  constitutionality 
is  brought  into  question.^ 

These,  after  all,  are  only  expedients.  Fundamental  is  the  need 
that  the  profession  realize  the  true  nature  of  the  issues  involved  in 
these  constitutional  questions  and  the  limited  scope  of  the  reviewing 
power  of  the  courts.^  With  the  recognition  that  these  questions  raise, 
substantially,  disputed  questions  of  fact  must  come  the  invention 

1  See  Mr.  Justice  Swayze  in  "The  Growing  Law,"  Yale  Law  Journal,  Vol.  XX, 
pp.  I,  18-19.    People  V.  Schweinler  Press,  214  N.Y.  39S,  4ii>  108  N.  E.  639, 

643  (1915). 

ziladacheck  v.  Sebastian,  239  U.  S.  394,  4i3  (iQiS) ;  Price  v.  Illinois,  238  U.  S. 

446,  452  (1915)- 

3 Professor  Ernst  Freund,  "Constitutional  Limitations  and  Labor  Legisla- 
tion," Illinois  Law  Review,  Vol.  IV,  pp.  609,  622. 

4  It  is  interesting  to  note  that  the  chief  arguments  in  the  series  of  cases  be- 
ginning with  the  Muller  case  were  made  by  an  amicus  curiae,  Mr.  Louis  D. 
Brandeis,  in  behalf  of  the  National  Consumers'  League. 

5New  York  Laws,  1913,  chap.  442,  p.  919- 

6  See  Harvard  Law  Review,  Vol.  XXVIII,  p.  790. 


UK 


V  il 


634       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of  some  machinery  by  which  knowledge  of  the  facts,  which  are  the 
foundation  of  the  legal  judgment,  may  be  at  the  service  of  the  courts 
as  a  regular  form  of  the  judicial  process.  This  need  has  been  voiced 
alike  by  jurists  and  judges/  Once  the  need  shall  be  felt  as  the  com- 
mon longing  of  the  profession,  the  inventive  powers  of  our  law  will 
find  the  means  for  its  satisfaction. 

Felix  Frankfurter 

Harvard  Law  School 

1  Professor  Roscoe  Pound,  in  "Legislation  as  a  Social  Function,"  Publica- 
tions American  Sociological  Society,  Vol.  VII,  pp.  148,  161,  says:  "In  the  im- 
mediate past  the  social  facts  required  for  the  exercise  of  the  judicial  function  of 
lawmaking  have  been  arrived  at  by  means  which  may  fairly  be  called  mechanical. 
It  is  not  one  of  the  least  problems  of  the  sociological  jurist  to  discover  a 
rational  mode  of  advising  the  court  of  facts  of  which  it  is  supposed  to  take  judi- 
cial notice."  So  (in  dealing  with  a  somewhat  similar  problem)  Judge  Learned 
Hand,  in  Parke  Davis  &  Co.  v.  Mulford  &  Co.,  189  Fed.  95,  115  :  "How  long  we 
shall  continue  to  blunder  along  without  the  aid  of  unpartisan  and  authoritative 
scientific  assistance  in  the  administration  of  justice,  no  one  knows;  but  all  fair 
persons  not  conventionalized  by  provincial  legal  habits  of  mind  ought,  I  should 
think,  unite  to  effect  some  such  advance."  Cf.  also  Steenerson  v.  Great  North- 
ern Ry.,  69  Minn.  353,  377,  72  N.  W.  713.  7i6  (1897). 


XXXIX 

COLLECTIVE  BARGAINING  BEFORE  THE 
SUPREME  COURT  ^ 

IN  THREE  important  cases  a  majority  of  the  United  States  Su- 
preme Court  has  thwarted  efforts  of  labor  unions  to  increase 
their  numbers.  In  all  three  there  was  vigorous  dissent.  All  three 
were  opposed  to  the  judgment  of  the  court  below.  The  first  two 
found  statutes  wanting  in  the  requirements  of  due  process  of  law. 
Adair  v.  United  States^  annulled  an  act  of  Congress  which  prohibited 
interstate  carriers  from  discharging  an  employee  because  of  his 
membership  in  a  labor  union.  Coppage  v.  Kansas^  declared  invalid 
a  state  law  which  forbade  any  employer  to  require  of  employees  or 
of  persons  seeking  employment  an  agreement  not  to  become  or 
remain  a  member  of  a  labor  union.  The  third  decision  is  Hitchman 
Coal  and  Coke  Company  v.  Mitchell  et  al.,^  handed  down  last  De- 
cember. It  deals  with  a  situation  created  by  the  type  of  agreement 
which  Kansas  sought  unsuccessfully  to  forbid.  Officers  of  a  labor 
union  were  restrained  by  injunction  from  securing  secret  promises 
to  join  the  union  from  employees  who  had  agreed  to  relinquish  their 
employment  in  case  they  became  members. 

Each  of  these  decisions  was  rendered  in  the  name  of  freedom  and 
liberty.  But  since  each  dealt  with  conflicting  interests,  each  neces- 
sarily involved  interfering  with  liberty  as  well  as  protecting  it.  The 
majority  judges  of  the  Supreme  Court  must  have  thought  that  the 
liberty  they  safeguarded  was  for  some  reason  entitled  to  more  con- 
sideration than  the  liberty  they  curtailed.  And  the  minority  and  the 
judges  below  must  have  held  contrary  views.  The  importance  of  the 
decisions  and  of  the  court  which  rendered  them  may  make  it  profit- 
able to  review  the  various  opinions  and  try  to  arrange  the  controlling 

iFrom  Political  Science  Quarterly,  Vol.  XXXIII  (1918),  pp.  396-429. 

2208  U.S.  161  (1908). 

3236  U.S.  I  (1915).  *245  U.S.  232  (1917). 

635 


\ 


636       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

reasons  for  the  divergent  views.  In  so  far  as  the  opinions  do  not  lend 
themselves  to  this  purpose  an  endeavor  will  be  made  to  indicate 
the  fact.  It  not  infrequently  happens  that  a  judicial  opinion,  like 
the  arguments  of  counsel,  starts  from  a  selected  premise  which  has 
in  it  the  seeds  of  a  desired  result,  and  neglects  to  weigh  that  premise 
in  even  scales  against  competing  premises  which  are  equally  signifi- 
cant but  which  bear  other  fruit. 

Only  four  of  the  judges  sat  in  all  three  cases.  Of  these  Chief 
Justice  White  was  consistently  with  the  majority,  and  Mr.  Justice 
Holmes  with  the  minority.  Mr.  Justice  McKenna  was  with  the 
majority  in  the  Coppage  case  and  the  Hitchman  case,  and  with  the 
minority  in  the  Adair  case.  Mr.  Justice  Day  dissented  in  the  Cop- 
page  case  and  concurred  in  the  other  two.  Justices  Pitney,  Van 
Devanter  and  McReynolds  sat  in  the  Coppage  case  and  the  Hitchman 
case  and  concurred  in  both.  With  them  in  the  Coppage  case  was 
Mr.  Justice  Lamar ;  against  them,  Mr.  Justice  Hughes.  Chief  Jus- 
tice Fuller  and  Justices  Harlan,  Peckham,  and  Brewer  completed 
the  majority  in  the  Adair  case;  and  Justices  Brandeis  and  Clarke, 
the  minority  in  the  Hitchman  case. 


The  Adair  case  involved  no  dispute  as  to  the  facts,  as  the  respond- 
ent by  demurring  to  the  indictment  confessed  that  he  had  discharged 
an  employee  of  an  interstate  railroad  because  of  his  membership  in 
a  labor  union.  The  sole  issue  before  the  Court  was  the  constitution- 
ality of  the  statute  forbidding  such  discharge.  And  the  opinion  of 
Mr.  Justice  Harlan  maintained  its  unconstitutionality  by  asserting  it. 

Adair  was  an  agent  of  the  carrier.  It  was  his  right,  says  the 
learned  justice,  "  and  that  right  inhered  in  his  personal  liberty,  and 
was  also  a  right  of  property,  to  ser\'e  his  employer  as  best  he  could, 
so  long  as  he  did  nothing  that  was  reasonably  forbidden  by  law  as 
injurious  to  the  public  interests."  This  seems  a  prelude  to  a  con- 
sideration of  the  question  of  reasonableness.  But  we  are  not  thus 
favored.  Instead,  we  are  informed  again  that  "it  was  the  right  of 
the  defendant  to  prescribe  the  terms  upon  which  the  services  of 
Coppage  [the  employee]  would  be  accepted,  and  it  was  the  right 
of  Coppage  to  become  or  not,  as  he  chose,  an  employee  of  the 
railroad  company  upon  the  terms  offered  him." 


COLLECTIVE  BARGAINING 


t>37 


This  describes  the  legal  situation  before  the  passage  of  the  statute. 
The  parties  were  at  liberty  to  bargain  as  they  pleased  about  the 
affiliation  of  the  employee  with  a  union.  But  what  we  need  to  know 
is  why  the  legal  situation  created  or  sanctioned  by  the  common  law 
cannot  be  changed  by  statute.  We  do  not  gain  light  on  this  point 
from  any  recital  of  the  rights  of  the  parties  at  common  law,  however 
oft  repeated.  Mr.  Justice  Harlan  quotes  a  statement  from  Cooley 
that  "  it  is  a  part  of  every  man's  civil  rights  that  he  be  left  at  liberty 
to  refuse  business  relations  with  any  person  whomsoever,  whether 
the  refusal  rests  upon  reason,  or  is  the  result  of  whim,  caprice,  prej- 
udice, or  malice."  But  this  is  from  a  treatise  on  torts,  and  is  evi- 
dently intended  to  mean  that  a  man  is  not  liable  in  tort  for  refusing 
to  hire  another  or  to  work  for  another.  It  does  not  throw  light  on 
the  question  whether  a  new  statutory  arrangement  is  reasonable 
enough  to  be  constitutional. 

The  succeeding  paragraph  in  the  opinion  takes  us  no  further  in 
our  quest.  It  cites  Lochner  v.  New  York,^  and  says  that  all  the 
Court  were  agreed  "as  to  the  general  proposition  that  there  is  a 
liberty  of  contract  that  cannot  be  unreasonably  interfered  with  by 
legislation."  Next  follows  the  concession  that  the  "right  of  liberty" 
is  subject  "to  such  reasonable  restraints  as  the  common  good  or 
general  welfare  may  require."  But  this  is  succeeded  not  by  a  dis- 
cussion of  the  question  of  reasonableness  but  by  a  neglect  of  it. 
Note  the  significant  silence  on  the  controlling  issue:  "...  it  is 
not  within  the  functions  of  government — at  least  in  the  absence  of 
contract  between  the  parties— to  compel  any  person,  in  the  course 
of  his  business,  and  against  his  will,  to  accept  or  retain  the  personal 
services  of  another."  After  reiterating  again  the  common-law  rights 
of  the  employer  and  of  the  employee  the  opinion  continues : 

In  all  such  particulars  the  employer  and  the  employee  have  equal- 
ity of  right,  and  any  legislation  that  disturbs  that  equality  is  an 
arbitrary  interference  with  the  liberty  of  contract  which  no  govern- 
ment can  legally  justify  in  a  free  land. 

There  is  more  to  the  same  effect.    Summing  it  up,  the  statute  is  un- 
constitutional because  it  is  unconstitutional. 

It  is  not  surprising  that  such  an  avoidance  of  the  question  of 
reasonableness  prompts  Mr.  Justice  McKenna  to  open  his  dissent 

1198  U.S.  45  (190S). 


1 


638       TRADE  UNIONISM  AND  LABOR  PROBLEMS 
by  saying,  "The  opinion  of  the  Court  proceeds  upon  somewhat  nar- 
row  hnes  and  e.ther  omits  or  does  not  give  adequate  prominence 
to  the  considerations  which,  I  think,  are  determinative  of  the  ques- 
tions m  the  case."   And  later  he  suggests  that  an  inquiry  be  made 

abstract  "''"'^°''  °^  *'  ''^''''''°"  ""''"^°"*  ^'''^^  "^°"'  '"^  'he 

This  purpose  Mr.  Justice  McKenna  finds  in  the  other  provisions 

of  the  statute  setting  forth  a  plan  of  arbitration  to  prevent  the 

employed.    The  unions  among  railroad  employees,  he  says,  exist 
and  are  a  fact  to  be  reckoned  with.   They  create  a  unity  ;mo^ 
employees  which  may  be  an  obstacle  or  an   aid   to  arbitration 
Congress  sought  to  make  this  unity  an  aid  in  the  settlement  of 
labor  disputes    The  requirement  is  therefore  in  the  public  interest 
It  IS  imposed  only  on  those  engaged  in  a  public-service   enter- 

W^th  th^-r  'fT  '°  '°"'''"  '"  '"^  '"'"^^'  °f  the  public. 
With  the  rights  of  those  engaged  in  private  business  "we  are  not 
concerned." 

Mr.  Justice  McKenna  therefore  finds  the  restriction  on  the  liberty 
of  the  carriers  a  reasonable  one,  because,  accepting  conditions  a^ 
they  are,  ,t  will  tend  to  prevent  strikes.    Mr.  Justice  Harlan  dis 
misses  this  alleged  justification  in  a  somewhat  roundabout  way    He 
enters  upon  the  question  in  order  to  discover  whether  the  act  is  a 
regulation  of  interstate  commerce.   This  is  in   response  to  some 
argument  which  he  calls  a  suggestion  that  the  act  "can  be  referred 
o  the  power  of  Congress  to  regulate  interstate  commerce,  w  th  ut 

thf  F  f  °.  7  'T"°"  °'  P'^°"^'  '"'"'y  °^  "ght  of  prope  ty  unde 
the  Fifth  Amendment."  If  the  argument  was  put  in  this  way  i 
confused  two  d  st  net  mipctmnc     ti,„       •  •  .  ^' 

it  savs  UiJfh^lZ    ''"*'"°"'-    ^^^  0P">'0"  recognizes  this  when 
It  says  later  that  the  power  over  commerce  "cannot  be  exerted  in 
eolation  of  any  fundamental  right  secured  by  other  provisions  o 
the  Const,  ution."   And  if  the  act  is  not  a  regulation  of  interstate 
commerce  it  is  unconstitutional,  even  if  it  does  not  also  violate  the 
F  f  h  Amendment.    So  that  the  majority,  by  holding  that  the  objects 
of  the  sta  ute  are  not  within  the  purview  of  the  commerce  power 
avoids  explicit  analysis  of  the  reasons  adduced  by  the  minoriL  for 
the  reasonableness  of  its  interference  with  liberty. 


I 


COLLECTIVE  BARGAINING 


639 


Mr.  Justice  Harlan  prefaces  his  consideration  of  the  commerce 
question  by  saying : 

Manifestly,  any  rule  prescribed  for  the  conduct  of  interstate  com- 
merce, in  order  to  be  within  the  competency  of  Congress  under  its 
power  to  regulate  commerce  among  the  states,  must  have  some 
real  or  substantial  relation  to  or  connection  with  the  commerce 
regulated. 

Then  follows  the  rhetorical  question,  ''But  what  possible  legal  or 
logical  connection  is  there  between  an  employee's  membership  in  a 
labor  organization  and  the  carrying  on  of  interstate  commerce?" 
In  first  analysis,  of  course,  the  connection  is  factual.    Whether  it  is 
also  logical  depends  upon  the  logician ;  whether  it  is  legal,  upon  the 
judge.    Mr.  Justice  Harlan  finds  no  link  between  labor  unions  and 
commerce,  because  "  it  is  the  employee  as  a  man,  and  not  as  a  mem- 
ber of  a  labor  organization,  who  labors  in  the  service  of  an  interstate 
carrier."    "Surely,"  he  says,  "those  associations,  as  labor  organiza- 
tions, have  nothing  to  do  with  interstate  commerce."  ^    The  argu- 
ment to  the  contrary  he  regards  as  based  upon  the  assumption  that 
"members  of  labor  organizations  would,  by  illegal  or  violent  meas- 
ures,  interrupt   or   impair   the   freedom   of   commerce   among   the 
states."   And  of  such  assumptions  he  says :    "  We  will  not  indulge 
in  any  such  conjectures,  nor  make  them,  in  whole  or  in  part,  the 
basis  of  our  decision.   We  could  not  do  so  consistently  with  the 
respect  due  to  a  coordinate  department  of  the  government." 

Mr.  Justice  McKenna's  respect  for  Congress  takes  a  different  form. 
He  sees  that  the  power  of  labor  unions  "may  be  effectively  exercised 
without  violence  or  illegality,"  and  he  quotes  from  a  report  of  the 
Senate  Committee  to  show  that  the  legislation  was  based  not  on 
conjecture  but  on  experience.  Of  the  argument  of  the  majority  he 
says,  "Neither  the  supposition  nor  the  disrespect  is  necessary,  and, 

lit  is  interesting  to  compare  a  statement  of  Mr.  Justice  Pitney  on  behalf  of 
the  majority  in  the  Coppage  case,  in  which  he  says  that  "it  cannot  be  judicially 
declared  that  membership  in  such  an  organization  has  no  relation  to  a  member  s 
duty  to  his  employer"  (236  U.S.  i,  19).  In  the  Coppage  case  it  was  the 
argument  in  favor  of  the  statute  which  urged  that  "membership  in  a  labor 
organization  is  the  'personal  and  private  affair'  of  the  employee." 

In  sustaining  the  Adamson  Law  in  Wilson  v.  New,  243  U.S.  332  (191 7),  a 
majority  of  the  Supreme  Court  in  effect  discountenanced  the  application  of  the 
commerce  clause  adopted  by  the  majority  in  the  Adair  case. 


I 


I 


ill    ■ 


lit 


640       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

it  may  be  urged,  they  are  no  more  invidious  than  to  impute  to 
Congress  a  careless  or  deliberate  or  purposeless  violation  of  the  con- 
stitutional rights  of  the  carriers." 

Plainly  Mr.  Justice  Harlan  avoids  due  consideration  of  the  justifi- 
cations for  the  restraint  imposed  on  the  carriers.  But  Mr.  Justice 
McKenna  also  fails  to  give  due  weight  to  the  burden  of  that  restraint 
upon  them.  The  act,  he  says,  restrains  nothing  "which  is  of  any 
material  interest  to  the  carrier."  He  assumes  that  the  discharge  of 
an  employee  because  of  membership  in  a  union  is  "  the  exercise  of 
mere  whim  or  caprice,"  or  at  any  rate  that  it  may  be,  and  that  "this 
is  the  liberty  which  is  attempted  to  be  vindicated  as  the  constitutional 
right  of  the  carrier."  And  on  this  assumption  he  comments  elo- 
quently; "Liberty  is  an  attractive  theme,  but  the  liberty  which  is 
exercised  in  sheer  antipathy  does  not  plead  strongly  for  recognition." 

Mr.  Justice  Holmes  looks  deeper.  In  a  separate  dissent  he  says 
that  "the  section  is,  in  substance,  a  very  limited  interference  with 
the  freedom  of  contract,  no  more.  It  does  not  require  the  carriers  to 
employ  anyone.  It  does  not  forbid  them  to  refuse  to  employ  anyone, 
for  any  reason  they  deem  good."  And  he  puts  his  finger  on  the 
artificiality  of  the  individualistic  approach  to  the  problem  by  adding, 
".  .  .  even  where  the  notion  of  a  choice  of  persons  is  a  fiction  and 
wholesale  employment  is  necessary  upon  general  principles  that  it 
might  be  proper  to  control."  The  statute,  he  finds,  "simply  prohibits 
the  more  powerful  party  to  exact  certain  undertakings,  or  to  threaten 
dismissal  or  unjustly  discriminate  on  certain  grounds  against  those 
already  employed."  If  there  is  believed  to  be  an  important  ground 
for  the  restraint,  "  the  Constitution  does  not  forbid  it,  whether  this 
Court  agrees  or  disagrees  with  the  policy  pursued."  Mr.  Justice 
Holmes  does  not  confine  his  sanction  to  the  object  of  preventing 
strikes.  Though  he  thinks  that  laboring  men  are  apt  to  attribute  to 
unions  advantages  "that  really  are  due  to  economic  conditions  of  a 
wider  and  deeper  kind,"  he  says  that  he  "could  not  pronounce  it  un- 
warranted if  Congress  should  decide  that  to  foster  a  strong  union 
was  for  the  best  interest,  not  only  of  the  men,  but  of  the  railroads 
and  the  country  at  large."  And  his  conclusion,  which  he  puts  at  the 
beginning  of  his  opinion,  is  stated  as  follows :  "  I  also  think  that 
the  statute  is  constitutional,  and,  but  for  the  decision  of  my  brethren, 
I  should  have  felt  pretty  clear  about  it." 


COLLECTIVE  BARGAINING 


641 


So  much  for  the  arguments  of  the  judges.  Mr.  Justice  Holmes 
sees  the  issue  as  one  of  policy  which  it  is  for  Congress  to  decide. 
The  majority  find  some  eternal  right  of  the  carrier  to  be  left 
alone,  against  which  Congress  beats  in  vain.  They  build  this  right  on 
the  common-law  right  of  the  carrier  to  be  immune  from  damages  if  it 
dismissed  an  employee  because  he  was  a  member  of  a  union.  But 
this  common-law  right  was  a  judicial  creation  with  respect  to  an 
issue  between  man  and  man.  The  issue  in  the  Adair  case  is  one 
between  man  and  government.  The  new  right  of  the  carrier  discov- 
ered by  the  Adair  case  is  wholly  different  from  that  which  it  had  at 
common  law.  An  immunity  against  an  individual  has  been  enlarged 
into  an  immunity  against  the  government.  Yet  the  Court  seems  to 
think  that  it  is  merely  protecting  an  old  right  and  not  creating 
a  new  one.    Thus  it  avoids  giving  any  substantial  reason  for  its 

decision. 

The  majority  recognizes  that  the  issue  before  the  Court  is  one  of 
reasonableness.    The  merit  of  its  opinion  depends,  therefore,  upon  its 
discussion  of  that  issue.   Legislatures  are  fortunate  in  not  being 
called  upon  to  give  reasons  for  the  law  they  make.    Courts  are  under 
a  duty  to  give  weighty  and  specific  reasons  before  they  unmake  the 
law  made  by  the  legislature.    They  may  not  inappropriately  be  held 
subject  to  the  canon  that  the  vigorous  assertion  of  a  conclusion  is 
not  the  giving  of  a  reason  for  it.    Judged  by  this  canon,  the  major- 
ity opinion  in  the  Adair  case  is  sadly  wanting.    Its  declaration  that 
it  is  not  within  the  functions  of  government  to  compel  a  person 
against  his  will  to  retain  the  services  of  another  is  beside  the  point, 
because  Congress  did  not  compel  the  carrier  to  retain  the  services 
of  any  of  its  employees.    There  is  a  wide  difference  between  prohibit- 
ing discharge  for  a  single,  specified  reason  and  prohibiting  discharge 
altogether.    The  Court  cannot  convince  us  of  the  unreasonableness 
of  what  Congress  did  by  telling  us  that  it  is  not  within  the  func- 
tions of  government  to  do  something  much  more  drastic.    It  does 
not  enlighten  us  on  the  question  of  reasonableness  by  the  rhetorical 
fiat  that  "the  employer  and  the  employee  have  equality  of  right,  and 
any  legislation  that  disturbs  that  equality  is  an  arbitrary  interfer- 
ence with  liberty  of  contract  which  no  government  can  legally  justify 
in  a  free  land."    Yet  it  is  on  this  fiat  that  the  decision  rests,  and  not 
on  anything  that  can  be  dignified  with  the  title  of  a  reason. 


^1- 


642       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

II 

This  question  of  the  disturbance  of  the  equality  between  employer 
and  employed  receives  further  discussion  in  the  opinions  in  the 
Coppage  case.  The  majority  in  that  case  insist  that  a  statute  which 
forbids  an  employer  to  require  of  a  laborer,  as  a  condition  of  obtain- 
ing or  remaining  in  employment,  an  agreement  not  to  become  or  to 
remain  a  member  of  a  labor  union  is  as  vicious  as  one  which  forbids 
dismissal  because  of  membership  in  a  union.  If  the  employer  must 
remain  free  to  discharge  an  employee  for  any  reason  that  seems  to 
him  good,  he  must  be  permitted  to  announce  in  advance  what  reasons 
he  will  deem  sufficient  for  discharge.  "Granted  the  equal  freedom 
of  both  parties  to  the  contract  of  employment,  has  not  each  party 
the  right  to  stipulate  upon  what  terms  only  he  will  consent  to  the 
inception,  or  to  the  continuance,  of  that  relationship?" 

Mr.  Justice  Holmes,  in  a  brief  dissent,  did  not  seek  to  distinguish 
the  problem  before  the  Court  from  that  involved  in  the  Adair  case. 
He  thought  that  the  Adair  case  should  be  overruled.  But  Mr.  Jus- 
tice Day,  who  concurred  in  the  Adair  case,  distinguishes  it  from  the 
case  in  hand,  in  which  he  dissents.   His  reasons  are  as  follows : 

There  is  a  real,  and  not  a  fanciful,  distinction  between  the  exer- 
cise of  the  right  to  discharge  at  will  and  the  imposition  of  a  require- 
ment that  the  employee,  as  a  condition  of  employment,  shall  make  a 
particular  agreement  to  forego  a  legal  right.  The  agreement  may  be, 
or  may  be  declared  to  be,  against  public  policy,  although  the  right  of 
discharge  remains.  When  a  man  is  discharged,  the  employer  exer- 
cises his  right  to  declare  such  action  necessary  because  of  the  exigen- 
cies of  his  business,  or  as  the  result  of  his  judgment  for  other  reasons 
sufficient  to  himself.  When  he  makes  a  stipulation  of  the  character 
here  involved  essential  to  future  employment,  he  is  not  exercising  a 
right  to  discharge,  and  may  not  wish  to  discharge  the  employee 
when,  at  a  subsequent  time,  the  prohibited  act  is  done.  What  is  in 
fact  accomplished  is  that  the  one  engaging  to  work,  who  may  wish  to 
preserve  an  independent  right  of  action,  as  a  condition  of  employment 
is  coerced  to  the  signing  of  such  an  agreement  against  his  will,  per- 
haps impelled  by  the  necessities  of  his  situation. 

In  illustration  of  his  point  Mr.  Justice  Day  refers  to  such  possible 
stipulations  as  that  a  person  seeking  employment  shall  agree  not  to 
resort  to  the  courts  for  redress  in  case  of  disagreement  with  his  em- 
ployer, or  not  to  become  a  member  of  the  National  Guard,  or  not  to 


COLLECTIVE  BARGAINING 


643 


. 


affiliate  with  a  particular  political  party.  The  requirement  of  such 
agreements  in  advance,  he  insists,  is  the  exercise  of  a  wholly 
different  liberty  from  those  of  not  employing  or  of  discharging 
after  employing. 

There  is  a  difference,  of  course.   But  whether  the  difference  is 
sufficient  to  entitle  one  who  dissents  in  the  Coppage  case  to  concur 
in  the  Adair  case  is  more  difficult  to  determine.   Mr.  Justice  Day 
does  not  establish  the  importance  of  his  distinction  by  saying  that 
the  Kansas  statute  "reaches  not  only  the  employed,  but  as  well, 
one  seeking  employment,"  who  "by  signing  such  agreements"  is 
"deprived  of  the  right  of  free  choice  as  to  his  future  conduct."    So 
long  as  the  employee  remains  legally  free  to  quit  his  employment  at 
any  time,  he  may  always  choose  between  joining  a  union  or  keeping 
his  job.    So  far  as  we  can  reason  about  it  the  agreement  would  seem 
to  have  no  wider  direct  results  as  between  employer  and  employee 
than  would  ensue  from  the  announcement  by  the  employer  that 
he  ran  and  would  continue  to  run  a  closed  nonunion  shop.    But 
psychological  considerations  may  enter  in  to  make  a  difference.    Evi- 
dently the  employers  think  that  the  securing  of  the  individual  agree- 
ments at  the  time  of  hiring  is  an  aid  in  their  endeavor  to  avert  the 
pressure  of  collective  bargaining  on  the  part  of  the  men.   And,  as 
will  appear  later  from  the  Hitchman  case,  the  existence  of  a  contract 
between  employer  and  employed  gives  a  weapon  to  the  former 
against  third  parties  who  seek  to  unite  employees  in  a  demand  that 
they  be  retained  as  union  men.    The  majority,  therefore,  do  not  find 
in  the  Adair  case  a  complete  precedent  for  the  Coppage  case.   Never- 
theless, the  major  issue  in  both  cases  is  whether  the  legislature  may 
aid  laborers  in  their  efforts  to  secure  collective  bargaining. 

This  evidently  is  the  way  Mr.  Justice  Holmes  views  it.  In  a  dis- 
sent which  takes  only  a  paragraph  he  says : 

In  present  conditions  a  workman  not  unnaturally  may  believe  that 
only  by  belonging  to  a  union  can  he  secure  a  contract  that  shall  be 
fair  to  him.  If  that  belief,  whether  right  or  wrong,  may  be  held  by  a 
reasonable  man,  it  seems  to  me  that  it  may  be  enforced  by  law  in 
order  to  establish  the  equality  of  position  between  the  parties  in 
which  liberty  of  contract  begins.  Whether  in  the  long  run  it  is  wise 
for  the  workingmen  to  enact  legislation  of  this  sort  is  not  my  con- 
cern, but  I  am  strongly  of  opinion  that  there  is  nothing  in  the  Con- 
stitution of  the  United  States  to  prevent  it.  .  .  . 


11  i 


«* 


K 


n 


644       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Thus  Mr.  Justice  Holmes  regards  the  statute  as  a  promoter  of 
liberty  and  equality.  The  majority  regard  it  as  an  interference  with 
both.  This  is  not  to  say  that  they  disagree  as  to  the  results  the 
law  sought  to  produce.  Their  difference  relates  to  the  characteriza- 
tion of  those  results.  It  goes  to  the  essence  of  what  each  means 
by  liberty  and  equality. 

To  the  minority  liberty  and  equality  mean  something  actual 
and  concrete.  Mr.  Justice  Day  says  of  the  Kansas  statute,  "I 
think  that  the  Act  now  under  consideration,  and  kindred  ones,  are 
intended  to  promote  the  same  liberty  of  action  for  the  employee,  as 
the  employer  confessedly  enjoys."  It  is  a  step  towards  making  them 
equal  in  bargaining  power.  It  prohibits  "coercive  attempts"  on  the 
part  of  employers  to  deprive  employees  "of  the  free  right  of  exer- 
cising privileges  which  are  theirs  within  the  law."  To  the  argument 
of  the  majority  that  there  is  no  element  of  coercion  in  offering  an 
employee  a  choice  between  his  union  and  his  job,  Mr.  Justice  Day 
says  that  this  neglects  the  facts  as  to  the  relative  positions  of  em- 
ployer and  employed.  The  choice  legally  open  to  the  employee  is 
not  actually  open  to  him.  He  cannot  enjoy  his  legal  right  to  be  a 
member  of  a  union  if  he  is  hampered  thereby  in  working  for  his 
living  in  the  occupation  for  which  he  is  best  fitted. 

To  this  the  majority  reply  that  "constitutional  freedom  of  con- 
tract does  not  mean  that  a  party  is  to  be  as  free  after  making  a 
contract  as  before."  By  agreeing  to  work,  the  employee  yields  the  en- 
joyment of  his  legal  right  to  use  his  time  as  he  pleases.  "  Freedom 
of  contract,  from  the  very  nature  of  the  thing,  can  be  enjoyed  only 
by  being  exercised ;  and  each  particular  exercise  of  it  involves  mak- 
ing an  engagement  which,  if  fulfilled,  prevents  for  the  time  any  in- 
consistent course  of  conduct."  While  an  individual  has  a  legal  right 
to  join  a  union,  "  he  has  no  inherent  right  to  do  this  and  still  remain 
in  the  employ  of  one  who  is  unwilling  to  employ  a  union  man." 

This,  of  course,  is  but  to  reiterate  the  common-law  situation. 
The  statute  meant  to  give  the  employee  a  freedom  he  did  not  have 
at  common  law.^    The  minority  says  that  his  ancient  legal  liberty 

iThe  statute  may  be  viewed  as  a  declaration  that  the  legal  right  to  be  a 
member  of  a  union  shall  not  be  subject  to  sale.  Common  law  and  equity  are 
familiar  with  restrictive  covenants  on  one's  future  freedom  of  action  which  are 
denied  jural  recognition.  Restraints  of  one's  future  conduct  connected  with 
earning  a  livelihood  have  always  been  outlawed  when  regarded  as  unreasonable. 


COLLECTIVE  BARGAINING 


645 


was  not  an  actual  liberty,  and  that  it  is  within  the  power  of  the 
state  to  add  to  his  actual  liberty.  In  so  doing  it  cuts  down  the 
legal  liberty  of  the  employer,  but  it  leaves  him  with  an  actual 
liberty  which,  by  reason  of  his  economic  superiority,  is  equal  to  the 
actual  liberty  of  the  employee. 

This  discussion  of  liberty  is  of  value  only  as  it  leads  to  the  issue 
of  equality.  Of  course  no  one  has  actual  liberty  to  use  all  his  legal 
liberty.  He  must  pick  and  choose.  Everyone  is  subject  to  some 
degree  of  economic  coercion.  Mr.  Justice  Day's  statement  that  the 
Kansas  statute  "has  for  its  avowed  purpose  the  protection  of  the 
exercise  of  a  legal  right"  to  join  a  union  is  true  enough  so  far  as  it 
goes.  But  it  has  the  same  incompleteness  which  marks  the  argument 
of  the  majority  that  the  statute  interferes  with  the  legal  right  of 
employers  to  prescribe  the  conditions  on  which  they  will  make  con- 
tracts. The  protection  of  the  common-law  right  of  the  one  is 
gained  only  by  limiting  the  common-law  right  of  the  other.  All  argu- 
ment is  vain  which  confines  itself  to  the  elaboration  of  the  effect  of 
the  statute  on  one  of  these  rights,  disregarding  its  effect  on  the 
other. 

The  common  law  left  the  employee  free  to  join  a  union.  It  left 
the  employer  free  to  decline  to  hire  members  of  a  union.  In  some 
upper  conceptual  chamber  these  two  common-law  liberties  may  dwell 
together  in  amity.  In  actual  life  they  conflict.  The  conflict  had  to 
be  resolved  in  the  course  of  a  struggle  in  which  the  public  interests 
suffered.  If  the  state  is  to  step  in  to  aid  the  public  interest  by  reduc- 
ing the  friction  between  the  parties,  it  must  do  something  more 
than  to  sanction  what  already  exists.  The  minority  is  correct  in  its 
position  that  the  state  has  protected  the  exercise  of  the  legal  liberty 
of  the  employee.  The  majority  is  correct  in  its  assertion  that  the 
state  has  interfered  with  a  previous  legal  liberty  of  employers.  The 
issue  is  whether  the  former  is  a  justification  for  the  latter. 

The  majority,  in  seeking  for  possible  justifications,  find  none. 
Other  interferences  with  liberty  which  have  been  judicially  sanc- 
tioned have  been  "fairly  deemed  necessary  to  secure  some  object 
directly  affecting  the  public  welfare."  But  of  the  statute  in  ques- 
tion, putting  aside  the  question  of  coercion,  Mr.  Justice  Pitney  says : 

.  .  .  there  is  no  object  or  purpose,  expressed  or  implied,  that  is 
claimed  to  have  reference  to  health,  safety,  morals,  or  public  welfare, 


I 


i| 


II 


646       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

beyond  the  supposed  desirability  of  leveling  inequalities  of  for- 
tune by  depriving  one  who  has  property  of  some  part  of  what  is 
characterized  as  his  "financial  independence."  In  short,  an  interfer- 
ence with  the  normal  exercise  of  personal  liberty  and  property  rights 
is  the  primary  object  of  the  statute,  and  not  an  incident  to  the 
advancement  of  the  general  welfare. 

This  is  to  say  that  the  object  of  the  statute  is  to  promote 
equality  of  actual  opportunity,  solely  for  the  sake  of  that  equal- 
ity—a result  which  could  not  promote  the  general  welfare.    More- 
over,  the   Constitution   is   regarded   as   having    been    designed    to 
prevent   the  legislature   from  promoting   equality   of   opportunity. 
Inequality   is   the   necessary   result   of   the   institution   of   private 
property.     "Wherever  the  right  of  private  property   exists   there 
must  and  will  be  inequalities  of  fortune."     It  is  "impossible  to 
uphold  freedom  of  contract  and  the  right  of  private  property  without 
at  the  same  time  recognizing  as  legitimate  those  inequalities  of  for- 
tune that  are  the  necessary  result  of  the  exercise  of  those  rights." 
Since  a  state  may  not  cut  down  the  rights  of  private  property  directly, 
it  "may  not  do  so  indirectly,  as  by  declaring  in  effect  that  the 
public  good  requires  the  removal  of  those  inequalities  that  are  but 
the  normal  and  inevitable  result  of  their  exercise,  and  then  invoking 
the  police  power  in  order  to  remove  the  inequalities,  without  other 
object  in  view." 

Constitutional  liberty  of  contract,  therefore,  is  not  "freedom  of 
action."  It  is  freedom  from  legislative  interference  with  action. 
This  is  freedom  for  employer  and  employee  alike,  even  though  for 
the  employee  it  is  but  the  wraith  of  genuine  freedom.  Equality 
between  employer  and  employee  is  not  approximate  evenness  of  bar- 
gaining position.  It  exists  only  when  both  are  equally  let  alone  by 
the  legislature.  The  state  may  not,  as  Mr.  Justice  Holmes  contends, 
"establish  the  equality  of  position  in  which  liberty  of  contract  be- 
gins." It  must  not  interfere  with  that  inequality  of  position  which 
enables  the  one  with  superior  position  to  drive  a  hard  bargain.  The 
owner  of  property  must  be  guaranteed  an  advantage  in  all  his  deal- 
ings with  those  who  have  less  than  he.  In  the  words  of  Mr.  Justice 
Pitney : 

Indeed,  a  little  reflection  will  show  that  wherever  the  right  of 
private  property  and  the  right  of  free  contract  coexist,  each  party 


COLLECTIVE  BARGAINING 


647 


when  contracting  is  inevitably  more  or  less  influenced  by  the  ques- 
tion whether  he  has  much  property  or  little  or  none ;  for  the  con- 
tract is  made  to  the  very  end  that  each  may  gain  something  he  needs 
or  desires  more  urgently  than  that  which  he  proposes  to  give  in 
exchange. 

To  him  that  hath  shall  be  given  protection  not  only  of  that  which  he 
hath  but  of  every  leverage  which  his  possessions  give  him  in  acquiring 
more.  To  him  that  hath  not  shall  be  given  the  solace  that  he  is 
free  and  unrestrained  by  law  as  to  the  bargains  he  shall  make.  He 
may  be  influenced  as  much  as  he  likes  by  the  fact  that  he  has  little 
property  or  none.    He  lives  in  a  land  of  freedom  and  equality. 

This  is  where  we  should  arrive  by  uniting  an  absolute  conception 
of  liberty  of  contract  with  an  absolute  conception  of  property,  and 
then  regarding  the  marriage  as  indissoluble.  Of  course  no  one  means 
to  carry  the  sanctity  of  inequality  so  far.    Otherwise  all  antitrust 
laws  would  be  unconstitutional.    For  they  deprive  those  who  have 
superior  position  from  using  that  position  as  a  leverage  to  improve  it 
still  further.  They  promote  actual  equality  by  restraining  the  strong 
for  the  sake  of  the  weak.   It  is  quite  as  nearly  correct  to  say  they 
have  no  other  object  in  view  as  it  is  to  say  that  the  Kansas  statute 
has  no  other  object  in  view.   Whether  in  either  case  "an  interfer- 
ence with  the  normal   exercise  of  personal  liberty   and  property 
rights"  is  "the  primary  object  of  the  statute"  or  is  "an  incident  to 
the  advancement  of  the  general  welfare"  depends  upon  a  judgment 
whether  the  primary  results  of  the  interference  conduce  to  the  gen- 
eral welfare.    It  is  equally  possible  arbitrarily  to  stigmatize  either 
interference  as  a  primary  object  and  not  a  means  to  something  else. 
Each   necessarily   results   in   something   else.    Each   involves   "the 
supposed  desirability"  of  "leveling  inequalities  of  fortune,"  in  the 
sense  that  each  seeks  to  enhance  the  purchasing  power  of  a  large 
group  of  the  public  to  the  consequent  diminution  of  the  purchasing 
power  of  another  group.    Both  deal  with  the  distribution  of  what  is 
to  be  created  in  the  future.    Neither  involves  redivision  of  commod- 
ities now  possessed.    ]\Ir.  Justice  Day  draws  the  parallel  as  follows: 

Wherein  is  the  right  of  the  employer  to  insert  this  stipulation  in 
the  agreement  any  more  sacred  than  his  right  to  keep  up  prices^ 
He  may  think  it  quite  as  essential  to  his  "financial  independence," 
and  so  in  truth  it  may  be  if  he  alone  is  to  be  considered.    But  it  is 


m 


P 


f-;  il 


648       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

too  late  to  deny  that  the  legislative  power  reaches  such  a  case.  It 
would  be  difficult  to  select  any  subject  more  intimately  related  to 
good  order  and  the  security  of  the  community  than  that  under  consid- 
eration— whether  one  takes  the  view  that  labor  organizations  are 
advantageous  or  the  reverse.  It  is  certainly  as  much  a  matter  for 
legislative  consideration  and  action  as  contracts  in  restraint  of  trade. 

Good  order  and  the  security  of  the  community — these  are  the 
justifications  w^hich  Mr.  Justice  Day  and  Mr.  Justice  Hughes  find 
for  the  statute.  This  is  to  be  attained  by  preventing  what  is  in  fact 
coercion,  though  it  be  a  kind  of  coercion  not  forbidden  by  the  com- 
mon law.  It  is  to  be  gained  by  substituting  an  actual  equality  for 
an  artificial  equaHty,  or,  as  Mr.  Justice  Holmes  puts  it,  by  establish- 
ing the  equality  of  position  between  the  parties  in  which  liberty  of 
contract  begins.  "Good  order  and  the  security  of  the  community" 
are  certainly  worthy  objects  of  legislative  endeavor.  But  they  are 
also  vague  phrases  to  conjure  with.  They  are  slogans  rather  than 
reasons.  They  help  no  more  in  debate  than  does  the  phrase  "  general 
welfare."  Both  the  majority  and  the  minority  in  the  Coppage  case 
agree  that  if  the  statute  under  consideration  promotes  the  general 
welfare,  it  is  constitutional.  The  majority  see  that  assistance  to  col- 
lective bargaining  has  the  evil  of  leveling  inequality,  and  they  see 
nothing  more.  The  minority  hold  inequality  less  precious.  And  so 
we  are  left  with  only  the  disagreement  as  to  what  constitutes  the 
general  welfare  and  what  is  a  legitimate  promotion  of  that  welfare. 

Those  who  are  disheartened  at  finding  that  all  the  competing 
reasoning,  or  arguing,  leads  but  to  a  blind  alley  may  find  sympathy, 
if  not  solace,  in  a  statement  made  by  Mr.  Justice  Holmes  when  chief 
justice  of  Massachusetts.  In  his  dissenting  opinion  in  Vegalahn  v. 
Guntner,^  which  he  incorporates  by  reference  in  his  dissent  in  the 
Coppage  case,  he  says : 

It  is  on  the  question  of  what  shall  amount  to  a  justification,  and 
more  especially  on  the  nature  of  the  considerations  which  really  deter- 
mine or  ought  to  determine  the  answer  to  that  question,  that  judicial 
reasoning  seems  to  me  often  to  be  inadequate.  The  true  grounds  of 
decision  are  considerations  of  policy  and  of  social  advantage,  and  it 
is  vain  to  suppose  that  solutions  can  be  attained  merely  by  logic 
and  general  propositions  of  law  which  nobody  disputes.  Propositions 
as  to  public  policy  rarely  are  unanimously  accepted,  and  still  more 

1167  Mass.  92  (1896). 


COLLECTIVE  BARGAINING 


649 


rarely,  if  ever,  are  capable  of  unanswerable  proof.  They  require  a 
special  training  to  enable  anyone  even  to  form  an  intelligent  opinion 
about  them.^ 

If  the  opinions  in  the  Coppage  case  do  not  deal  satisfactorily  with 
the  determining  issue,  they  are  not  alone  in  their  deficiencies.  Like 
many  other  judicial  opinions  they  use  methods  unsuited  to  the  task 
in  hand.  But  though  they  give  us  little  or  no  guidance  in  forming 
an  intelligent  judgment  on  the  merits  of  the  legislation  under  review, 
they  afford  interesting  evidence  of  the  methods  by  which  constitu- 
tional limitations  are  actually  interpreted  and  applied. 

iln  the  opinion  from  which  this  is  taken  Chief  Justice  Holmes  contended 
that  one  group  of  laborers  were  justified  in  promoting  their  own  advantage  by 
seeking  to  dissuade  another  group  from  continuing  in  the  service  of  an  employer 
at  the  existing  scale  of  wages.    In  Plant  v.  Woods,  176  Mass.  402   (1900),  to 
which  Mr.  Justice  Holmes  also  refers  in  his  dissent  in  the  Coppage  case,  he 
contended  that  members  of  one  labor  union  were  justified  in  seeking  to  compel 
members  of  another  union  to  desert  it  and  join  with  them,  and  as  a  means  to 
this  end  to  threaten  strikes  and  boycotts.    His  approach  to  the  problems  may 
be  indicated  by  two  quotations.    In  the  Guntner  case  he  says :   "  I  have  seen  the 
suggestion  made  that  the  conflict  between  employers  and  employed  was  not 
competition.    But  I  venture  to  assume  that  none  of  my  brethren  would  rely  on 
that  suggestion.    If  the  policy  on  which  our  law  is  founded  is  too  narrowly 
expressed  in   the   term  'free   competition,'   we   may   substitute   'free   struggle 
for  life.'     Certainly   the  policy   is  not  limited   to   struggles  between   persons 
of  the  same  class,  competing  for  the  same   end.     It  applies  to  all  conflicts 
of  temporal  interests."    And  he  closes  his  dissent  in  Plant  v.  Woods  as  fol- 
lows:  "Although  this  is  not  the  place  for  extended  economic  discussion,  and 
although   the  law  may  not   always   reach   ultimate   economic   conceptions,   I 
think  it  well  to  add  that  I  cherish  no  illusions  as  to  the  meaning  and  effect  of 
strikes.    While  I  think  the  strike  a  lawful  instrument  in  the  universal  struggle 
of  life,  I  think  it  pure  phantasy  to  suppose  that  there  is  a  body  of  capital  of 
which  'labor  as  a  whole  secures  a  larger  share  by  that  means.    The  annual  prod- 
uct, subject  to  an  infinitesimal  deduction  for  the  luxuries  of  the  few,  is  directed 
to  consumption  by  the  multitude,  and  is  consumed  by  the  multitude,  always. 
Organization  and  strikes  may  get  a  larger  share  for  the  members  of  an  organi- 
zation, but,  if  they  do,  they  get  it  at  the  expense  of  the  less  organized  and  less 
powerful  portion  of  the  laboring  mass.    They  do  not  create  something  out  of 
nothing.   It  is  only  by  divesting  our  minds  of  questions  of  ownership  and  other 
machinery  of  distribution,  and  by  lookmg  solely  at  the  question  of  consumption 
—  asking  ourselves  what  is  the  annual  product,  who  consumes  it,  and  what 
changes  would  or  could  we  make— that  we  can  keep  in  the  world  of  realities. 
But,  subject  to  the  qualifications  which  I  have  expressed,  I  think  it  lawful  for 
a  body  of  workmen  to  try  by  combination  to  get  more  than  they  are  now 
getting,  although  they  do  it  at  the  expense  of  their  fellows,  and  to  that  end 
to  strengthen  their  union  by  the  boycott  and  the  strike." 


*i,w*-.-  "'^.-*'«'*fc„ 


650       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  Kansas  statute  deprived  employers  of  a  liberty  which  they 
were  allowed  by  common  law.  But  the  Constitution  does  not  un- 
qualifiedly forbid  the  taking  of  liberty.  It  forbids  it  only  when  the 
taking  is  without  due  process  of  law.  And  the  meaning  of  due  proc- 
ess is  not  hinted  at.  It  has  been  left  for  the  courts  to  work  out.  In 
so  far  as  the  clause  has  become  a  criterion  of  the  validity  of  legis- 
lative objects,  the  issue  is  always  what  constitutes  an  adequate  justi- 
fication for  the  taking  in  question.  It  is  not  logic  nor  the  language 
of  the  Constitution  which  declares  that  the  promotion  of  the  liberty 
of  the  laborer  to  be  a  member  of  a  union  is  not  a  legitimate  legisla- 
tive object.  It  is  a  judgment,  conscious  or  unconscious  on  a  ques- 
tion of  policy.  The  issue  in  the  Coppage  case  was  one  of  policy, 
and  all  the  competing  interpretations  of  the  terms  ''liberty"  and 
"  equality  "  cannot  disguise  the  fact. 

In  deciding  constitutional  questions  which  turn  on  issues  of 
policy,  courts  are  under  a  recognized  duty  to  exclude,  so  far  as  is 
humanly  possible,  their  personal  preferences  and  aversions  and  to 
sustain  a  statute  unless  they  find  it  clearly  condemned  by  the 
Constitution.  It  is  idle  to  say  that  courts  never  substitute  their 
views  of  policy  for  those  of  the  legislature,  for  minorities  have  too 
often  charged  majorities  with  such  substitution.  But  it  is  to  be 
assumed  that  such  majorities  firmly  believe  their  views  of  policy  em- 
bedded in  the  Constitution  and  drawn  therefrom.  The  assumption 
is  made  easier  by  the  fact  that  not  a  few  of  us  identify  our  ideas 
of  what  is  good  and  fair  with  something  greater  than  ourselves.  The 
identification  is  usually  incapable  of  rigorous  proof.  And  so  it  is 
with  the  determination  of  many  constitutional  questions  by  the  Su- 
preme Court.  The  instrument  appealed  to  for  an  answer  to  the  par- 
ticular question  is  silent  thereon.  The  policy  which  the  judges  refer 
to  the  Constitution  is  connected  therewith  only  by  inference  or  con- 
jecture. And  from  the  processes  of  judicial  inference  it  is  often 
difficult  for  the  judge  to  exclude  his  individual  predilections. 

The  inadequacy  of  the  reasoning  in  many  constitutional  opinions, 
to  which  Mr.  Justice  Holmes  refers,  drives  those  who  seek  to  under- 
stand the  actual  working  of  our  institutions  of  government  to  look 
beyond  that  reasoning.  The  explanation  of  the  decisions  not  infre- 
quently depends  in  part  upon  the  social  philosophy  of  the  judges 
and  in  part  upon  their  psychology.    Some  judges  succeed  fairly 


COLLECTIVE  BARGAINING 


651 


easily  in  disregarding  their  personal  views  of  policy  and  in  sustaining 
statutes  for  which  as  legislators  they  would  not  have  voted.  Others 
find  the  task  more  difficult,  possibly  because  their  predilections  are 
stronger,  possibly  because  they  are  less  conscious  of  the  considera- 
tions that  press  to  play  a  part  in  their  decisions.  Difficult  as  it  is 
to  tell  just  what  weight  these  factors  have  in  the  development  of 
our  constitutional  law,  it  is  impossible  to  exclude  them  entirely.  We 
know  pretty  clearly  the  contrast  between  Marshall  and  Taney.  On 
some  important  questions  it  is  not  difficult  to  prophesy  accurately 
in  advance  how  the  last  three  judges  appointed  to  the  bench  will 
align  themselves.  With  others  the  task  is  more  difficult.  But  the 
fact  that  considerations  which  may  influence  decisions  elude  discovery 
does  not  negative  their  presence  or  their  power.  Whenever  judicial 
opinions  must  be  adjudged  logically  bankrupt,  and  the  bankruptcy 
is  recognized  hy  dissenting  colleagues,  we  may  feel  insecure  in  dis- 
missing as  unimportant  the  relation  between  the  social  outlook  of 
legislators  and  the  social  outlook  of  judges. 

Ill 

The  majority  opinions  in  the  Adair  case  and  the  Coppage  case 
set  forth  clear  and  definite  ideas  of  liberty  and  of  equality.    It  is  of 
the  essence  of  the  liberty  of  employers  that  they  be  free  to  accept 
or  reject  employees  for  any  reason  they  please.    It  is  of  the  essence 
of  the  liberty  of  employees  that  they  be  free  to  join  unions  or  to 
keep  aloof  from  them.    Equal  freedom  for  employers  and  for  em- 
ployees is  the  watchword  of  the  opinions.    This  freedom,  however,  is 
not  freedom  from  economic  pressure.    It  is  freedom  from  legal  re- 
straint.    Unions   are  lawful  organizations,  like  churches,  political 
parties,  and  the  National  Guard.    But  they  are  not  entitled  to  the 
aid  of  the  law  in  their  efforts  to  increase  their  numbers.    They  must 
make  their  own  way.    But  this  they  must  be  free  to  do,  so  far  as 
the  law  is  concerned,  unless  they  adopt  obnoxious  methods.    Leaving 
aside  the  question  of  methods,  equality  of  legal  right  between  em- 
ployers and  employed  means  the  noninterference  of  the  law  in  their 
struggles  over  collective  bargaining.    And  this  principle  of  equality 
of  noninterference  is  so  sacred  that  legislation  cannot  trespass  upon 
it  without  running  afoul  of  the  restrictions  set  by  due  process. 


652       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

From  these  views  of  policy  which  permeate  the  majority  opinions 
in  the  two  cases  thus  far  considered  we  turn  to  the  case  of  Hitchman 
Coal  and  Coke  Company  v.  Mitchell}  The  complainant  ran  a 
closed  nonunion  mine.  Each  employee  was  engaged  under  circum- 
stances which  the  majority  opinion  states  as  follows : 

Mr.  Pickett,  the  mine  superintendent,  had  charge  of  employing 
the  men,  then  and  afterwards,  and  to  each  one  who  applied  for  em- 
ployment he  explained  the  conditions,  which  were  that  while  the 
company  paid  the  wages  demanded  by  the  union  and  as  much  as 
anybody  else,  the  mine  was  run  nonunion  and  would  continue  so  to 
run ;  that  the  company  would  not  recognize  the  United  IMine 
Workers  of  America ;  that  if  any  man  wanted  to  become  a  member 
of  that  union  he  was  at  liberty  to  do  so ;  but  he  could  not  be  a  mem- 
ber of  it  and  remain  in  the  employ  of  the  Hitchman  Company ;  that 
if  he  worked  for  the  company  he  would  have  to  work  as  a  nonunion 
man.  To  this  each  man  employed  gave  his  assent,  understanding 
that  while  he  worked  for  the  company  he  must  keep  out  of  the  union. 

While  this  arrangement  was  in  force  officers  of  the  U.  M.W.  A. 
visited  the  employees  and  solicited  them  to  agree  to  join  the  union 
and  to  keep  secret  the  fact  of  their  so  agreeing  until  such  time  as 
enough  had  agreed  so  that  the  officers  of  the  union  were  ready  to 
have  the  employer  informed.  Against  these  acts  of  solicitation  an 
injunction  was  granted  by  the  district  court.  After  being  reversed 
by  the  court  of  appeals,  the  decree  of  the  district  court  was  sustained 
by  the  Supreme  Court,-  with  the  exception  of  that  part  which  re- 
strained picketing  and  acts  of  violence.  The  exception  was  due  to 
the  fact  that  neither  of  these  forms  of  interference  had  been 
attempted. 

The  injunction  did  not  specifically  forbid  the  defendants  to  per- 
suade employees  to  promise  to  join  the  union  and  to  keep  the 
promise  a  secret.  One  important  clause  enjoined  the  defendants 
from  attempting  "to  bring  about  the  breaking  by  plaintiff's  em- 
ployees ...  of  their  contracts  of  service,  known  to  the  defendants 

124S  U.S.  232  (1917). 

-The  bill  was  filed  October  24,  1907,  and  a  temporary  injunction  granted. 
This  was  made  final  on  January  18,  IQ13.  The  decree  of  the  district  court 
was  reversed  by  the  circuit  court  of  appeals  on  June  i,  1914.  A  writ  of  cer- 
tiorari was  allowed  by  the  Supreme  Court,  where  the  case  was  argued  in 
March,  1916,  reargued  in  December  of  that  year,  and  decided  a  year  later  on 
December  10,  191 7. 


COLLECTIVE  BARGAINING 


653 


to  exist,  and  especially  from  .  .  .  enticing  such  employees  ...  to 
leave  plaintiff's  service  without  plaintiff's  consent."  This  is  a  strange 
conjunction.  The  employees  could  break  their  contracts  only  by  not 
leaving  plaintiff's  employ  after  affiliating  with  the  union.  If  they 
joined  they  were  to  depart,  not  only  with  plaintiff's  consent  but  by  its 
express  requirement.  They  could  not  both  break  their  contracts 
and  leave  without  the  plaintiff's  consent.^ 

In  so  far  as  the  injunction  relates  to  enticing  employees  to  break 
their  contracts,  it  was  not  justified  by  the  evidence  unless  the  em- 
ployees had  agreed  in  form  or  in  substance  not  to  give  secret 
promises  to  join  the  union.  All  that  they  had  agreed  to  explicitly 
was  to  keep  out  of  the  union  while  they  worked  for  the  Company. 
Mr.  Justice  Brandeis  says  for  the  minority: 

Until  an  employee  actually  joined  the  union  he  was  not,  under 
the  contract,  called  upon  to  leave  plaintiff's  employ.  There  conse- 
quently would  be  no  breach  of  contract  until  the  employee  both 
joined  the  union  and  failed  to  withdraw  from  plaintiff's  employ. 
There  was  no  evidence  that  any  employee  was  persuaded  to  do  that 
or  that  such  a  course  was  contemplated. 

The  majority  do  not  seem  to  question  the  interpretation  put  upon 
the  contract  by  the  minority.  But  they  insist  that  as  thus  inter- 
preted it  had  been  broken  at  defendants'  solicitation.  "In  a  court 
of  equity  ...  to  induce  men  to  agree  to  join  is  but  a  mode  of  in- 
ducing them  to  join."  Those  who  agreed  to  join  ''were  for  all  practi- 
cal purposes,  and  therefore  in  the  sight  of  equity,  already  members 
of  the  union,  and  it  needed  no  formal  ritual  or  taking  of  an  oath 
to  constitute  them  such."  Thus  a  verbal  understanding  between  the 
superintendent  and  each  employee  that  "if  a  man  wanted  to  become 
a  member  of  that  union  he  was  at  liberty  to  do  so,  but  he  could  not 

^This  is  plain  not  only  from  the  evidence  as  to  the  understanding  at  the 
time  of  hiring  but  also  from  what  actually  happened  at  the  Glendale  mine,  a 
concern  owned  by  the  same  stockholders  as  the  Hitchman  and  managed  by 
Pickett,  the  superintendent  also  of  the  Hitchman.  To  quote  from  the  majority 
opinion:  "Pickett,  the  mine  superintendent,  had  learned  of  only  five  men  at  the 
Glendale  who  were  inclined  to  join  Hughes's  movement;  but  when  these  were 
asked  to  remain  outside  of  the  mine  for  a  talk,  fifteen  other  men  waited  with 
them,  and  upon  being  reminded  that  while  the  Company  would  not  try  to 
prevent  them  from  becoming  members  of  the  union,  they  could  not  be  mem- 
bers and  at  the  same  time  work  for  the  Glendale  Company,  they  all  accepted 
this  as  equivalent  to  a  notice  of  discharge." 


'1.- 


m 


^ffii' 


i 


iW     .1 


654       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

be  a  member  of  it  and  remain  in  the  employ  of  the  Hitchman  Com- 
pany" is  broken  when  an  employee  gives  to  a  stranger  a  legally  un- 
enforceable promise  to  join  the  union. 

It  may  be  doubted  whether  any  such  interpretation  would  have 
been  given  to  the  contract  had  the  question  of  its  meaning  arisen 
in  a  dispute  which  involved  only  a  single  employee.  What  the 
plaintiff  desired  was  to  prevent  its  men  from  acting  in  concert.  It 
had  stipulated  against  one  method  of  acting  in  concert,  but  had  failed 
to  cover  all  the  possibilities.  It  is  saved  from  its  oversight  by  the 
decision  of  the  majority  as  to  what  constituted  a  breach  But  the 
decision  on  this  point,  if  unwarranted,  is  material  only  to  the  par- 
ticular litigation.  The  contract  which  the  majority  inferred  for  the 
plaintiff  may  be  expressly  made  by  other  employers.  They  will  then 
be  protected  by  the  Supreme  Court  against  the  kind  of  interference 
with  their  enjoyment  of  those  contracts  which  the  defendants  in  the 
Hitchman  case  ventured  upon.  We  are  more  interested  in  the  rule 
of  law  for  which  the  Hitchman  case  stands  than  in  the  question 
whether  it  was  correctly  applied  to  the  particular  state  of  facts  be- 
fore the  Court. 

In  order  to  know  what  this  rule  of  law  is,  we  must  examine  more 
fully  the  enterprise  of  the  defendants.  They  were  seeking  not  only 
to  get  plaintiff's  employees  to  join  their  union  but  also  to  unionize 
the  plaintiff's  mine.  This  is  not  contested  by  the  minority.  What  is 
meant  by  ''unionizing  the  mine"  is  thus  set  forth  in  the  dissenting 
opinion  of  Mr.  Justice  Brandeis: 

The  operator  by  the  union  agreement  binds  himself:  (i)  to  em- 
ploy only  members  of  the  union ;  ( 2 )  to  negotiate  with  union  officers 
instead  of  employees  individually  the  scale  of  wages  and  the  hours 
of  work;  (3)  to  treat  with  the  duly  constituted  representatives  of 
the  union  to  settle  disputes  concerning  the  discharge  of  men  and 
other  controversies  arising  out  of  the  employment. 

The  demand  for  such  an  agreement  was  to  be  made  as  soon  as 
enough  of  plaintiff's  employees  had  agreed  to  join  the  union  to 
make  it  likely  that  the  demand  would  meet  with  success.  For  such 
success  collective  action  was  important.  To  secure  collective  action 
defendants  sought  to  conceal  from  plaintiff  the  number  and  names 
of  the  employees  who  indicated  a  willingness  to  join  with  them  until 
they  had  won  over  enough  men  to  "crack  off." 


COLLECTIVE  BARGAINING 


655 


This  element  of  secrecy  is  made  so  much  of  in  the  opinion  of  the 
majority  of  the  Court  that  a  lawyerlike  attitude  towards  the  decision 
cannot  regard  it  as  a  precedent  on  any  situation  where  the  element 
of  secrecy  is  lacking.  It  was  the  concealment  of  the  promise  to 
join  the  union  that  made  it  possible  for  the  majority  to  insist  that 
the  defendants  were  inducing  the  employees  to  break  their  contracts 
by  continuing  to  work  after  they  were  really,  though  not  formally, 
members  of  the  union.  And  the  concealment  is  also  regarded  as 
negativing  a  possible  justification  for  the  acts  of  the  defendants. 
Mr.  Justice  Pitney  refers  to  it  as  follows : 

There  is  no  reason  to  doubt  that  it  defendants  had  been  actuated 
by  a  genuine  desire  to  increase  the  membership  of  the  union  without 
unnecessary  injury  to  the  known  rights  of  the  P^^^^/iff,  they  would 
have  permitted  their  proselytes  to  withdraw  from  plaintiff  s  employ 
when  and  as  they  became  affiliated  with  the  union— as  their  contract 
of  employment  required  them  to  do— and  that  in  this  event  plaintiff 
would  have  been  able  to  secure  an  adequate  supply  of  nonunion  men 
to  take  their  places.    It  was  with  knowledge  of  this,  and  because  of 
it   that  defendants,  through  Hughes  as  their  agent,  caused  the  new 
members  to  remain  at  work  in  plaintiff's  mine  until  a  sufficient 
number  of  men  should  be  persuaded  to  join  so  as  to  bring  about  a 
strike  and  render  it  difficult  if  not  practically  impossible  for  plain- 
tiff to  continue  to  exercise  its  undoubted  legal  and  constitutional 
right  to  run  its  mine  "nonunion." 

It  was  one  thing  for  plaintiff  to  find,  from  time  to  time,  compara- 
tivelv  small  numbers  of  men  to  take  vacant  places  m  a  going  mine 
another  and  a  much  more  difficult  thing  to  find  a  complete  gang  of 
new  men  to  start  up  a  mine  shut  down  by  a  strike,  when  there  might 
be  reasonable  apprehension  of  violence  at  the  hands  of  the  strikers 
and  their  sympathizers. 

Mr.  Justice  Pitney  here  gives  countenance  to  the  inference  that  he 
would  have  deemed  it  proper  for  the  defendants  to  ask  plaintiff's 
employees  one  by  one  to  join,  or  to  agree  to  join,  the  umon,  and 
then  immediately  to  notify  plaintiff  and  quit  work,  as  their  con- 
tracts bound  them  to  do.  This  would  not  involve  a  strike,  but  merely 
the  ending  of  the  employment  of  the  men  one  by  one  at  the  com- 
pulsion of  the  employer.  The  issue  of  the  struggle  would  then  depend 
upon  the  rapidity  with  which  individuals  could  be  secured  for  the 
union  and  the  rapidity  with  which  the  employer  could  fill  theu: 
places.    But  the  situation  in  the  case  at  bar  was  different.   There 


IJ 


|-iSJ«« 


656       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

was  an  intention  to  bring  about  a  strike,  so  called,*  even  if  plaintiff 
should  desire  to  retain  the  men  who  joined  the  union.  There  was 
what  the  majority  regarded  as  an  enticement  to  a  breach  of  con- 
tract. It  was  with  such  a  situation  that  the  Court  found  it  had  to 
deal.  To  that  situation  its  opinion  and  its  judgment  should  be  con- 
fined. This  is  not  only  required  by  sound  lawyership  but  is  also 
supported  by  a  paragraph  in  which  Mr.  Justice  Pitney  sums  up 
the  conclusions  reached : 

Upon  all  the  facts,  we  are  constrained  to  hold  that  the  purpose 
entertained  by  the  defendants  to  bring  about  a  strike  at  plaintiff's 
mine  in  order  to  compel  plaintiff,  through  fear  of  financial  loss,  to 
consent  to  the  unionization  of  its  mine  as  the  lesser  evil,  was  an  un- 
lawful purpose,  and  that  the  methods  resorted  to  by  Hughes — the 
inducing  of  employees  to  unite  with  the  union  in  an  effort  to  sub- 
vert the  system  of  employment  at  the  mine  by  concerted  breaches  of 
the  contracts  of  employment  known  to  be  in  force  there,  not  to 
mention  misrepresentation,  deceptive  statements,  and  threats  of 
pecuniary  loss  communicated  by  Hughes  to  the  men — were  unlawful 
and  malicious  methods,  and  not  to  be  justified  as  a  fair  exercise  of 
the  right  to  increase  the  membership  of  the  union. 

The  decision  is  thus  made  dependent  "  upon  all  the  facts,"  includ- 
ing the  threat  of  a  strike  and  the  enticement  to  breaches  of  contract. 
The  majority,  in  the  passage  quoted,  imply  that  other  acts  of  defend- 
ants might  be  "a  fair  exercise  of  the  right  to  increase  the  membership 
of  the  union."    Earlier  in  the  opinion  Mr.  Justice  Pitney  refers  to 

^Mr.  Justice  Brandeis  also  speaks  of  the  intention  to  have  the  men  "join 
the  union  together  and  strike — unless  plaintiff  consented  to  unionize  the  mine." 
But  the  Company,  according  to  its  professions,  was  to  insist  that  the  men  leave 
if  they  joined  the  union.  On  the  case  as  presented  by  the  plaintiff  no  strike 
would  be  necessary,  or  possible.  The  original  employment  at  will  would  be  ended 
by  its  own  terms.  The  status  quo  ante  would  then  be  resumed.  There  would  be 
no  subsisting  contractual  relation  between  the  employer  and  the  members  of 
the  union.  The  issue  would  then  relate  to  what  kind  of  a  new  bargain  would 
evolve  out  of  the  exercise  of  the  respective  liberties  of  employer  and  men. 
There  might  be  a  collective  refusal  on  the  part  of  the  men  to  enter  into  a  new 
agreement  which  did  not  include  unionizing  the  mine.  In  practical  effect  this 
would  not  differ  from  a  collective  abandonment  of  employment  against  the 
wishes  of  the  employer.  But  the  word  "strike"  has  a  false  color  when  used 
in  this  connection.  The  plaintiff  concedes  that  the  men  are  free  to  join  the 
union  at  any  time,  but  insists  that  if  they  do  they  must  quit.  If  after  that 
there  is  a  deadlock,  it  is  quite  as  fair  to  call  the  situation  a  lockout  as  to  call 
it  a  strike.  To  call  it  a  strike  seems  inconsistent  with  plaintiff's  professed 
conception  of  the  arrangement  originally  entered  into. 


COLLECTIVE  BARGAINING 


657 


"  the  right  of  workingmen  to  form  unions,  and  to  enlarge  their  mem- 
bership by  inviting  other  workingmen  to  join  them"  and  says: 
"This  right  is  freely  conceded,  provided  the  objects  of  the  union 
be  proper  and  legitimate,  which  we  assume  to  be  true,  in  a  general 
sense,  with  respect  to  the  union  here  in  question."    But  then  he  adds : 

The  cardinal  error  of  defendants'  position  lies  in  the  assumption 
that  the  right  is  so  absolute  that  it  may  be  exercised  under  any 
circumstances  and  without  any  qualification ;  whereas  in  truth,  like 
other  rights  that  exist  in  civilized  society,  it  must  always  be  exercised 
with  reasonable  regard  for  the  conflicting  rights  of  others. 

Here  we  have  a  recognition  that  the  "rights"  of  employers  and 
the  "rights"  of  laborers  conflict.    The  successful  exercise  of  the 
"  right "  of  members  of  the  union  to  increase  their  numbers  will  inter- 
fere pro  tanto  with  the  successful  exercise  of  the  "right"  of  em- 
ployers to  run  their  mines  nonunion.    Yet  both  rights  exist  and  are 
declared  to  be  entitled  to  an  equality  of  legal  protection.    Plainly, 
therefore,  the  majority  give  no  satisfactory  reason  for  their  inter- 
ference with  the  "right"  of  the  defendants  by  declaring  that  the 
defendants  were  interfering  with  the  "right"  of  the  plaintiff.    The 
defendants  could  exercise  their  right  with  respect  to  plaintiff's  em- 
ployees only  by  interfering  with  the  conflicting  right  of  the  plaintiff. 
We  may  then  dismiss  as  merely  prefatory  the  numerous  statements 
of  Mr.  Justice  Pitney  with  respect  to  the  right  of  the  plaintiff  to 
exclude  union  men  from  its  employ,  and  to  the  interference  with 
that  right  by  the  defendants.    These  statements  have  been  subjected 
to  a  searching  and  illuminating  analysis  by  Professor  Walter  W. 
Cook.^    By  the  use  of  a  somewhat  elaborate  verbal  technic,  which 
gives    different    terms    to    the    different   varieties    of    legal    rights, 
Mr.  Cook  shows  how  Mr.  Justice  Pitney  uses  "right"  now  in  one 
sense  and  now  in  another,  thus  unconsciously  asserting  a  new  propo- 
sition, and  one  as  yet  unproved,  under  the  form  of  merely  reiterating 
something  firmly  established.    But  in  spite  of  these  lapses  in  the 
argumentation  the  majority  opinion,  by  entering  upon  the  question 
whether  defendants'  interference  with  plaintiff's  interests  was  justi- 
fied, reaches  the  nub  of  the  controversy. 

1"  Privileges  of  Labor  Unions  in  the  Struggle  for  Life,"   Yale  Law  Journal, 
Vol.  XXVII  (April,  1918),  p.  779- 


illt^t^ 


1 


658       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  minority  concede  that  the  defendant  must  show  justification. 
They  "were  within  their  rights,"  says  Mr.  Justice  Brandeis,  "if,  and 
only  if,  their  interference  with  the  relation  of  plaintiff  to  its  em- 
ployees was  for  justifiable  cause."  And  the  justification  is  then 
stated  as  follows: 

The  purpose  of  interfering  was  confessedly  in  order  to  strengthen 
the  union,  in  the  belief  that  thereby  the  condition  of  workmen  engaged 
in  mining  would  be  improved ;  the  bargaining  power  of  the  indi- 
vidual workingman  was  to  be  strengthened  by  collective  bargaining ; 
and  collective  bargaining  was  to  be  insured  by  obtaining  the  union 
agreement.  It  should  not,  at  this  day,  be  doubted  that  to  induce 
workingmen  to  leave  or  not  to  enter  an  employment,  in  order  to 
advance  such  a  purpose,  is  justifiable  when  the  workmen  are  not 
bound  by  contract  to  remain  in  such  employment. 

But  the  majority  insist  that  the  end  aimed  at  was  not  a  justifica- 
tion for  the  interference.  The  defendants'  activities,  says  Mr.  Jus- 
tice Pitney,  "cannot  be  treated  as  a  bona  fide  effort  to  enlarge  the 
membership  of  the  union."  The  reason  given  is  in  substance  that 
it  was  an  effort  to  do  something  more  than  to  enlarge  the  union.  It 
was  an  attempt  to  unionize  the  mine  after  the  union  was  enlarged. 
But  Mr.  Justice  Pitney  says  that  "there  is  no  evidence  to  show, 
nor  can  it  be  inferred,  that  defendants  intended  or  desired  to  have 
the  men  at  the  mines  join  the  union,  unless  they  could  organize  the 
mines."  Of  course  if  they  gained  this  end  they  would  enlarge  the 
union.  And  the  enlargement  of  the  union  is  always  sought  for  some 
more  concrete  advantage  than  mere  growth  in  numbers.  The  reason 
why  there  is  any  truth  to  the  statement  that  the  defendants  did  not 
wish  plaintiff's  employees  to  join  the  union  unless  the  mine  could  be 
thereby  unionized  is  that  such  unionization  was  deemed  necessary  in 
order  to  safeguard  the  interests  of  the  men  after  they  were  in  the 
union  and  to  make  it  possible  for  them  to  remain  in  the  union. 

But  Mr.  Justice  Pitney's  analysis  of  the  defendants'  purposes,  how- 
ever faulty,  indicates  where  he  draws  the  line  as  to  what  constitutes 
an  adequate  justification.  Union  organizers  can  get  men  to  join  the 
union  if  they  do  not  thereby  interfere  with  the  employer's  "un- 
doubted legal  and  constitutional  right  to  run  its  mine  'nonunion.'" 
They  may  increase  the  union  if  they  do  it  in  such  a  way  that  an 
employer  can  readily  continue  to  get  nonunion  laborers.    But  they 


COLLECTIVE  BARGAINING 


659 


must  not  attempt  to  "alienate  a  sufficient  number  of  the  men  to 
shut  down  the  mine,  to  the  end  that  the  fear  of  losses  through  stop- 
page of  operations  might  coerce  plaintiff  into  'recognizing  the 
union'  at  the  cost  of  its  own  independence."  The  purpose  of  organ- 
izing the  mine  is  no  justification.  Where  "unionizing  the  miners  is 
but  a  step  in  the  process  of  unionizing  the  mine"  the  plaintiff  "is 
as  much  entitled  to  prevent  the  first  step  as  the  second,  so  far  as  its 
own  employees  are  concerned,  and  to  be  protected  against  irrepara- 
ble injury  resulting  from  either."  And  the  purpose  of  securing  col- 
lective bargaining  is  not  a  justification  for  disturbing  an  employer 
unless  the  employer  is  willing  to  bargain  that  way.  "Whatever 
may  be  the  advantages  of  'collective  bargaining,'  it  is  not  bargaining 
at  all,  in  any  just  sense,  unless  it  is  voluntary  on  both  sides." 

This  irenic  conception  of  the  way  buyers  and  sellers  should  bar- 
gain bespeaks  a  noble  ideal,  but  one  not  yet  fully  realized  in  the 
coal  regions.  Collective  bargaining  is  seldom,  if  ever,  brought  about 
because  employers  desire  it  above  all  other  forms.  It  is  brought 
about  because  employers  prefer  it  to  making  no  bargains  at  all.  It  is 
interesting  that  it  is  Mr.  Justice  Pitney  who  refers  to  the  acts  of  the 
defendants  as  the  "employment  of  coercive  measures  to  secure  a 
closed  union  shop  through  a  collective  agreement  with  the  union." 
For  it  was  Mr.  Justice  Pitney  who  reminded  us  in  the  Coppage  case 
that  it  was  not  "coercion"  to  propose  certain  terms  of  employment 
which  one  has  the  right  to  propose.  Now  it  is  the  minority  who  have 
to  tell  us  that  economic  pressure  is  not  coercion  in  a  legal  sense.  As 
Mr.  Justice  Brandeis  puts  it : 

The  employer  is  free  either  to  accept  the  agreement  or  the  disad- 
vantage. Indeed,  the  plaintiff's  whole  case  is  rested  upon  agree- 
ments secured  under  similar  pressure  of  economic  necessity  or 
disadvantage.  If  it  is  coercion  to  threaten  to  strike  unless  plaintiff 
consents  to  a  closed  union  shop,  it  is  coercion  also  to  threaten  not 
to  give  one  employment  unless  the  applicant  will  consent  to  a  closed 
nonunion  shop.  The  employer  may  sign  the  union  agreement  for 
fear  that  labor  may  not  be  otherwise  obtainable ;  the  workman  may 
sign  the  individual  agreement,  for  fear  that  employment  may  not  be 
otherwise  obtainable.  But  such  fear  does  not  imply  coercion  in  a 
legal  sense. 

But  Mr.  Justice  Pitney  takes  a  more  idyllic  view  of  the  original 
nonunion  agreement  at  the  Hitchman.   He  speaks  of  the  fact  that 


66o       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  defendants  had  plain  notice  "that  the  observance  of  this  agree- 
ment was  of  great  importance  and  value  both  to  the  plaintiff  and  to 
its  men  who  had  voluntarily  made  the  agreement  and  desired  to 
continue  working  under  it."  And  again  he  says  that  the  plaintiff 
"established  the  mine  on  a  nonunion  basis,  with  the  unanimous  ap- 
proval of  its  employees— in  fact  upon  their  suggestion— and  under 
a  mutual  agreement  assented  to  by  every  employee,  that  plaintiff 
would  continue  to  run  its  mine  nonunion.  .  .  ."  This  "suggestion" 
of  the  employees  is  earlier  detailed  by  Mr.  Justice  Pitney  as  follows : 

About  the  first  of  June  a  self-appointed  committee  of  employees 
called  upon  plaintiff's  president,  stated  in  substance  that  they  could 
not  remain  longer  on  strike  because  they  were  not  receiving  benefits 
from  the  union,  and  asked  upon  what  terms  they  could  return  to 
work.  Thev  were  told  that  they  could  come  back,  but  not  as  mem- 
bers of  the'  United  Mine  Workers  of  America ;  that  thenceforward 
the  mine  would  be  run  on  a  nonunion  basis,  and  the  company  would 
deal  with  each  man  individually.  They  assented  to  this  and  returned 
to  work  on  a  nonunion  basis. 

A  further  side  light  is  thrown  on  the  situation  by  the  account  in 
the  majority  opinion  of  the  activities  of  the  union  organizer:  "He 
prophesied,  in  such  a  way  that  ignorant,  foreign-born  miners,  such  as 
he  was  addressing,  naturally  might  believe  that  he  was  speaking  with 
knowledge.  .  .  ."  Ignorant  and  gullible  were  the  men  who  volun- 
tarily made  the  nonunion  agreement  with  their  employer  and  desired 
to  continue  working  under  it. 

Closely  connected  with  Mr.  Justice  Pitney's  change  of  view  as  to 
what  constitutes  "coercion"  is  his  shift  with  respect  to  "independ- 
ence." In  the  Hitchman  case  he  speaks  of  the  defendants'  action  as 
being  directed  "to  the  end  that  the  fear  of  losses  through  stoppage 
of  operations  might  coerce  plaintiff  into  'recognizing  the  union'  at 
the  cost  of  its  own  independence.'*  But  in  the  Coppage  case  he  did 
not  recognize  any  loss  of  independence  by  the  laborers  who  had  to 
agree  to  refrain  from  union  affiliations  in  order  to  get  work.  The 
employee  was  said  to  be  "  free  to  decline  employment  on  those  terms, 
just  as  the  employer  may  decline  to  offer  employment  on  any  other ; 
for  'it  takes  two  to  make  a  bargain.'"  As  to  loss  of  independence 
after  making  the  bargain,  he  said :  "  Freedom  of  contract,  from  the 
very  nature  of  the  thing,  can  be  enjoyed  only  by  being  exercised ; 


COLLECTIVE  BARGAINING 


66i 


and  each  particular  exercise  of  it  involves  making  an  engagement 
which,  if  fulfilled,  prevents  for  the  time  any  inconsistent  course  of 
conduct."  In  the  Hitchman  case  it  is  not  to  Mr.  Justice  Pitney  but 
to  Mr.  Justice  Brandeis  that  we  must  look  for  this  point  of  view. 
In  the  dissenting  opinion  we  find  the  following : 

It  is  urged  that  a  union  agreement  curtails  the  liberty  of  the  oper- 
ator. Every  agreement  curtails  the  liberty  of  those  who  enter  into  it. 
The  test  of  legality  is  not  whether  an  agreement  curtails  liberty,  but 
whether  the  parties  have  agreed  upon  something  which  the  law  pro- 
hibits or  declares  otherwise  to  be  inconsistent  with  the  public  welfare. 

Then  follows  the  enumeration  of  the  details  of  the  union  agreement 
quoted  on  page  654  supra,  and  the  comment : 

These  are  the  chief  features  of  a  ''unionizing"  by  which  the  em- 
ployer's liberty  is  curtailed.  Each  of  them  is  legal.  To  obtain  any 
of  them  or  all  of  them  men  may  lawfully  strive  and  even  strike. 
And  if  the  union  may  legally  strike  to  obtain  each  of  the  things  for 
which  the  agreement  provides,  why  may  it  not  strike  or  use  equiva- 
lent economic  pressure  to  secure  an  agreement  to  provide  them? 

To  this  Mr.  Justice  Pitney  gives  no  answer  except  to  reiterate 
the  "legal  right"  of  the  plaintiff  to  run  its  mine  nonunion,  to  make 
agreements  to  that  end  with  its  employees,  and  "to  be  protected 
in  the  enjoyment  of  the  resulting  status,  as  in  any  other  legal  right." 
This  status  is  deemed  so  sacred  that  the  purpose  of  the  union  leaders 
to  interfere  with  it  is  in  itself  unlawful.  Unions  may  strive  to 
increase  their  numbers,  but  they  must  not  in  so  doing  strive  to  union- 
ize any  mine  in  which  employees  have  ageed  to  quit  if  they  join  the 
union.  After  quoting  a  familiar  statement  from  the  Mogul  Steamship 
Case^  as  to  the  unlawfulness  of  inflicting  intentional  damage  without 
just  cause  or  excuse,  ]Mr.  Justice  Pitney  adds : 

And  the  intentional  infliction  of  such  damage  upon  another,  with- 
out justification  or  excuse,  is  malicious  in  law.  .  .  .  And  we  cannot 
deem  the  proffered  excuse  to  be  a  "just  cause  or  excuse"  where  it  is 
based,  as  in  this  case,  upon  an  assertion  of  conflicting  rights  that  are 
sought  to  be  attained  by  unfair  methods,  and  for  the  very  purpose 
of  interfering  with  plaintiff's  rights,  of  which  defendants  have  full 
notice. 

123  Q.  B.  Div.  613. 


662        TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Leaving  aside  the  question  of  methods/  this  is  to  say  that  plain- 
tiff's purpose  is  its  right,  and  therefore  defendants'  contrary  purpose 
cannot  be  their  right. 

Defendants'  purpose  seems  to  be  regarded  as  illegal,  no  matter 
by   what   methods   it   is   pursued.    Much   of   the   assertion   in   the 
majority  opinion  leads  to  this  inference,  and  the  inference  is  reen- 
forced  by  one  of  the  clauses  of  the  injunction.    As  paraphrased  by 
Mr.  Justice  Pitney,  it  restrained  defendants  from  "knowingly  and 
willfully  enticing  plaintiff's  employees,  present  or  future,  to  leave 
plaintiff's  service  on  the  ground  that  plaintiff  does  not  recognize  the 
United  Mine  Workers  of  America  or  runs  a  nonunion  mine,  etc." 
In  this  clause  there  is  no  reference  to  enticing  breaches  of  contract. 
So  far  as  the  terms  above  quoted  disclose,  defendants  would  be  sent 
to  jail  if  they  persuaded  any  of  plaintiff's  employees  to  join  the  union. 
For  anyone  who  joined  had  to  leave  plaintiff's  service  because  plain- 
tiff ran  a  nonunion  mine.    Enticing  him  to  join  the  union  is  enticing 
him  to  leave  because  plaintiff  runs  a  nonunion  mine.    Such  leaving 
would,  it  is  true,  be  by  the  consent  and  the  compulsion  of  the  plain- 
tiff, but  the  clause  now  under  consideration  is  not  qualified  by  the 
words  "without  plaintiff's  consent." 

iThe  minority  insist  that  the  methods  of  defendants  were  entirely  fair.  The 
organizer  had  informal  talks  and  some  quietly  conducted  public  meetings  in  which 
he  pointed  out  that  though  "  the  Company  was  then  paying  them  according  to 
the  union  scale,  there  would  be  nothing  to  prevent  a  later  reduction  of  wages 
unless  the  men  united."  He  also  pointed  out  that  if  the  men  lost  their  present 
jobs,  "membership  in  the  union  was  requisite  to  obtaining  employment  in  the 
union  mines  of  the  neighboring  states."  The  majority,  however,  insist  that  he 
used  "abusive  language''  respecting  the  superintendent  and  two  of  the  miners 
who  evidently  were  opposed  to  the  union,  and  that  he  represented  the  possible 
reduction  of  wages  so  that  the  ignorant  miners  might  naturally  believe  he  was 
speaking  with  knowledge.  They  also  refer  to  a  conversation  in  which  he 
represented  that  Koch,  the  general  manager,  "had  nothing  against  having  the 
place  organized  again." 

The  really  important  dispute  as  to  methods  is  whether  they  Involved  breach 
of  contract.  The  minority  do  not  make  clear  whether,  if  they  agreed  with  the 
view  that  continuing  work  after  the  secret  agreement  constituted  a  breach  of 
contract,  they  would  sanction  the  injunction  on  that  point.  They  concede  that 
mere  persuasion  to  leave  the  employment  requires  justification,  and  declare  that 
plaintiff's  individual  contracts  add  nothing  to  its  rights  so  long  as  the  employ- 
ment is  terminable  at  will.  They  hold,  however,  that  the  object  of  strengthen- 
ing the  union  justified  the  persuasion.  They  imply  that  it  would  not  justify 
inducing  breach  of  a  contract  to  serve  for  a  definite  term.  But  as  to  other 
possible  contracts  they  are  silent. 


COLLECTIVE  BARGAINING 


663 


It  is  probable,  however,  that  Mr.  Justice  Pitney's  paraphrase  of 
this  clause  of  the  injunction  is  incomplete.    The  reference  to  it  in 
the  minority  opinion  contains  the  qualification:  "for  the  purpose  of 
unionizing  plaintiff's  mine  without  plaintiff's   consent."    But  even 
this  qualification  would  not  make  licit  an  "enticement"  to  join  the 
union  which  was  part  of  a  plan  to  unionize  the  mine.    If  defendants 
had  such  a  plan,  they  would  be  restrained  from  asking  plaintiff's 
employees  one  by  one  to  join  the  union,  even  though  they  joined 
openly  and  withdrew  from  work  at  once  as  the  employer  desired. 
If  union  officials  wish  to  start  a  membership  campaign  among  miners 
working  under  a  nonunion  agreement,  they  must  be  without  any 
thought  of  later  unionizing  the  mine.    For  to  seek  to  unionize  a  mine 
run  under  a  nonunion  agreement  is  to  seek  to  make  it  impossible  for 
the  mine  owner  "  to  exercise  his  undoubted  legal  and  constitutional 
right,"  and  for  the  very  purpose  of  making  it  impossible,  and  there- 
fore without  just  cause  or  excuse.    For  it  is  no  justification  that  the 
defendants  are  seeking  to  strengthen  the  union  and  to  secure  collec- 
tive bargaining,  since  collective  bargaining  interferes  with  the  em- 
ployer's right  to  make  individual  bargains  and  "is  not  bargaining 
at  all  in  any  just  sense  unless  it  is  voluntary  on  both  sides."    It  is 
"coercion"  and  an  interference  with  the  "independence"   of   the 

employer. 

Recognized  canons  of  judicial  action  require  us  to  limit  the  author- 
ity of  the  actual  decision  of  the  Hitchman  case  to  situations  where 
there  is  some  element  of  breach  of  contract  and  a  threatened  strike. 
Parts  of  the  majority  opinion  so  limit  the  decision.  But  other  parts 
and  some  of  the  terms  of  the  injunction  go  further.  Two  inconsistent 
threads  of  thought  run  through  the  majority  opinion.  One  would 
permit  union  officials  to  secure  members  from  men  working  under  a 
nonunion  agreement  if  each  man  announces  his  new  affiliation  as 
soon  as  it  occurs  and  leaves  the  employment  as  the  contract  under 
which  he  is  working  permits  and  requires.  The  other  would  forbid 
it  if  there  was  evidence  of  a  plan  to  unionize  the  mine. 

If  law,  as  Mr.  Justice  Holmes  says,  is  a  prophecy  of  what  courts 
will  do  in  fact,  it  is  more  important  to  know  what  a  majority  of  the 
Supreme  Court  think  than  what  they  have  technically  decided.  And 
it  seems  pretty  clear  that  at  present  a  majority  of  the  Supreme  Court 
think  that  labor  unions  must  take  no  steps  whatever  to  unionize 


.J 


■■; 


664       TRADE  UN10NIS]\I  AND  LABOR  PROBLEMS 

a  nonunion  mine,  at  least  where  its  nonunion  character  has  been  pro- 
tected by  contracts  with  the  employees.  In  the  absence  of  such  an 
object  they  may  take  steps  to  get  union  members  from  a  nonunion 
mine  provided  the  employer  is  apprised  of  each  inch  of  their  prog- 
ress. If  their  success  is  sufficiently  rapid,  the  employer  may  find 
himself  in  a  position  where  he  prefers  to  ask  the  men  to  come 
back  even  though  they  remain  in  the  union.  Then  arises  a  new 
situation  which  the  Hitchman  case  does  not  cover.  For  it  is  ex- 
plicitly stated  in  the  majority  opinion  that  "the  case  involves  no 
question  of  the  rights  of  employees,"  and  further  that  the  "defen- 
dants could  not,  without  agency,  set  up  any  rights  that  employees 

might  have." 

If,  therefore,  union  officials  form  their  plan  to  unionize  a  mine 
only  after  it  has  ceased  to  be  a  closed  nonunion  mine  and  has  be- 
come an  open  one,  it  would  seem  that  they  may  carry  out  their 
plan  as  agents  of  the  union  members  among  the  employees.    But 
the  present  majority  of  the  Supreme  Court  is  not  likely  to  find  such 
a  situation,  occurring  in  the  affairs  of  the  United  Mine  Workers  of 
America.    For  they  will  always  have  the  evidence  relied  on  in  the 
Hitchman  case,  which  establishes  from  the  proceedings  of  their  an- 
nual convention  that  the  U.  M.W.A.  mean  to  unionize  every  mine 
they  can.    Ever>'  step  to  secure  members  from  nonunion  mines  must 
therefore  be  part  of  a  plan  to  unionize  the  mine.  Employees  who  wish 
to  affiliate  with  the  U.  M.W.A.  must  do  so  entirely  of  their  own 
initiative.    But  even  this  initiative  will  probably  be  checked  by  the 
type  of  nonunion  agreement  which  appears  in  Eagle  Glass  and  Manu- 
facturing Company  v.  Roive,'-  decided  the  same  day  as  the  Hitch- 
man case.    This  required  each  employee  to  promise  "that  if  at  any 
time  while  so  employed  he  desired  to  become  connected  with  the 
union  he  would  withdraw  from  the  employ  of  the  Company,  and  that 
while  in  its  employ  he  would  not  make  any  effort  amongst  its  em- 
ployees to  bring  about  the  unionizing  of  the  plant  against  the  Com- 
pany's wish."   With  such  an  agreement  the  employees  themselves 
would  be  restrained  from  casting  glances  at  the  union  in  the  desire 
to  get  the  mine  unionized. 

Thus  it  appears  that  the  equal  liberty  of  employer  and  employed 
which  is  the  boast  of  the  law  is  a  personal  and  individual  matter. 

1245  U.S.  276  (1917). 


COLLECTIVE  BARGAINING 


665 


Each  laborer  when  unemployed  is  as  free  from  legal  restraint  as  to 
what  bargain  he  shall  make  as  is  each  employer.   After  his  bargain 
the  extent  of  his  freedom  depends  upon  the  terms  of  the  bargain. 
Though  limited,  it  is  self-limited.    Freedom  has  curtailed  freedom. 
But  the  freedom  curtailed  is  not  that  of  the  individual  contractor 
alone.    By  a  bargain  which  leaves  himself  free  to  leave  the  em- 
ployment at  any  time  he  binds  others  not  to  persuade  him  to  leave. 
For  he  has  helped  to  create  a  status— the  status  of  the  closed  non- 
union shop.   He  may  dissolve  the  status  so  far  as  it  concerns  him. 
But  others  may  not  seek  to  dissolve  the  status  through  him.   Thus 
each  laborer  holds  in  his  own  hands  the  liberty  of  other  laborers, 
which  he  may  bargain  away.   Much  as  they  may  desire  to  improve 
their  position  by  prevailing  upon  all  laborers  to  act  collectively,  they 
may  not  approach  one  who  has  agreed  to  leave  his  employment  if  he 
desires  to  unite  with  them.   "The  right  of  workingmen  to  form 
unions,  and  to  enlarge  their  membership  by  inviting  other  working- 
men  to  join  them"  is  "freely  conceded."    But  the  judges  who  con- 
cede it  hold  that  it  cannot  be  exercised  for  the  purpose  of  changing  a 
closed  nonunion  mine  into  a  closed  union  mine.    To  the  contention 
to  the  contrar\^  "it  is  a  sufficient  answer,  in  law,  to  repeat  that 
plaintiff  had  a  legal  and  constitutional  right  to  exclude  union  men 

from  its  employ." 

This  is  the  law  of  West  Virginia,  as  declared  by  the  Supreme  Court 
of  the  United  States  in  a  case  where  federal  jurisdiction  obtained  by 
reason  of  diversity  of  citizenship.    Mr.  Cook,  in  the  article  previously 
referred  to,  says  that  the  cases  cited  by  the  Supreme  Court  from 
West  Virginia  and  other  jurisdictions  in  support  of  the  inadequacy 
of  defendants'  justification  do  not  establish  it.    They  support  the 
principle  that  justification  is  necessary  to  excuse  one  who  persuades 
employees  to  leave  their  employer,  but  they  do  not  negative  the  law- 
fulness of  the  excuse  offered  by  the  defendants  in  the  case  at  bar. 
Mr.  Justice  Pitney  negatives  it  only  by  asserting  that  defendants' 
purpose   and   alleged   justification   interfere   with   plamtiff's    right. 
This  is  conceded  if  the  term  "right"  is  properly  understood.    But 
in  the  same  sense  of  the  term  the  interference  was  in  the  exercise  of 
a  conflicting  right  of  the  defendants.   The  mere  statement  of  the  con- 
flict throws  no  light  on  which  should  prevail,  or  what  adjustment 
should  be  made.   That  question  is  plainly  one  of  policy.    Congress 


il: 


666       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


and  the  legislatures  of  at  least  fourteen  states^  have  indicated  their 
views  of  policy  by  prohibiting  the  type  of  agreement  which  was  the 
foundation  of  the  plaintiff's  action  in  the  Hitchman  case.  This  policy 
the  Supreme  Court  reverses,  not  only  by  insisting  that  the  making 
of  such  agreements  cannot  be  inhibited  but  by  declaring  that  when 
made  for  any  mine  or  mill  they  end  the  liberty  of  organized  labor 
to  seek  to  organize  that  establishment. 

These  competing  policies  are  undoubtedly  debatable.  It  is  much 
less  clear  that  the  judges  have  satisfactorily  debated  them.  Much, 
if  not  most,  of  the  reasoning  given  in  support  of  the  decisions  is 
abstract  and  artificial.  "Liberty"  and  "equality"  and  "right"  seem 
often  to  be  terms  to  conjure  with  rather  than  to  enlighten.  We  are 
not  likely  to  get  a  satisfactory  solution  of  the  problem  of  collective 
bargaining  through  the  jurisprudence  of  abstract  conceptions.  In- 
deed, jurisprudence  of  any  kind  may  play  but  a  pigmy  part  in  the 
solution,  which  seems  to  be  conditioned  less  on  the  conclusions  of 
judicial  reasoning  than  on  what  a  despised  and  revered  writer  has 
called  "that  simpler  line  of  expedients  which  the  drift  of  circum- 
stance, being  not  possessed  of  a  legal  mind,  has  employed  in  the 
sequence  of  institutional  change  hitherto."  The  three  decisions  under 
review  do  not  seem  greatly  to  have  delayed  the  progress  of  collec- 
tive bargaining.  They  may  soon  be  mainly  of  philosophical  and 
antiquarian  interest. 

Thomas  Reed  Powell 

Columbia  Universtty 


if  j-^ 


^A  list  is  given  in  the  margin  of  Mr.  Justice  Day's  dissenting  opinion  in  the 
Coppage  case,  at  page  29. 


m 


U 


XL 
A  NEW  PROVINCE  FOR  LAW  AND  ORDERS 

THE  new  province  is  that  of  the  relations  between  employers 
and  employees.  Is  it  possible  for  a  civilized  community  so 
to  regulate  these  relations  as  to  make  the  bounds  of  the  industrial 
chaos  narrower,  to  add  new  territory  to  the  domain  of  order  and 
law?  The  war  between  the  profit-maker  and  the  wage-earner  is 
always  with  us ;  and,  although  not  so  dramatic  or  catastrophic  as 
the  present  war  in  Europe,  it  probably  produces  in  the  long  run 
as  much  loss  and  suffering,  not  only  to  the  actual  combatants  but 
also  to  the  public.   Is  there  no  remedy? 

During  a  brief  sojourn  in  the  United  States  in  the  summer  of 
19 14  I  had  the  good  fortune  to  meet  many  men  and  women  of 
broad  and  generous  outlook  and  of  admirable  public  spirit.  They 
were  anxious  to  learn  what  I,  as  president  of  the  Australian  Court 
of  Conciliation  and  Arbitration,  could  tell  them  of  Australian 
methods  of  dealing  with  labor  questions.  I  propose  now,  on  the 
invitation  of  the  editor  of  this  Review,  to  state  briefly  the  present 
position,  confining  my  survey  to  my  own  personal  experience. 

The  Australian  Federal  Constitution  of  1900  gave  to  the  Federal 
Parliament  power  to  make  laws  with  respect  to  "conciliation  and 
arbitration  for  the  prevention  and  settlement  of  industrial  disputes 
extending  beyond  the  limits  of  any  one  state."  ^  Following  the 
example  of  the  United  States  Constitution,  the  Constitution  left 
all  residuary  powers  of  legislation  to  the  states;  and  the  theory 
generally  held  at  the  time  of  our  constitutional  convention  was 
that  each  state  should  be  left  to  deal  with  its  own  labor  conditions 
as  it  thought  best.  But  an  exception  was  made,  after  several 
discussions,  in  favor  of  labor  disputes  which  pass  beyond  state 
boundaries  and  cannot  be  effectually  dealt  with  by  the  laws  of  any 
one  or  more  states.    Just  as  bush  fires  run  through  the  artificial 

iFrom  Harvard  Law  Review,  Vol.  XXIX  (1915),  PP-  ^-39- 
2  Article  XXXV,  Section  51. 

667 


\ 


668       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

state  lines,  just  as  the  rabbits  ignore  them  in  pursuit  of  food,  so  do, 
frequently,  industrial  disputes. 

In  pursuance  of  this  power  an  act  was  passed  December  15,  1904, 
constituting  a  Court  for  Conciliation,  and  where  conciliation  is  found 
impracticable,  arbitration.  The  arbitration  is  compulsory  in  the  sense 
that  an  award,  if  made,  binds  the  parties.  The  act  makes  a  strike  or  a 
lockout  an  offense  if  the  dispute  is  within  the  ambit  of  the  act — if  the 
dispute  is  one  that  extends  beyond  the  limits  of  one  state.  In  other 
words,  the  process  of  conciliation,  with  arbitration  in  the  background, 
is  substituted  for  the  rude  and  barbarous  processes  of  strike  and 
lockout.  gpn,f^r>n  ^^  ^n  Hkpjp^r^  ff^^T^ ;  the  might  of  the  State  is  to 
enforce  peace  betweenmHustrial  combatants  as  well  as  between  other 
combatants ;  and  all  in  the  interest  of  the  public. 

Under  the  act  the  Court  consists  of  a  president,  who  must  be  one 
of  the  justices  of  the  High  Court  of  Australia.  The  High  Court  is 
modeled  on  the  Supreme  Court  of  the  United  States,  having  often  to 
decide  whether  acts  are  constitutional,  but  it  is  also  a  Court  of 
Appeal  from  the  supreme  courts  of  the  states.  The  first  president 
of  the  Court  of  Conciliation  was  appointed  February  10,  1905, 
and  on  his  resignation  in  September,  1907,  I  was  appointed  as  his 
successor. 

The  first  task  that  I  had  to  face  was  not,  strictly  speaking,  con- 
ciliation or  arbitration.  The  Federal  Parliament  imposed  certain 
excise  duties  on  agricultural  implements  manufactured,  but  it  pro- 
vided for  the  remission  of  the  duties  in  the  case  of  goods  manu- 
factured under  conditions,  as  to  the  remuneration  of  labor,  which 
the  president  of  the  Court  should  certify  to  be  "  fair  and  reasonable."^ 
The  act  gave  no  guidance  as  to  the  model  or  criterion  by  which 
fairness  and  reasonableness  were  to  be  determined.  In  dealing 
with  the  first  employer  who  applied  to  me  for  a  certificate  I  came  to 
the  conclusion  that  the  act  was  designed  for  the  benefit  of  employees 
and  that  it  was  meant  to  secure  for  them  something  which  they  could 
not  get  by  individual  bargaining  with  their  employers.  If  A  let  B 
have  the  use  of  his  horse  on  the  terms  that  B  give  the  horse  fair  and 
reasonable  treatment,  B  would  have  to  give  the  horse  proper  food 
and  water,  shelter,  and  rest.  I  decided,  therefore,  to  adopt  a  standard 
based  on  "the  normal  needs  of  the  average  employee,  regarded  as 

1  Excise  Tariff  1906. 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER         669 

a  human  being  living  in  a  civilized  community."    This  was  to  be 
the  primary  test  in  ascertaining  the  minimum  wage  that  would  be 
treated  as  "fair  and  reasonable"  in  the  case  of  unskilled  laborers. 
At  my  suggestion  many  household  budgets  were  stated  in  evidence, 
principally  by  housekeeping  women  of  the  laboring  class ;  and,  after 
selecting  such  of  the  budgets  as  were  suitable  for  working  out  an 
average,  I  found  that  in  Melbourne,  the  city  concerned,  the  aver- 
age necessary  expenditure  in  1907   on  rent,   food,  and  fuel  in  a 
laborer's  household  of  about  five  persons  was  £1   12  s.  5^.   (about 
$7.80,  taking  a  dollar  as  equivalent  to  45.  2d.);  but  that,  as  these 
figures  did  not  cover  light,  clothes,  boots,  furniture,  utensils,  rates,  life 
insurance,  savings,  accident  or  benefit  societies,  loss  of  employment, 
union  pay,  books  and  newspapers,  tram  or  train  fares,  sewing  ma- 
chine, mangle,  school  requisites,  amusements  and  holidays,  liquors, 
tobacco,  sickness  or  death,  religion  or  charity,  I  could  not  certify 
that  any  wages  less  than  42  s.  per  week  for  an  unskilled  laborer  would 
be  fair  and  reasonable.    Then,  in  finding  the  wages  which  should  be 
treated  as  fair  and  reasonable  in  the  cases  of  the  skilled  employees,  I 
relied  mainly  on  the  existing  ratios  found  in  the  practice  of  employers. 
If,  for  instance,  the  sheet-iron  worker  got  Ss.  per  day  when  the 
laborer  got  6  s.,  the  sheet-iron  worker  should  get,  at  the  least,  9  s. 
when  the  laborer's  minimum  was  raised  to  7  5. 

In  the  case  referred  to,  the  employer  did  not  raise  before  me  the 
point  that  the  act  was  invalid ;  but,  having  failed  in  his  application 
for  a  certificate,  he  refused  to  pay  the  excise  duty,  and  defended 
an  action  to  recover  the  duty  before  the  High  Court  on  the  ground 
that  the  act  was  invalid ;  and  he  succeeded,  by  a  majority  of  three 
justices  to  two,  on  the  ground  that  the  act  was  not  really  a  tax- 
ation act  at  all,  but  an  act  to  regulate  labor  conditions,  and  as 
such  beyond  the  competence  of  the  Federal  Parliament.^  But  the 
principles  adopted  in  the  case  for  ascertaining  a  "fair  and  reason- 
able" minimum  wage  have  survived  and  are  substantially  accepted, 
I  believe  universally,  in  the  industrial  life  of  Australia. 

In  the  first  true  arbitration  case— that  relating  to  ship's  cooks, 

bakers,  etc.— the  standard  of  7  s.  per  day  was  attacked  by  employers, 

but  I  do  not  think  that  it  has  been  attacked  since,  probably  because 

the  cost  of  living  has  been  rising.    The  Court  announced  that  it 

^King  V.  Barger,  Commonwealth  v.  McKay,  6  Com.  Law  Rep.  41  (1908). 


670       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

would  ascertain  first  the  necessary  living  wage  for  the  unskilled 
laborer,  and  then  the  secondary  wage  due  to  skill  or  other  excep- 
tional qualifications  necessary.  Treating  marriage  as  the  usual 
fate  of  adult  men,  a  wage  which  does  not  allow  of  the  matrimonial 
condition  and  the  maintenance  of  about  five  persons  in  a  home 
would  not  be  treated  as  a  living  wage.  As  for  the  secondary  wage, 
it  seemed  to  be  the  safest  course,  for  an  arbitrator  not  initiated 
into  the  mysteries  of  the  several  crafts,  to  follow  the  distinctions 
in  grade  between  employees  as  expressed  in  wages  for  many 
years. 

The  distinction  between  the  basic  or  primary  or  living  wage  and 
the  secondary  wage  attributable  to  exceptional  qualifications  neces- 
sary for  the  performance  of  the  function  is  not  fanciful;  it  was 
forced  on  the  Court  by  the  problems  presented  and  by  the  facts  of 
industrial  life.  Yet  it  has  to  be  borne  in  mind  that  though  the 
essential  natural  needs  come  first,  the  conventional  needs  (for  ex- 
ample, of  artisans  as  distinguished  from  laborers)  become,  by  usage, 
almost  equally  imperative.^ 

The  following  propositions  may,  I  think,  be  taken  to  be  estab- 
lished in  the  settlement  of  minimum  wages  by  the  Court ;  and  it  is 
surprising  to  find  how  often,  as  the  principles  of  the  Court's  action 
come  to  be  understood  and  appreciated,  they  guide  parties  disputing 
to  friendly  collective  agreements,  without  any  award  made  by  the 
Court. 

1.  One  cannot  conceive  of  industrial  peace  unless  the  employee 
has  secured  to  him  wages  sufficient  for  the  essentials  of  human 
existence.^ 

2.  This,  the  basic  wage,  must  secure  to  the  employee  enough 
wherewith  to  renew  his  strength  and  to  maintain  his  home  from 
day  to  day.^ 

3.  The  basic  wage  is  the  same  for  the  employee  with  no  family 
as  for  the  employee  with  a  large  family.  It  rests  on  Walt  Whitman's 
"divine  average,"  and  the  employer  need  not  concern  himself  with 
his  employee's  domestic  affairs. 

^Engine  Drivers,  7  Com.  Arb.  132,  139  (1913). 

2Boot  Factories,  4  Com.  Arb.  i,  10  (1910) ;  Seamen,  5  Com.  Arb.  147,  164 
(1911). 

3  Broken  Hill  Mine,  3  Com.  Arb.  i,  20  (1909). 


y^i 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       671 

4  The  secondary  wage  is  remuneration  for  any  exceptional  gifts  [ 
or  qualifications,^  not  of  the  individual  employee,  but  gifts  or  quali- 
fications necessary  for  the  performance  of  the  functions  ;  for  example, 
skill  as  a  tradesman,  exceptional  heart  and  physique  (as  m  the  case 
of  a  gas  stoker), 2  exceptional  muscular  training  and  power  (as  m  the 
case  of  a  shearer),^  exceptional  responsibility  (for  example,  for 
human  life,  as  in  the  case  of  winding  or  locomotive  engine  drivers).* 

5.  The  secondary  wage,  as  far  as  possible,  preserves  the  old  mar- . 
gin  between  the  unskilled  laborer  and  the  employee  of  the  skilled  [ 

or  exceptional  class.^ 

6  After  ascertaining  the  proper  wages,  basic  and  secondary,  the 
Court  considers  any  evidence  adduced  to  show  that  the  employers 
ought  not  to  be  asked  to  pay  such  wages.«  It  will  consider  grounds 
of  finance,  of  competition  with  imports,  of  unfairness  to  other  workers, 
of  undue  increase  in  prices  of  the  product,  of  injury  to  the  public,  etc. 

7  The  wages  cannot  be  allowed  to  depend  on  the  profits  made  by 
the  individual  employer,  but  the  profits  of  which  the  industry  is 
capable  may  be  taken  into  account.  If  the  industry  is  novel,  and 
those  who  undertake  it  have  to  proceed  economically,  there  may  be 
a  good  cause  for  keeping  down  wages,  but  not  below  the  basic  wage, 
which  must  be  sacrosanct.  Above  the  basic  wage  bargaining  of  the 
skilled  employee  may,  with  caution,  be  allowed  to  operate.^ 

8  The  fact  that  a  mine  is  becoming  exhausted  or  poorer  in  its 
ores  is  not  a  ground  for  prescribing  a  lower  rate  than  would  other- 
wise be  proper.  If  shareholders  are  willing  to  stake  their  own  money 
on  a  speculation,  they  should  not  stake  part  of  the  employee's  proper 
wages  also.  The  Court  cannot  endanger  industrial  peace  in  order 
to  keep  unprofitable  mines  going  .^ 

iBoot  Factories,  4  Com.  Arb.  i,  10  (1910) ;  Postal  Electricians,  7  Com.  Arb. 
5,  10  (1913)  ;  Builders'  Laborers,  7  Com.  Arb.  210,  217  (iQiS). 
'-^Gas  Employees,  7  Com.  Arb.  58,  71  (1913). 

3  Shearers,  5  Com.  Arb.  48,  79  d 9")- 

4  Engine  Drivers,  5  Com.  Arb.  9,  21  (1911).  *  u      .    ^,    ^. 
5McKay,  2  Com.  Arb.  i,  16  (1907) ;  Ship's  Cooks,  2  Com.  Arb.  55.  65,  66 

(1908). 

6  Broken  Hill  Mine,  3  Com.  Arb.  i,  31  (1909). 

Ubid.  32;  Shearers,  5  Com.  Arb.  48,  73  (i9ii) ;  Ship's  Officers,  6  Com.  Arb. 

'  sBroktn  HiU  Mine,  supra,  33-34;  Engine  Drivers,  7  Com.  Arb.  132,  i39 
(1913). 


\ 


■^■I^^^^'^^'^^f,^ 


'iiR 


672       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

9.  The  Court  does  not  increase  the  minimum  on  the  ground  of 
affluence  of  the  employer.  It  is  not  affected  by  the  fact  that  one 
of  the  employers  can,  by  skillful  management,  by  enterprise,  or  by 
good  fortune,  make  very  large  profits.^ 

10.  The  minimum  rate  must  be  based  on  the  highest  function  that 
the  employee  may  be  called  on  to  exercise.  The  employer  must  not 
give  a  plumber  laborer's  work  and  pay  him  laborer's  wages  if  he  has 
also  to  do  plumbing.- 

11.  In  finding  the  proper  minimum  rate  the  Court  tries  to  find 
what  would  be  proper  for  an  employee  of  average  capacity  called 
upon  to  do  work  of  the  class  required.  If  the  employer  desires  to 
secure  the  services  of  an  exceptional  workman,  he  is  free  to  do  so. 

\  The  payment  of  higher  rates  is  left  to  the  play  of  bargaining.^ 

12.  The  Court  does  not  attempt  to  discriminate  in  wages  on  the 
ground  of  comparative  laboriousness.  Discrimination  on  such  a 
ground  is  neither  safe  nor  sound.  The  Court  declined  to  give  an 
extra  rate  to  hodmen  if  they  carry  beyond  a  certain  height.* 

13.  The  Court  will  not  discriminate  in  wages  as  between  the 
several  states  so  as  to  interfere  with  the  freedom  of  trade  between 
the  states  provided  by  the  Constitution."' 

14.  The  Court  will  not  keep  down  wages  on  steamers  so  as  to 
enable  them  to  beat  state  railways  in  competition  or  to  help  one 
competitor  against  another.*' 

15.  The  Court  accepts  and  follows  the  usual  practice  of  making 
rates  for  casual  employment  higher  than  the  corresponding  rates  for 
continuous  employment.'^ 

16.  The  Court,  in  obedience  to  the  act,  provides  exceptions  to 
the  minimum  rate  in  the  case  of  aged,  slow,  or  infirm  workers,  but 
the  exceptional  cases  must  be  disclosed  to  the  representative  of  the 
union  and  be  well  safeguarded.^ 

1  Seamen,  5  Com.  Arb.  147,  164  (1911);  Gas  Employees,  7  Com.  Arb,  58, 

72  (1913)- 

2  Postal  Electricians,  7  Com.  Arb.  5,  8-9  (1913). 

^Ship's  Stewards,  4  Com.  Arb.  61,  63,  68  (1910) ;  Engine  Drivers,  5  Com. 
Arb.  9,  IS  (1911);  Shearers,  S  Com.  Arb.  48,  91  (1911);  Builders'  Laborers, 
7  Com.  Arb.  210,  223  (1913). 

^Ibid.  231. 

5 Constitution,  Section  92;  Boot  Factories,  4  Com.  Arb.  i,  13  (1910). 

«  Ship's  Officers,  6  Com.  Arb.  6,  22  (1912). 

'"Builders'  Laborers,  7  Com.  Arb.  210,  218  (1913). 

8 Act,  Section  40;  Boot  Factories,  4  Com.  Arb.  i,  24  (1910). 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       673 

17.  But  the  Court  will  not  provide  exceptions  to  the  minimum  rate 
for  ''improvers,"  men  paid  more  than  boys  and  less  than  journey- 
men, men  who  are  used  to  beat  down  the  claims  of  competent 
journeymen  and  are  thus  a  perpetual  menace  to  the  peace  of  the 

community.^ 

18.  The  Court  regards  the  old  system  of  apprenticeship  as  un- 
suitable for  factories  under  modern  conditions,  and  it  objects  to 
fixing  a  rigid  proportion  of  apprentices  to  journeymen  without  regard 
to  the  circumstances ;  for  example,  the  character  of  the  output  of  each 
factory.  But  if  conditions  of  apprenticeship  are  in  dispute,  the  Court 
will,  especially  if  both  sides  wish  it,  and  for  the  sake  of  peace  as  well 
as  efficiency,  make  regulations  on  the  subject.  The  proper  method, 
however,  seems  to  be,  in  boot  factories,  to  coordinate  the  work  of  the 
factories  with  the  work  of  the  technical  schools.^ 

19.  The  Court  will  not  prescribe  extra  wages  to  compensate  for 
unnecessary  risks  to  the  life  or  health  of  the  employee  or  unnecessary 
dirt.  No  employer  is  entitled  to  purchase  by  wages  the  right  to 
endanger  life  or  to  treat  men  as  pigs.^ 

20.  The  Court  gives  weight  to  existing  conventions,  usages,  prej- 
udices, exceptional  obligations  and  expenses  of  the  employee;  for 
instance,  that  masters  and  officers  are  required  to  keep  up  a  certain 
appearance,  and  that  stewards  must  provide  themselves  with  uniform 
and  laundry.* 

21.  Where  it  is  established  that  there  is  a  marked  difference  in  the 
cost  of  living  between  one  locality  and  another  the  difference  will,  so 
far  as  possible,  be  reflected  in  the  minimum  wage.^ 

22.  But  where,  as  in  the  case  of  the  wharf  laborers  at  ports,  all 
the  employees  and  nearly  all  the  employers  desire  that  there  should 
be  no  differentiation  the  Court  bases  the  minimum  wage  on  the  mean 
Australian  cost  of  living.^ 

^Ibid.  16. 

2Boot  Factories,  4  Com.  Arb.  i,  19,  20  (1910). 

3 Ship's  Cooks,  2  Com.  Arb.  55,  59,  60  (1908) ;  Seamen,  5  Com.  Arb.  147,  164 

(1911). 

4 Ship's  Officers,  4  Com.  Arb.  89,  93,  95  (iQio) ;  Ship's  Stewards,  4  Com.  Arb. 

61,  66  (1910). 

sBroken  Hill  Mine,  3  Com.  Arb.  i,  28-30  (1909) ;  Engine  Drivers,  S  Com. 
Arb.  9,  23  (1911);  7  Com.  Arb.  132,  141  (1913)  i  Fruit-growers,  6  Com.  Arb. 
61,  69  (1912) ;  Gas  Employees,  7  Com.  Arb.  58,  70-74  (1913);  Builders'  Laborers, 
7  Com.  Arb.  210,  221  (1913)- 

6 Wharf  Laborers,  8  Com.  Arb.  (1914)- 


674       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

23.  In  cases  such  as  that  of  ship's  stewards,  where  the  employees 
usually  receive  from  passengers  "tips"  (or  "bunce"),  the  average 
amount  of  the  tips  must  be  taken  into  account  in  finding  whether  the 
employee  receives  a  living  wage.  But  the  minimum  wage  will  be 
raised  to  its  proper  level  if  the  practice  of  tipping  can  be  stopped.^ 

24.  In  cases  where  employees  are  ''kept,"  found  in  food  and  shelter 
by  the  employer,  the  value  of  the  "keep"  is  allowed  in  reduction  of 
the  wages  awarded.  At  a  time  when  the  keep  of  single  men,  such 
as  laborers,  cost  in  lodgings  usually  155.  per  week  the  Court  reduced 
the  wages  by  10  s.  only.  For  the  15  ^.  at  the  family  home  would  go 
further  than  it  would  go  for  board  and  lodging  outside  the  home ;  and 
the  employer  who  feeds  a  large  number  of  men  can  buy  the  necessary 
commodities  in  large  quantities  and  on  advantageous  terms.  The 
105.  per  week  seemed  to  represent  fairly  the  amount  of  expenditure 
of  which  the  home  was  relieved  by  the  absence  of  the  man.^ 

25.  The  principle  of  the  living  wage  has  been  applied  to  women, 
but  with  a  difference,  as  women  are  not  usually  legally  responsible 
for  the  maintenance  of  a  family.  A  woman's  minimum  is  based  on 
the  average  cost  of  her  own  living  to  one  who  supports  herself  by  her 
own  exertions.  A  woman  or  girl  with  a  comfortable  home  cannot 
be  left  to  underbid  in  wages  other  women  or  girls  who  are  less 
fortunate.^ 

26.  But  in  an  occupation  in  which  men  as  well  as  women  are 
employed  the  minimum  is  based  on  a  man's  cost  of  living.  If  the 
occupation  is  that  of  a  blacksmith,  the  minimum  is  a  man's  mini- 
mum ;  if  the  occupation  is  that  of  a  milliner,  the  minimum  is  a 
woman's  minimum;  if  the  occupation  is  that  of  fruit  picking,  as 
both  men  and  women  are  employed,  the  minimum  must  be  a  man's 
minimum.* 

27.  As  regards  hours  of  work,  when  disputed,  the  Court  usually 
adheres  to  the  general  Australian  standard  of  forty-eight  hours; 
generally  eight  and  three-quarters  hours  on  five  days,  four  and  one- 
quarter  hours  on  Saturday.  But  in  exceptional  cases  the  Court 
has  reduced  the  hours:  in  one  case  because  of  the  nerve-racking 

^Ship's  Stewards,  4  Com.  Arb.  61,  64  (1910). 

2  Ship's  Cooks,  2  Com.  Arb.  55,  62  (1908) ;  Ship's  Stewards,  4  Cora.  Arb.  61, 
63  (1910). 

3 Fruit-growers,  6  Com.  Arb.  61,  71  (1912). 
*Ibid.  72. 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       675 

character  of  the  occupation;^  in  another  case,  that  of  builders' 
laborers,  because  the  men  have  to  "  follow  their  job,"  spending  much 
of  their  own  time  in  traveling.^ 

28.  The  Court  has  conceded  the  eight  hours'  day,  at  sea  as  well  as 
in  port,  to  deck  hands  on  ships,^  to  officers  on  ships,*  to  marine 
engineers.'^  But  there  are  sundry  necessary  exceptions,  and  the 
Master  retains  the  absolute  right  to  call  on  any  man  in  emergencies 
involving  the  safety  of  the  ship ;  and  for  other  purposes  he  may  call 
on  any  man,  paying  extra  rates  for  the  overtime.  The  hours  of  navi- 
gating officers  were  sometimes  shocking  and  involved  danger  to  ship, 
cargo,  and  passengers.*^ 

29.  In  certain  exceptional  cases  the  Court  has  granted  a  right  to 
leave  of  absence  for  two  or  three  weeks  on  full  pay  to  employees  after 
a  certain  length  of  continuous  service;  not,  of  course,  to  casual  or 
temporary  employees.'^ 

30.  The  Court  refuses  to  dictate  to  employers  what  work  they 
should  carry  on,  or  how ;  or  what  functionaries  they  should  employ, 
or  what  functions  for  each  employee  ;  or  what  tests  should  be  applied 
to  candidates  for  employment.^ 

31.  The  Court  leaves  every  employer  free  to  carry  on  the  business 
on  his  own  system,  so  long  as  he  does  not  perpetuate  industrial  trouble 
or  endanger  industrial  peace ;  free  to  choose  his  employees  on  their 
merits  and  according  to  his  exigencies;  free  to  make  use  of  new 
machines,  of  improved  methods,  of  financial  advantages,  of  advan- 
tages of  locality,  of  superior  knowledge;  free  to  put  the  utmost 
pressure  on  anything  and  everything  except  human  life.^ 

32.  As  regards  complaints  of  disagreeable  or  onerous  conditions, 
the  Court  treats  as  fundamental  the  consideration  that  the  work  of 

1  Postal  Electricians,  7  Com.  Arb.  5,  15-16  (1913). 

2Builders'  Laborers,  7  Com.  Arb.  210,  228-229  (1913). 

^Seamen,  5  Com.  Arb.  147,  159,  160  (1911). 

4 Ship's  Officers,  4  Com.  Arb.  89,  99  (iQio). 

^Marine  Engineers,  6  Com.  Arb.  95,  107  (1912). 

eShip's  Officers,  6  Com.  Arb.  6,  16,  17  (1912). 

"^Jbid.  15,  25;  7  Com.  Arb.  92,  104  (1913) ;  Postal  Electricians,  7  Com.  Arb. 

S,  17  (1913)- 

8 Broken  Hill  Mine,  3  Com.  Arb.  i,  36  (1909);  Postal  Electricians,  7  Com. 

Arb.  s,  7,  8,  13,  18,  19  (1913). 

9Boot  Factories,  4  Com.  Arb.  i,  18  (1910) ;  Shearers,  5  Com.  Arb.  48,  100 
(1911);  Fruit-growers,  6  Cora.  Arb.  61,  75  (1912);  Gas  Employees,  7  Com. 
Arb.  58,  77  (1913)- 


ii 


676       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  ship,  factory,  mine,  etc.  must  be  done,  a  consideration  next  in 
order  to  that  of  the  essential  needs  of  human  life.  An  order  will 
not  be  made  that  is  inconsistent  with  the  effective  management  of 

the  undertaking.^ 

33.  On  the  same  principle  the  Court  steadily  refuses  to  make 
orders  which  would  militate  against  the  public  interest  or  conven- 
ience. It  has  refused  to  order  prohibitive  overtime  rates  for  leaving 
port  on  Sundays ;-  it  has  refused  to  forbid  the  employment  of  casuals 
or  to  forbid  "broken  time"  in  tramway  services.  Casuals  or  ''broken 
time,"  or  both,  are  necessary  to  meet  the  extra  traffic  at  certain 
times  of  the  day.^ 

These  are  some  of  the  principles  of  action  adopted  by  the  Court. 
But,  it  may  be  asked,  what  about  piecework  ?  How  does  the  Court 
fix  piecework  rates?  The  first  great  case  in  which  piecework  rates 
were  directly  involved  was  that  of  the  Shearers.*  At  the  time  of 
the  arbitration  wool  furnished  nearly  forty  per  cent  of  the  exports  of 
Australia,  nearly  £29,000,000  per  annum,  in  addition  to  the  wool 
used  in  Australia.  In  that  case  the  Court  prescribed  the  piecework 
rates  on  a  time-work  basis — found  the  piecework  rates  which  would 
enable  an  average  shearer  to  earn  such  wages  per  week  as  would  be 
the  just  minimum  for  a  man  with  the  qualifications  of  a  shearer  if 
he  were  paid  by  time.  Having  found  that  the  shearer  should,  as  a 
"  skilled  "  worker,  get  a  net  wage  of  £3  per  week  for  the  time  of  his  ex- 
pedition to  the  sheep  stations  to  shear,  and  having  found  that  a  rate 
of  245.  per  100  sheep  would  give  this  net  result,  the  Court  fixed  24s. 
per  100  as  the  minimum  rate. '  In  finding  the  net  returns  of  the  whole 
expedition  allowances  had  to  be  made  for  days  of  traveling  and  wait- 
ing, expenses  en  route,  cost  of  mess  and  combs  and  cutters.®  This 
system  of  finding  the  net  result  of  the  expedition,  and  what  would 
be  a  fair  return  for  the  expedition,  was  also  adopted  in  the  case  of 
persons  employed  by  fruit-growers  on  the  River  Murray.^  Some- 
times the  Court  protects  pieceworkers  in  making  their  bargain  by 

1  Ship's  Stewards,  4  Com.  Arb.  61,  73  (1910) ;  Ship's  Officers,  4  Com.  Arb. 
89,  loi  (1910). 

2 Seamen,  5  Com.  Arb.  147,  160  (loii). 

3 Tramways,  6  Com.  Arb.  130,  144  (191 2). 

*S  Com.  Arb.  48  (1911). 

^Ibid.  73,  79. 

^Ibtd.  74,  76.  7 Fruit-growers,  6  Com.  Arb.  61,  68  (1912). 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       677 

prescribing  that  their  remuneration  shall  not  fall  below,  in  result,  a 
certain  time-work  minimum.^ 

The  system  of  arbitration  adopted  by  the  act  is  based  on  union- 
ism. Indeed,  without  unions  it  is  hard  to  conceive  how  arbitration 
could  be  worked.  It  is  true  that  there  are  methods  provided  by  which 
the  Court  can  intervene  for  the  preservation  of  industrial  peace  even 
when  its  powers  are  not  invoked  by  any  union ;  but  no  party  can 
file  a  plaint  for  the  settlement  of  a  dispute  except  an  "organization"; 
that  is  to  say,  a  union  of  employers  or  of  employees  registered  under 
the  act.2  One  of  the  "chief  objects"  of  the  act,  as  stated  in  Sec- 
tion 2,  is  "to  facilitate  and  encourage  the  organization  of  representa- 
tive bodies  of  employers  and  of  employees  and  the  submission  of 
industrial  disputes  to  the  Court  by  organizations";  and  it  follows 
that  the  Court  will  not  assist  an  employer  in  devices  to  stamp  out 
unionism.^  It  is,  of  course,  better  for  an  employer  that  he  should 
not  be  worried  by  complaints  of  individual  employees  and  that  any 
complaints  should  be  presented  collectively  by  some  responsible 
union.  He  has  then  the  advantage  of  being  able  to  deal  with  his 
employees  on  a  consistent  scheme,  equitable  all  round  the  service,  and 
his  time  is  not  taken  up  by  petty  complaints  or  individual  fads.  A 
demand  made  on  him  comes  from  a  responsible  executive,  with  the 
consent,  direct  or  indirect,  of  the  organized  body  of  members  of  the 
union.  Moreover,  from  the  point  of  view  of  the  employees,  it  is 
better  that  an  individual  employee  should  not,  by  complaining,  incur 
the  risk  of  becoming  a  marked  man  or  of  being  removed,  and  the 
individual  employee  is  generally  powerless.  From  the  point  of  view 
of  the  Court  and  of  the  public,  it  is  fair  to  state  that  in  nearly  every 
case — I  can  only  remember  one  case  to  the  contrary — the  influence 
of  union  leaders  has  always  been  in  the  direction  of  peace.  It 
would  not  be  so,  probably,  if  there  were  no  means  of  obtaining  an 
improvement  of  conditions  except  by  strike,  actual  or  threatened, 
but  in  Australia  the  leaders  can  hold  out  to  the  members  of  the  union 
a  prospect  of  relief,  without  strike,  from  the  Court  or  from  some 
wages  board.*  It  is  significant  that  in  the  one  exceptional  case  re- 
ferred to,  the  leaders  of  the  union  have  been  converted  so  that  they 
are  now  strong  advocates  of  arbitration. 


^Ibid.  75. 
2  Section  19. 


3 Tramways,  6  Com.  Arb.  130,  143  (1912). 

*  Marine  Engineers,  6  Com.  Arb.  95,  100  (1912). 


678       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

But  then  comes  the  difficult  question  of  "preference  to  unionists." 
Preference  to  unionists  is  the  Australian  analogue  of  the  "preferential 
union  shop"  made  familiar  in  some  of  the  garment  industries  of  the 
United  States.  The  act  gives  the  Court  power  to  direct  that  as 
between  members  of  organizations  (unions)  of  employees  and  other 
persons  desiring  employment  at  the  same  time  preference  shall  be 
given  to  such  members,  other  things  being  equal. ^  But  it  is  only 
a  power,  not  a  duty,  to  order  such  preference,  and  the  Court  is  very 
loath  to  exercise  the  power.  "The  absolute  power  of  choice  [between 
applicants  for  employment]  is  one  of  the  recommendations  of  the 
minimum-wage  system  from  the  employer's  point  of  view — he  can 
select  the  best  men  available  when  he  has  to  pay  a  certain  rate."^ 
For  this  reason  preference  was  refused  in  the  case  of  shearers  etc.;^ 
in  the  case  of  seamen;*  in  the  case  of  builders'  laborers.^  Yet  the 
Court  recognizes  the  difficulty  of  the  position.  As  was  said  in  the 
builders'  laborers  case : 

The  truth  is,  preference  is  sought  for  unionists  in  order  to  pre- 
vent preference  of  nonunionists  or  antiunionists — -to  prevent  the 
gradual  bleeding  of  unionism  by  the  feeding  of  nonunionism.  It  is 
a  weapon  of  defense.  For  instance,  some  employers  here  hired  men 
through  the  Independent  Workers'  Federation — a  body  supported 
chiefly  by  employers'  money,  and  devised  to  frustrate  the  ordi- 
nary unions ;  and  those  who  applied  for  work  at  the  office  of  this 
body  would  not  be  introduced  to  the  employer  unless  they  ceased  to 
be  members  of  the  ordinary  unions  and  became  members  of  this 
body.  What  is  to  be  done  to  protect  men  in  the  exercise  of  their 
right  as  free  men  to  combine  for  their  mutual  benefit,  seeing  that  the 
employing  class  has  the  tremendous  power  of  giving  or  withholding 
work  ?  The  only  remedy  that  the  act  provides  is  an  order  for  pref- 
erence ;  and  it  is  doubtful  whether  such  an  order  is  appropriate  or 
effective.  It  is,  indeed,  very  trying  for  men  who  pay  full  dues  to  a 
legitimate  union  to  work  side  by  side  with  men  who  do  not — 
with  men  who  look  to  their  own  interests  only,  seeking  to  curry 
favor  with  the  employers,  getting  the  benefit  of  any  general  rise  in 
wages  or  betterment  of  conditions  which  is  secured  without  their  aid 
and  in  the  teeth  of  their  opposition,  men  who  are  preferred  (other 
things  being  equal)  for  vacancies  and  promotion.    Every  fair  man 

1  Section  40. 

2Engine  Drivers,  5  Com.  Arb.  9,  25  (1911);  7  Com.  Arb.  132,  147  (1913) ; 
Tramways,  6  Com.  Arb.  35,  47  (1912). 
^S  Com.  Arb.  48,  99  (1911). 
*S  Com.  Arb.  147,  170  (1911).  ^y  Com.  Arb.  210,  233  (1913). 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       679 

Recognizes  the  difficulty  of  the  position — every  man  who  is  not  too 
much  of  a  partisan  to  look  sometimes  at  the  other  side  of  the  hedge. 
In  another  case  recently  before  me  a  nonunionist  told  me  that  he 
acted  solely  on  the  basis  of  his  personal  interest,  without  any  regard 
for  the  interests  of  his  fellow  workers.  He  looked  for  favors  to  him- 
self because  he  kept  away  from  those  who  combined  for  the  common 
good  of  the  whole  body.  It  is  not  out  of  consideration  for  such  men 
that  I  refuse  preference;  it  is  rather  out  of  consideration  for  such 
employers  as  honestly  take  the  best  man  available,  unionist  or  not. 
I  do  not  want  them  to  be  harassed  with  the  doubt,  when  select- 
ing men  for  a  post,  whether  they  can  prove  their  appointee  to  be 
better  than  all  the  unionist  applicants.  I  refuse  preference  also  out 
of  consideration  for  many  who  have  not  joined  any  union  simply 
because  they  have  not  felt  the  need.  In  the  case  of  country  building 
work,  for  instance,  it  is  common  for  men  on  farms  etc.,  when  farm 
work  is  not  pressing,  to  take  a  job  as  builders'  laborer.  Why  should 
the  employer  be  compelled  to  bring  union  laborers  from  the  city  ? 
After  all,  the  direct  way  for  unionists  to  counteract  unfair  preference 
of  nonunionists  is  for  the  unionists  to  excel — to  give  to  the  employer 
the  best  service.  It  is  nearly  always  found  that  employers  prefer  a 
first-class  man  who  is  unionist  to  a  second-class  man  who  is 
nonunionist.^ 

The  only  case  in  which  the  Court  has  ordered  preference  is  the 
case  of  a  tramway  company  which  deliberately  discriminated  against 
unionists  and  refused  to  undertake  not  to  discriminate  in  future.-  It 
is  to  be  observed  that  the  Court  is  not  given  power  by  the  act  to 
order  that  the  employer  shall  not  discriminate  against  unionists  in 
giving  or  withholding  employment. 

The  imposition  of  a  minimum  wage,  a  wage  below  which  an  em- 
ployer must  not  go  in  employing  a  worker  of  a  given  character, 
implies,  of  course,  an  admission  of  the  truth  of  the  doctrine  of  modern 
economists,  of  all  schools  I  think,  that  freedom  of  contract  is  a  mis- 
nomer as  applied  to  the  contract  between  an  employer  and  an  ordi- 
nary individual  employee.  The  strategic  position  of  the  employer  in  a 
contest  as  to  wages  is  much  stronger  than  that  of  the  individual  em- 
ployee. "The  power  of  the  employer  to  withhold  bread  is  a  much 
more  effective  weapon  than  the  power  of  the  employee  to  refuse  to 
labor."  ^  Low  wages  are  bad  in  the  worker's  eyes,  but  unemployment, 

17  Com.  Arb.  210,  233-234  (1913)- 
2Tramways,  6  Com.  Arb.  130,  162   (1912). 
sj^ngine  Drivers,  5  Com.  Arb.  9,  27  (1911), 


I    SrI 


680       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

with  starvation  in  the  background,  is  worse.  The  position  was  put 
luminously  once,  as  well  as  with  unconscious  humor,  by  an  em- 
ployer on  whom  a  plaint  was  served  for  settlement  of  a  dispute  by  the 
Court.  In  place  of  filing  an  answer  he  wrote  a  letter  to  the  registrar, 
denying  that  he  was  a  party  to  any  dispute.  "  I  have  never,"  said  he, 
"quarreled  or  disputed  with  a  laborer  of  any  kind.  .  .  .  If  we  cannot 
agree,  well,  we  will  part ;  that  ends  the  whole.  .  .  .  Love  is  the  power 
which  will  end  all  struggles,  not  legislation."  Other  respondents  pin 
their  faith  not  to  "love"  but  to  the  sterner  "law  of  supply  and  de- 
mand." They  treat  this  law  as  being,  in  the  matter  of  wages,  more 
inexorable  and  inevitable  than  even  the  law  of  gravitation,  as  not 
being  subject,  as  laws  of  nature  are,  to  counteraction,  to  control,  to 
direction.  "One  may  dam  up  a  river,  or  even  change  its  course; 
but  one  cannot  [it  is  said]  raise  wages  above  the  level  of  its  unregu- 
lated price,  above  the  level  of  a  sum  which  a  man  will  accept  rather 
than  be  starved." ^  If  the  Court  did  nothing  else  than  drag  such 
theories  into  the  light  of  day  and  into  free  discussion,  it  would  be 
doing  good  service  to  the  community.  But  it  is  coming  to  be  recog- 
nized that  what  the  Court  does  in  fixing  a  minimum  wage  is  by  no 
means  novel  in  principle.  There  are  many  acts  of  many  legislatures 
which  prescribe  minimum  conditions  on  other  subjects.  For  example, 
mining  acts  often  prescribe  minimum  conditions  as  to  ventilation, 
timbering,  safety  appliances,  machinery,  sanitation.  These  matters 
are  not  left  to  individual  bargaining. 

There  are  no  definite  figures  with  regard  to  the  cost  to  the  parties 
of  arbitration  proceedings,  but  the  cost  is  very  slight.  There  are 
seldom  any  costs  incurred  in  employing  lawyers,  for,  under  Section  2  7 
of  the  act,  lawyers  cannot  be  employed  except  with  the  consent  of 
both  parties,  and  the  employees  generally  refuse  their  consent.  The 
secretary  of  the  organization  generally  puts  its  case,  and  the  em- 
ployers or  some  permanent  officer  generally  puts  the  employers'  case. 
The  principal  expense  of  an  arbitration  is  that  of  bringing  wit- 
nesses. If  prohibition  proceedings  are  taken  in  the  High  Court  to 
prevent  the  enforcement  of  an  award  on  the  ground  that  the  Court 
of  Conciliation  has  exceeded  its  jurisdiction  (of  which  I  shall  say 

1  Engine  Drivers,  5  Com.  Arb.  27,  28  (1911)  ;  Ship's  Officers,  6  Cora.  Arb.  6, 
18  (1912)  ;  Marine  Engineers,  6  Com.  Arb.  95,  loi  (1912). 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       681 

more  presently),  no  doubt  heavy,  very  heavy,  expenses  are  incurred, 
but  these  are  not  expenses  of  the  arbitration. 

But  it  has  to  be  admitted  that  proceedings  in  the  Court  of  Con- 
ciliation often  take  a  very  long  time,  sometimes  weeks,  in  a  few  cases 
months.   The  proceedings  cannot  be  otherwise  than  lengthy,  as  the 
disputes  of  which  the  Court  can  take  cognizance  are  so  widespread- 
must  extend  from  one  state  into  one  or  more  other  states.    Moreover, 
the  habit  is  to  bring  before  the  employers,  and  afterwards  before  the 
Court,  a  very  long  list  of  conditions  in  dispute,  and  the  case  of  each 
employer  has  to  be  fairly  considered  by  the  Court  in  connection  with 
each  grievance.    The  number  of  employers  respondent  to  a  plaint  is 
generally  great.   There  were  311  employers  in  the  Engine  Drivers' 
case,^  570  in  the  case  of  the  Builders'  Laborers,^  650  in  that  of  the 
Fruit-growers,^  and  2549  at  least  in  that  of  the  Shearers.*     The 
Court  has  no  power  to  make  an  award  a  common  rule  of  the  industry  ; 
it  cannot  investigate  and  settle  the  proper  conditions  to  be  applied 
in  one  typical  undertaking  and  then  extend  the  same  conditions  to 
other  undertakings  of  the  same  character.    The  act  purported  to  give 
this  power  to  the  Court,  but  it  was  held  by  the  High  Court,  on  a  case 
stated,  that  the  act  was  in  this  respect  unconstitutional  and  invalid.^ 
This  want  of  power  to  make  a  common  rule  for  the  industry  not  only 
lengthens  the  proceedings  but  it  also  may  operate  to  the  prejudice  of 
the  employers  who  are  bound  by  the  award.    For  the  Court  can  deal 
only  with  employers  who  employ  members  of  the  union.    Some  rival 
employers  may  have  no  members  of  the  union  in  their  employment 
and  therefore  have  to  be  excluded  from  the  award.    Their  hands  are 
free  as  to  wages,  while  the  hands  of  the  others  are  fettered,  and  this 
is,  of  course,  unfair  as  between  competitors  in  the  trade.    In  one  case, 
that  of  the  Boot  Factories,^  the  difficulty  was  met  by  the  employers 
and  employees  concurring  in  an  application  before  the  wages  boards 
of  each  of  the  states  concerned  to  have  the  terms  of  the  award  made  a 
common  rule  for  the  state.    But  this  remedy  is  not  always  available. 

17  Com.  Arb.  132  (1913)- 

27  Com.  Arb.  210  (1913)- 

36  Com.  Arb.  61,  65  (1912). 

45  Com.  Arb.  48,  65  (1911)- 

6  Boot  Factories,  11  Com.  Law  Rep.  311  (1910). 

«4  Com.  Arb.  i  (1910) ;  Builders'  Laborers,  7  Com.  Arb.  210,  235  (1913)- 


I 


W 


Hi 


I 


U-M 


I* 


682       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

There  is  a  provision  in  the  act^  enabling  the  Court  to  appoint 
a  Board  of  Reference,  assigning  to  it  the  function  of  determining 
specified  matters  which  under  the  award  may  require  to  be  deter- 
mined. Such  a  provision,  if  properly  drafted  and  valid,  would  be 
of  eminent  service  to  p^ace.  Difficulties  often  arise  under  an  award, 
owing  to  the  vast  variety  of  methods  in  the  different  undertakings, 
as  to  the  application  of  the  words  of  the  award  to  some  particular 
case.  These  and  other  difficulties  ought  to  be  met  by  collective  ad- 
justment between  representatives  of  the  employers  on  the  one  side 
and  the  representatives  of  the  union  on  the  other,  with  a  neutral 
chairman ;  but  from  the  nature  of  the  case  there  would  have  to  be 
a  separate  board  in  each  of  the  centers  of  the  industry.  Nothing 
would  tend  more  to  prevent  serious  friction  and  to  promote  mutual 
understanding  of  employers  and  employees.  ''A  suitable  Board  of 
Reference,  under  the  aegis  of  a  strong  union,  is  a  safety  valve  for  any 
industry."-  But,  unfortunately,  as  the  section  stands,  with  the  in- 
terpretation put  upon  it  by  the  High  Court,  it  is  practically  use- 
less. The  parties  on  both  sides  of  a  dispute  often  seek  a  board, 
or  rather  boards,  of  reference,^  but  the  Court  cannot  generally 
help  them.  Sometimes,  however,  the  parties  to  the  dispute  make 
and  file  agreements  between  the  union  and  the  several  employers 
for  a  board  and  leave  the  Court  to  award  on  the  other  subjects  in 
dispute ;  and  the  agreements  are  certified  by  the  Court,  and  on 
being  filed  under  Section  24  have  the  same  binding  effect  as  an 
award.* 

There  are  two  important  powers  of  which  the  Court  has  frequently 
availed  itself,  or  threatened  to  avail  itself,  with  very  excellent  effect.^ 
These  are  (i)  the  power  to  withhold  an  award  if  it  appear  "that 
further  proceedings  by  the  Court  are  not  desirable  in  the  public 
interest,"*^  and  (2)  the  power  to  vary  an  award.^  Sometimes  the 
employees,  though  seeking  an  award,  have  taken  up  an  obstinate 
attitude,  intimating  in  effect  that  if  the  award  does  not  meet  their 
wishes  they  will  not  abide  by  it ;  and  the  Court  has  plainly  intimated 

1  Section  40  a. 

2  Engine  Drivers,  7  Com.  Arb.  132,  144  (1913). 

*  Seamen,  6  Com.  Arb.  59  (1912). 

*  Engine  Drivers,  7  Com.  Arb.  132,  135  (1913). 
5  Fruit-growers,  6  Com.  Arb.  61,  78  (1912). 

^  Section  38  /t.  ''Section  38  0. 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       683 

that  it  will  not  proceed  with  the  arbitration  on  such  terms .^  It 
cannot  be  for  the  public  interest  to  proceed  with  the  arbitration 
under  such  a  constraint.  Arbitration  by  the  Court  is  meant  to  be 
a  substitute  for  the  method  of  strike,  and  "you  cannot  have  award 
and  strike  too."^  In  one  case,  while  the  Court  was  preparing  an 
award  for  seamen  and  firemen  information  came  that  the  firemen  of 
the  S.  S.  Koombana  refused  to  work  on  the  ship  unless  a  certain  chief 
steward  were  removed.  The  position  was  serious ;  the  ship  carried 
the  mails,  as  well  as  passengers  and  cargo,  for  ports  on  the  West 
Australian  coast.  There  was  an  agreement  in  existence  under  which 
it  was  a  breach  of  agreement  on  the  part  of  the  union  if  by  reason 
of  any  dispute  a  vessel  were  detained  twenty-four  hours.  The  Court 
intimated  that  it  would  not  make  its  award  so  long  as  the  agreement 
was  not  observed.  As  a  result  officials  of  the  union  conducted  suit- 
able firemen  to  the  port  where  the  vessel  lay,  put  them  on  board,  and 
the  Koombana  went  on  its  way ;  then,  and  not  till  then,  the  Court 
gave  its  award. ^ 

The  power  to  vary  an  award  has  also  been  held  over  the  head  of 
a  recalcitrant  union.  It  is  not  fair  to  keep  the  employers  bound 
by  the  award  if  the  union  takes  the  benefit  of  the  award  and  rejects 
the  burden.  The  Court  has  power  to  lower  or  annul  the  minimum 
wage  in  such  a  case  if  necessary.*  Fortunately,  it  never  has  been 
necessary.  I  may  give  one  case  in  point.  The  wharf  laborers  were 
on  strike  in  Brisbane ;  seamen  who  were  enjoying  the  benefit  of  an 
award  were  ordered  to  unload  their  vessel.  They  were  naturally 
indisposed  to  comply,  but  before  refusing  they  telegraphed  to  the 
executive  of  their  union  for  directions.  They  were  told  by  the 
executive  to  unload  or  they  would  lose  the  award.    They  unloaded. 

Another  very  valuable  power  is  that  conferred  by  Parliament  in 
19 10,  under  which  the  president  may,  when  a  dispute  exists  or  is 
threatened,  summon  any  person  to  attend  a  conference  in  his  pres- 
ence. The  attendance  is  compulsory,  enforceable  by  penalty.^  Fre- 
quently a  quiet  talk  at  such  a  conference  has  prevented  a  strike 

^Gas  Employees,  7  Com.  Arb.  58,  62  (1913) ;  Broken  Hill  Mine,  3  Com. 
Arb.  I,  20  (1909). 

2  Liquor  Trade,  7  Com.  Arb.  255  (1913). 

3  Seamen,  s  Com.  Arb.  147,  173-174  (1911). 
*  Fruit-growers,  6  Com.  Arb.  61,  78  (1912). 
'^Section  id  a. 


■A 


ill 


: 


II 


|l 


If' 


684       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

which  was  imminent.^  Frequently  the  parties  arrange  to  proceed  for 
arbitration  and  make  temporary  arrangements  for  carrying  on  work 
until  the  award.-  Sometimes  an  actual  strike,  confined  to  one  state 
though  the  dispute  extended  to  two  states,  has  been  stopped,  the 
men  going  back  to  work  at  the  old  rates  until  the  award.^  A  further 
amendment  was  made  in  the  act  in  191 1,  under  which,  if  no  agree- 
ment has  been  reached  at  the  conference,  the  president  can  refer 
the  dispute  to  the  Court  for  arbitration.*  The  fact  that  this  whip 
is  in  the  hands  of  the  president,  to  be  used  in  the  last  resort,  and 
that  the  party  with  the  stronger  position  for  the  time  being  will  have 
to  submit  to  an  award  if  he  takes  up  an  obstinate  attitude  against  all 
agreement,  is  found  to  operate  as  a  strong  inducement  to  compromise 
and  to  reasonable  arrangements  by  consent.  Agreements  in  lieu  of 
award  have  often  been  fixed  up  in  a  conference  or  as  the  result  of 
a  conference.^  The  agreements  are  generally  produced  in  court  when 
the  case  is  called  on,  and  the  president  certifies  to  them  and  has  them 
filed,  and  they  operate — are  enforceable — as  an  award.'''  In  one  long 
case,  where  the  Court  was  faced  with  a  dispute  in  ten  tramway  under- 
takings, no  less  than  eight  of  the  undertakings  arranged  agreements 
during  the  course  of  the  long  hearing,  with  the  assistance  of  the 
president  given  in  frequent  interviews  with  the  parties  in  chambers.^ 
It  must  not  be  supposed  that  the  desire  for  the  assistance  of  the 
president  or  of  the  Court  is  confined  to  employees.  At  first  there 
was  a  tendency  on  the  part  of  employers,  individually  and  in  asso- 
ciation, to  resent  interference,  as  preventing  the  employers  from 
carrying  on,  as  they  said,  their  own  business  in  their  own  way.    But 

1  Seamen,  4  Com.  Arb.  108  (1910);  5  Com.  Arb.  147,  154  (iQ")  ;  Fruit- 
growers, 5  Com.  Arb.  37,  183  (1911);  6  Com.  Arb.  61,  62  (1912);  Steamboat 
Enginemen,  6  Com.  Arb.  60  (1912);  Bakers,  7  Com.  Arb.  257-258  (1913). 

2  Export  Butchers,  4  Com.  Arb.  82,  87  (1910) ;  Glass  Bottle  Makers,  6  Com. 
Arb.  176  (1912);  Steamboat  Enginemen,  7  Com.  Arb.  37  (1913) ;  Bakers,  7 
Com.  Arb.  257-258  (1913)- 

3 Export  Butchers,  7  Com.  Arb.  52-54  (1913)- 
*  Section  ig  d. 

5  Engine  Drivers,  6  Com.  Arb.  126  (1912)  ;  Glass  Bottle  Makers,  6  Com.  Arb. 
176  (1912);  7  Com.  Arb.  43  (1913)  ;  Seamen  (as  to  manning),  7  Com.  Arb. 
2  (1913)  ;  jfournalists,  7  Com.  Arb.  112,  113  (1913)  ;  Liquor  Trade,  6  Com. 
Arb.  129  (1912);  7  Com.  Arb.  254  (1913). 

6  Section  24. 

7 Tramways,  6  Com.  Arb.  130,  140  (1912) ;  and  see  Journalists,  7  Com.  Arb. 

112,  113  (1913)- 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       685 

facts  have  been  too  strong  for  them.  Employers  now  frequently 
request  the  president  to  intervene  and  to  summon  a  conference  in 
order  to  prevent  a  stoppage  of  work.^  They  seek  regulation,  by 
agreement  or  award,  in  order  that  they  may  not  find  their  plant 
lying  idle  and  their  business  at  a  standstill,  and,  in  some  cases,  a 

season  lost. 

Perhaps  it  will  be  well  to  give  a  concrete  case.  There  is  in  Vic- 
toria a  great  butchering  trade  in  lambs  for  export,  involving,  I  be- 
lieve, more  than  a  million  pounds  per  annum.  The  lambs  are  sent 
down  to  Melbourne  in  the  spring,— September  or  October,— and 
unless  they  are  butchered  at  once  they  deteriorate  in  condition  and 
the  season  is  lost.  The  men  suddenly  refused  to  go  to  work  at  the 
old  rates ;  telegrams  flew  up  to  the  country  settlements  to  stop  truck- 
ing any  more  lambs;  the  settlers  were  faced  with  the  prospect  of 
losing  their  market,  and  the  storekeeping  and  incidental  industries 
with  the  prospect  of  grievous  loss.  It  so  happened  that  the  same 
demand  was  made  on  employers  in  New  South  Wales,  so  that  there 
seemed  to  be  a  two-state  dispute,  which  gave  jurisdiction  to  the 
president.  A  conference  was  summoned  at  the  request  of  the  em- 
ployers, the  men  induced  to  go  to  work  under  the  conditions  already 
in  operation  on  a  promise  that  the  Court  would  arbitrate  and  make 
the  award  retrospective  to  the  resumption  of  work,  and  the  season 
was  saved.-  The  parties  prepared  themselves  peacefully  to  discuss 
their  differences  before  the  Court,  but— this  is  the  point— the  work 

went  on. 

Another  concrete  case,  showing  the  desire  of  both  sides  for  definite 
regulation  of  conditions  by  the  Court,  is  that  of  the  Ship's  Officers. 
The  men  in  their  demands  had  been  too  specific ;  the  High  Court  had 
decided  that  the  dispute  must  be  treated  as  confined  to  the  specific 
demands  made  and  that  the  Court  of  Conciliation  could  not  prescribe 
a  remedy  for  any  grievance  different  from  that  remedy  demanded. 
The  Court  of  Conciliation  found  that  the  granting  of  the  demands  as 
asked  would  tend  to  promote  strife  rather  than  peace  in  the  industry 

iSeamen,  4  Com.  Arb.  108  (1910)  ;  5  Com.  Arb.  147,  i54  (iQu);  Fruit- 
growers, 5  Com.  Arb.  37  (1911);  Waterside  Workers,  6  Com.  Arb.  3  (1912)  ; 
Glass  Bottle  Makers,  6  Com.  Arb.  176  (1912)  ;  Liquor  Trade,  7  Com.  Arb.  254 
(1913);  Export  Butchers,  7  Com.  Arb.  52  (1913) ;  Victorian  Stevedoring  Co., 
5  Com.  Arb.  i   (1911). 

2 Export  Butchers,  7  Com.  Arb.  52,  54  (1913). 


r 


III 


li  I 


i 


ii  i 


686       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

and  stated  its  difficulties  to  the  parties.  Both  parties  were  so  anxious 
for  a  definite  arrangement  of  conditions  that  they  consented  to  em- 
body in  an  agreement  any  terms  whatever  that  the  president  thought 
proper y  whatever  the  ambit  of  the  dispute,  whatever  the  jurisdiction  of 
the  Court.  The  president  accordingly  continued  the  hearing  of  the 
case  and  drew  up  an  agreement  which  both  parties  signed  and  which 
they  have  both  loyally  observed.^ 

There  is  such  a  strong  desire  for  the  assistance  of  the  machinery 
of  the  act  that  on  several  occasions  an  attempt  has  been  made  by 
employers,  with  or  without  the  concurrence  of  employees,  to  induce 
the  president  to  intervene  in  cases  in  which  he  has  had  to  refuse  his 
assistance  on  the  ground  that  the  dispute  does  not  extend  beyond 
one  state  and  must  be  dealt  with,  if  at  all,  by  state  authorities.'-  Quite 
recently  the  president  has  had,  however,  to  make  an  exception  to  his 
rule  not  to  meddle,  even  by  consent,  with  matters  outside  his  juris- 
diction. There  was  a  dispute  between  laborers  and  artisans  on  the 
one  side  and  the  commonwealth  government  on  the  other  as  to  con- 
ditions of  labor  in  the  construction  of  a  naval  base  in  Western  Port, 
Victoria  ;  all  parties  signed  a  submission  to  arbitration,  leaving  every- 
thing to  the  determination  of  the  president  as  in  a  voluntary  arbitra- 
tion. In  view  of  the  serious  effects  of  a  stoppage  of  the  works  in 
time  of  war,  the  president  consented  to  act,  heard  the  parties,  and 
gave  an  award,  and  the  parties  are  peacefully  acting  in  accordance 
with  it.^ 

But  the  course  of  the  Court,  like  the  course  of  true  love,  does  not 
always  run  smooth.  It  has  to  meet  some  bitter  opposition.  Some- 
times the  opposition  comes  from  a  union  of  employees — generally 
a  union  which  avowedly  accepts  the  doctrine  of  the  "  class  war "  and 
aims  at  "the  emancipation  of  labor  by  the  abolition  of  the  wage 
system."*  I  have  even  seen  a  cartoon  in  a  labor  newspaper  showing 
a  laborer  walking  towards  a  gate  marked  "  Freedom,"  and  a  bulldog 
with  a  collar  marked  "Arbitration"  bars  his  path.  It  is  but  fair  to 
say  that  this  cartoon  appeared  in  a  state  which  has  a  local  arbitration 
court.    But  the  attacks  on  the  Court  and  its  awards  are,  of  course, 

^Ship's  Officers,  4  Com.  Arb.  89,  91  (1910) ;  Hairdressers,  6  Com.  Arb.  i 
(1912). 

2  Victorian  Stevedoring  Co.,  5  Com.  Arb.  i   (1911). 

3  Naval  base — not  reported. 

< Fruit-growers,  6  Com.  Arb.  61,  65,  78  (1912), 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       687 

generally  made  from  the  side  of  employers,  many  of  whom  naturally 
resent  any  curtailment  of  their  powers.  The  applications  for  prohibi- 
tion against  the  president  have  been  sometimes  in  part  or  temporarily 
successful.  Prohibition  is  applied  for  because  of  some  alleged  excess 
of  the  Court's  jurisdiction,  and  the  argument  generally  turns  on  the 
questions.  Was  there  a  dispute  ?  and,  if  there  was.  Did  it  extend  be- 
yond one  state?  Sometimes  the  argument  turns  on  the  validity  of 
some  section  of  the  act.  The  proceedings  are  very  long  and  very 
costly,  and  it  is  astonishing  what  a  wealth  of  learning  is  involved  in 
the  meaning  of  the  word  "dispute"  and  the  words  "extending  beyond 
the  limit  of  any  one  state."  The  discussions  occupy  a  very  consider- 
able proportion  of  the  Commonwealth  Law  Reports,  but  they  would 
not  interest  those  for  whose  information  I  write  this  article.  The 
legal  discussions  do  not  affect  the  principles  or  methods  of  action  of 
the  Court  of  Conciliation  in  cases  where  there  is  jurisdiction. 

It  has  to  be  admitted  that  the  awards,  in  nearly  all  cases,  have 
been  made  in  a  period  when  the  cost  of  living  is  rising  and  that 
therefore  they  have  generally  increased  the  existing  minimum  rate. 
The  Court  found,  about  191 1,  that  the  cost  of  living  was  substantially 
increasing,  but  it  refused  to  raise  the  basic  wage  until  the  increase 
could  be  quantitatively  stated.'  It  suggested  the  expediency  of  official 
statistics  on  the  subject,  and  the  Commonwealth  Statistician  now 
furnishes  periodically  statistics  which  have  materially  assisted  the 
Court.  According  to  the  Commonwealth  Statistician,  the  cost  of 
living,  taking  Australia  as  a  whole,  has  increased  by  25  per  cent  from 
1 90 1  to  19 13.  For  such  necessaries  as  could  be  bought  in  1901  for  £1 
one  must  now  pay  2  5  s.^  What  will  happen  if  the  cost  of  living  should 
decrease— if  the  minimum  for  the  basic  or  living  wage  shall  have 
to  be  lowered  ?  It  is  a  fair  question,  but  it  is  for  the  future  to  give 
the  answer.  I  wish  to  confine  my  words  to  my  personal  experience. 
Yet  there  have  been  cases  in  which  the  Court  has  refused  increases 
or  has  actually  decreased  the  minimum  rates,  and  the  employees  have 
listened  to  the  reasons  and  loyally  submitted.  In  the  case  of  the 
Shearers^  the  rates  for  shearing,  245.  per  100,  as  fixed  by  my 
predecessor,  were  not  increased  ;  and  the  strongest  union  in  Australia, 

1  Engine  Drivers,  s  Com.  Arb.  9,  i4>  16  (1911). 
2 Postal  Electricians,  7  Com.  Arb.  5,  12  (1913). 
3  Shearers,  5  Cora.  Arb.  48  (19"). 


m^ 


■I 


•m 


688       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  Australian  Workers'  Union,  acquiesced.  In  the  same  case  the 
Court  found  that  too  high  minimum  rates  had  previously  been  fixed 
for  wool  pressers  and  lowered  them,  stating  its  reasons.  There  was 
no  strike,  no  refusal  to  work,  no  expression,  that  I  know,  of  discon- 
tent. In  the  case  of  the  Builders'  Laborers  ^  the  Court  fixed  lower 
rates  for  Ballarat  and  Bendigo  than  for  Melbourne,  and  lower  rates 
for  Melbourne  than  for  Sydney,  all  because  of  differences  in  the  cost 
of  living.  The  Union  leaders  were  troubled  because  these  cities  had 
always  maintained  the  same  "union  rate,"  but  they  told  the  mem- 
bers of  the  Union  the  Court's  reasons,  and  there  was  peace.  Again, 
in  the  same  case  the  Court  fixed  for  Melbourne  a  lower  minimum  rate 
for  scaffolders  and  demolishers  than  had  been  previously  fixed  by 
the  wages  board, —  i  J.  3>^  d/.  per  hour  instead  of  1 5.  4J/2  d.  per  hour, — 
and  the  men  submitted.  The  truth  is,  I  think,  that  if  the  men  secure 
the  essentials  of  food,  shelter,  clothing,  etc.,  they  are  not  so  un- 
reasonable as  is  sometimes  supposed.  They  do  not  love  strikes 
for  the  sake  of  strikes,  and  the  great  majority  are  generally  quite 
willing  to  submit  to  reason  if  they  feel  that  they  are  reasonably 
treated. 

This  article  is  confined,  as  I  stated  at  the  beginning,  to  the  Fed- 
eral Court  of  Conciliation  and  to  my  own  actual  experience  in  con- 
nection therewith.  But  American  readers  should  know  that  in  each 
of  the  six  Australian  states  there  is  some  wages-board  system  under 
the  state  law  or  some  industrial  or  arbitration  court.  Victoria  was 
the  first  state  to  adopt  a  system  of  wages  boards,  about  1896,  and 
her  example  has  been  more  or  less  followed  in  Queensland,  South 
Australia,  and  Tasmania.  Western  Australia  has  an  arbitration 
court,  and  New  South  Wales  has  a  combination  of  the  two  systems— 
wages  boards  and  an  industrial  court.  There  is  no  organic  con- 
nection between  the  state  systems  and  the  federal  system.  The 
object  of  the  wages  boards  is  primarily  to  prevent  sweating  or  under- 
payment ;  the  object  of  the  Federal  Court  is  to  preserve  or  restore 
industrial  peace.  The  Federal  Court  deals  with  disputes,  as  such, 
and  prescribes  wages  etc.  merely  as  incidental  to  the  prevention  or 
settlement  of  disputes ;  the  wages  board  prescribes  minimum  wages 
and  has  no  direct  relation  to  disputes.  But,  as  is  obvious  from  the 
nature  of  the  case,  the  systems  often  overlap.  A  wages  board  consists, 
1  Builders'  Laborers,  7  Com.  Arb.  210  (1913). 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       689 

generally,  of  representatives  selected  by  employers  and  of  repre- 
sentatives selected  by  employees  in  equal  numbers,  with  a  neutral 
chairman.  There  is  not,  I  think,  any  fixed  principle  stated  by  the 
legislatures  for  the  guidance  of  the  boards  in  prescribing  the  mini- 
mum wage.  At  one  time  the  Victorian  legislature  enacted  that  the 
minimum  wage  should  not  exceed  the  wage  paid  by  "reputable  em- 
ployers," but  this  negative  provision  has  been  found  unsuitable  and 
repealed.  The  wages  boards  cannot  deal  with  all  industrial  condi- 
tions ;  the  Federal  Court  can  deal  with  any  industrial  condition  that 
comes  into  dispute.  The  wages  boards  do  not  publish  the  reasons  for 
their  determinations ;  the  Federal  Court  does.  As  a  result  I  find  that 
the  wages  boards  frequently  look  for  guidance  in  their  action  to  the 
reasoning  of  the  Federal  Court.  The  wages  boards,  within  the  limits 
of  area  assigned  to  them,  bind  all  employers  by  their  determinations ; 
the  Federal  Court  can  only  bind  those  who  are  concerned  in  the  dis- 
pute. The  wages  boards,  being  state  creations,  are  very  much  af- 
fected by  the  consideration  of  interstate  competition.^  In  dealing 
with  boot  factories  the  New  South  Wales  tribunal  would  have  fixed 
the  minimum  for  journeymen  at  gs.  per  day  but  for  the  fact  that 
the  rival  factories  of  Victoria  had  a  minimum  of  8^.  per  day.  The 
Federal  Court,  when  asked  to  intervene,  was  able,  as  an  Australian 
tribunal,  to  bind  the  employers  of  both  states  to  pay  the  gs.  per  day.^ 
Another  weakness  in  the  wages-board  system  is  that  employees  in  the 
presence  of  an  employer  or  a  possible  employer  have  not  the  inde- 
pendent position  which  would  enable  them  to  act  fearlessly.  This  is 
especially  true  where,  as  in  the  case  of  city  tramways,  there  is  only 
one  undertaking  where  a  tramway  man  can  get  employment.  In  the 
case  of  the  Brisbane  tramways  it  appeared  that  it  was  the  manager 
who,  as  a  member  of  the  wages  board,  made  all  the  proposals,  and 
that  every  one  of  his  proposals  was  carried  unanimously.^  Again, 
the  decision  of  the  wages  board  of  one  state  is  frequently  inconsistent 
with  the  decision  of  the  wages  board  of  an  adjoining  state.  There  is 
no  one  final  coordinating  authority,  as  in  the  case  of  the  Federal 
Court,  and  the  result  is  often  that  contrasts  appear  and  dissatis- 
faction arises  and  industrial  trouble.    For  instance,  a  large  mining 

1  Engine  Drivers,  5  Com.  Arb.  9,  17  (1911). 

2  Boot  Factories,  4  Com,  Arb.  i,  8  (1910). 
8 Tramways,  6  Com.  Arb.  130,  149  (191 2). 


^  II 


ill 


ti 


690       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

district,  of  essentially  the  same  physical  and  industrial  character, 
with  the  same  cost  of  living,  is  divided  by  the  artificial  boundary  line 
between  two  states.  The  wages  board  of  one  state  prescribed  one  set 
of  wages  and  conditions ;  the  wages  board  of  the  other  state  pre- 
scribed a  lower  set.  The  consequences  were  disastrous.^  A  New 
South  Wales  wages  board  gave,  in  the  case  of  builders'  laborers, ^ 
the  lowest  rate  to  scaffolders  and  the  highest  to  hodmen.  The  Vic- 
torian wages  board  gave  the  highest  rate  to  scaffolders.  The  New 
South  Wales  board  gave  a  low  rate  to  demolishers ;  the  Victorian 
board  gave  the  highest  rate.  The  Federal  Court,  when  it  came  to 
act,  prescribed  a  flat  minimum  rate  for  all  the  laborers,  and  the  em- 
ployees were  satisfied.  They  knew  that  a  man  of  exceptional  value 
as  a  scaffolder  or  in  any  other  capacity  would  still  be  able  to  demand 
and  obtain  a  rate  higher  than  the  minimum.  It  is  often  said  that 
the  minimum  rate  tends  to  become  the  maximum,  but  there  has  been 
no  proof  of  such  tendency  as  yet.  Moreover,  the  wages  boards  are 
often  not  suitably  grouped,  and  there  is  a  tendency  to  ignore  the 
interests  of  unrepresented  minorities,  of  employers  as  well  as  of 
employees.  For  example,  there  was  in  Victoria  a  "Hay,  chaff,  wood, 
and  coal  board,"  composed,  as  to  employers,  of  ordinary  wood,  coal, 
and  produce  retailers.  They  managed  to  get  a  determination  which 
kept  their  own  yardmen  at  low  wages  but  fixed  a  disproportionately 
large  minimum  for  yardmen  who  handled  coke,  because  the  gas  com- 
pany of  the  city  was  practically  the  only  vendor  of  coke  and  it  was 
not  represented  on  the  board.^  But  most  of  these  defects,  and  other 
defects  which  I  could  point  out,  are  not  of  the  essence  of  the  system 
and  will  probably  be  removed  or  obviated  in  the  light  of  experience. 
Employers  have  assured  me  that  they  welcome  the  fixing  of  minimum 
rates  by  the  boards  or  by  the  Court.  They  know  now  definitely  what 
they  must  pay,  and  so  long  as  they  pay  it  they  feel  no  more  the 
incessant  nagging  of  unions  or  employees  as  to  wages.  Nor  can  any 
impartial  person  deny  the  immense  relief  which  the  system  of  wages 
boards  has  afforded  to  thousands  of  the  most  helpless  families 
throughout  Australia.  Wages  boards  constitute  one  of  the  most  useful 
factors  of  those  which  tend,  in  the  words  of  James  Russell  Lowell,  to 

1  Engine  Drivers,  7  Com.  Arb.  132,  145  (1913). 
2 Builders'  Laborers,  7  Com.  Arb.  210  (1Q13). 
^Gas  Employees,  7  Com.  Arb.  58,  65  (1913). 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       691 

"lift  up  the  manhood  of  the  poor"  and  to  provide  proper  sustenance 
and  upbringing  for  the  children  of  the  nation. 

Perhaps  I  should  add  here  that  up  to  the  present  I  have  not  been 
able  to  trace  any  increase  of  price  of  commodities  to  the  fixing  of 
minimum  wages.  It  is  not  the  function  of  the  Court  to  ascertain  the 
truth  as  to  the  causes  of  increased  prices,  but  the  Court  watches 
for  any  side  lights  on  this  important  subject.  In  one  case,  I  believe, 
a  wages  board  raised  the  wages  of  milk  carters  by  is.  per  day,  and 
the  milk  vendors  at  once  raised  the  price  of  milk  by  id.  per  quart.  • 
For  100  quarts  per  day  this  would  mean  an  increase  of  receipts  to 
the  amount  of  Ss.  ^d.  per  day,  so  that  the  milk  vendors  had  raised 
the  price  of  milk  far  beyond  the  amount  necessary  to  recoup  them 
for  the  additional  wages. 

It  will  be  asked,  however,  What  is  the  net  result  of  the  Court  of 
Conciliation?  Have  strikes  ceased  in  Australia?  The  answer  must 
be  that  they  have  not.  There  have  been  numerous  strikes  in  Aus- 
tralia, as  elsewhere.  But  since  the  act  came  into  operation  there  has 
been  no  strike  extending  "beyond  the  limits  of  any  one  state."  Those 
who  are  old  enough  to  recall  the  terrible  shearers'  strike  and  seamen's 
strike  of  the  nineties,  with  their  attendant  losses  and  privations,  tur- 
bulence and  violence,  will  realize  how  much  ground  has  been  gained. 
The  strikes  which  still  occur  are  strikes  within  a  single  state,  and 
disputes  within  a  single  state  are  outside  the  jurisdiction  of  the  Court. 
It  can  be  safely  said  that  since  the  act  every  dispute  "extending 
beyond  the  limits  of  any  one  state"  comes  before  the  Court  or  the 
president,  either  on  the  application  of  parties  to  the  dispute  or  on  the 
initiative  of  the  officers  of  the  Court.^  Moreover,  with  the  exception 
of  one  doubtful  case,  in  which  I  was  not  personally  concerned  and 
do  not  know  the  full  particulars,  there  has  been  no  instance  of  an 
award's  being  flouted  by  the  employees,  no  instance  of  the  em- 
ployees' refusing  to  work  under  an  award.  There  have  been  cases  in 
which  parties  have  differed  in  the  interpretation  of  an  award  in  its 
application  to  exceptional  circumstances ;  there  have  been  instances 
of  inadvertent  disobedience ;  and  these  cases  have  sometimes  come  to 
the  courts  in  the  form  of  an  action  for  a  penalty.  But  these  were 
cases  in  which  the  award  was  treated  as  regulating  the  rights  of  the 
parties,  not  treated  as  a  thing  to  be  rejected. 

^Section  19. 


S!i|H| 


3HH 


H  ' 


it  i 


692       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  191 1  Parliament  intrusted  to  the  Court  another  formidable 
function— the  settling  of  wages,  hours,  and  conditions  of  labor  for 
federal  public  servants.    This  function  does  not  rest  on  the  constitu- 
tional power  to  make  laws  for  conciliation  and  arbitration  in  indus- 
trial disputes;^  it  rests  on  the  absolute  power  of  the  commonwealth 
in  relation  to  its  own  servants.    The  public  servants  are  allowed  to 
group  themselves  in  unions,  "organizations,"  as  they  think  fit  and  to 
approach  the  Court  with  a  plaint.    It  seems  at  first  sight  curious  that 
Parliament  should  intrust  any  tribunal  with  a  power  of  adjudicating 
on  such  subjects,  but  Parliament  has  been  careful  to  retain  the  final 
control  of  the  commonwealth  finances.    For  the  award  does  not  come 
into  operation  till  the  expiration  of  thirty  days  after  it  has  been  laid 
before  both  Houses,  and  Parliament  can,  if  it  sees  fit,  pass  a  reso- 
lution disapproving  of  the  award.    This  remarkable  jurisdiction  over 
public  servants  deserxes  a  study  all  to  itself,  and  I  can  only  say, 
though  there  have  been  several  important  awards  under  it,  no  award 
has  yet  met  with  the  disapprobation  of  Parliament,  and  no  resolution 
of  disapproval  has  even  been  tabled.  ^ 

In  conclusion  I  may  state  that  I  am  not  unaware  of  the  far-reaching 
schemes,  much  discussed  everywhere,  which  contemplate  conditions 
of  society  in  which  the  adjustment  of  labor  conditions  between  profit- 
makers  and  wage-earners  may  become  unnecessary.    Our  Australian 
Court  has  nothing  to  do  with  these  schemes.    It  has  to  shape  its  con- 
clusions on  the  solid  anvil  of  existing  industrial  facts,  in  the  fulfill- 
ment of  definite  official  responsibilities.    It  has  the  advantage,  as  well 
as  the  disadvantage,  of  being  limited  in  its  powers  and  its  objects.  Its 
objective  is  industrral  peace,  as  between  those  who  do  the  work  and 
those  who  direct  it.    It  has  no  duty,  it  has  no  right,  to  favor  or  to 
condemn  any  theories  of  social  reconstruction.    It  neither  hinders  nor 
helps  them.    But  it  is  obvious  that  even  if  all  industries  were  to  be 
carried  on  under  state  direction,  industrial  peace  would  be  as  vitally 
important  as  it  is  now,  and  that  it  could  not  be  secured  without 
recognition  of  the  principle  which  the  Court  has  adopted,  that  each 
worker  must  have,  at  the  least,  his  essential  human  needs  satisfied 
and  that  among  the  human  needs  there  must  be  included  the  needs 
of  the  family.    Sobriety,  health,  efficiency,  the  proper  rearing  of  the 
young,  morality,  humanity,  all  depend  greatly  on  family  life,  and 

1  Article  XXXV,  Section  51. 


A  NEW  PROVINCE  FOR  LAW  AND  ORDER       693 

family  life  cannot  be  maintained  without  suitable  economic  condi- 
tions. The  reasoning  which  has  lately  committed  to  the  Court  the 
function  of  settling  conditions  of  labor  for  public  servants  would  not 
be  less,  would  be  even  more  applicable,  if  the  state  had  more  servants 
than  it  has. 

Yet,  though  the  functions  of  the  Court  are  definite  and  limited, 
there  is  opened  up  for  idealists  a  very  wide  horizon,  with,  perhaps, 
something  of  the  glow  of  a  sunrise.  Men  accept  the  doom,  the 
blessing,  of  work ;  they  do  not  dispute  the  necessity  of  the  struggle 
with  nature  for  existence.  They  are  willing  enough  to  work,  but 
even  good  work  does  not  necessarily  insure  a  proper  human  sub- 
sistence, and  when  they  protest  against  this  condition  of  things  they 
are  told  that  their  aims  are  too  "materialistic."  Give  them  relief 
from  their  materialistic  anxiety,  give  them  reasonable  certainty  that 
their  essential  material  needs  will  be  met  by  honest  work,  and  you 
release  infinite  stores  of  human  energy  for  higher  efforts,  for  nobler 
ideals,  when 

"  Body  gets  its  sop,  and  holds  its  noise,  and  leaves  soul  free  a  little." 


Henry  Bournes  Higgins 


High  Court  of  Australia,  Melbourne 


m 


m^ 


XLI 

WAGE  THEORIES  IN  INDUSTRIAL  ARBITRATION^ 

LABOR  disputes  in  modern  industry  may  be  divided  generally 
into  those  which  involve  wages  and  those  which  involve  a  prin- 
ciple   A  principle  cannot  be  arbitrated.    If  it  is  arbitrated  it  ceases 
to  be  a  principle.    To  submit  it  is  to  surrender  it.    There  is  therefore 
a  distinct  category  of  industrial  disturbances  that  are  not  susceptible 
of  adjustment  by  any  method  which  denies  to  the  disputants  the 
direct  participation  in  the  settlement.    But  the  great  group  of  labor 
differences,  in  which  principle  is  not  involved,  may  be  adjusted, 
when  other  peaceful  means  fail,  through  intervention  of  a  third  party. 
The  principle  of  industrial  arbitration  is  an  assumption  that  all  dis- 
putes involving  wages  are  capable  of  adjustment  if  undertaken  in 
proper  time.   The  meager  experience  of  the  United  States  and  the 
broader  experience  of  other  countries  have  promised  to  find  in  the 
intervention  of  an  arbitrator  clothed  with  definite  powers  of  adjudica- 
tion a  vigorous  aid  to  the  maintenance  of  industrial  peace.    The 
distinctive  principle  of  arbitration,  which  in  the  practice  of  a  quarter 
of  a  century  ago  was  an  experimental  social  novelty,  has  received,  in 
some  form,  almost  world-wide  acceptance.   And  the  day  is  far  from 
prospering  the  culture  of  the  methods  of  peace. 

A  judgment  of  the  validity  of  the  wage  theories  underlying  the 
methods  of  industrial  arbitration  must  reflect  one's  conception  of 
the  place  of  the  individual  man  in  the  scheme  of  economics.  Is  the 
man  himself  the  end  of  economic  activity  or  a  means  to  the  end,  a 
factor  of  production?  The  first  concept  incorporates  the  idea  of 
social  welfare;  the  second  involves  a  doctrine  of  individual  self- 
interest  :  let  survive  him  who  can.  The  theoretical  defenses  of  in- 
dustrial arbitration,  as  I  propose  to  review  them,  have  been  usually 
in  terms  of  social  welfare  or  of  public  policy.  In  the  scientific  cnti- 
cisms  there  has  been  evident,  on  the  other  hand,  an  essentially 

iFrom  American  Economic  Review,  Vol.  VII  (1916),  pp.  324-342. 

694 


WAGE  THEORIES  IN  ARBITRATION 


695 


I 


individualistic,  competitive  conception — one  which  speaks  not  the 
language  of  general  immediate  social  interest  but  rather  that  of  the 
competing  entrepreneur  to  whom  wages  are  only  an  item  of  cost,  to 
whom  labor  appears  more  or  less  impersonal.  Of  this  general  dis- 
tinction, which  is  by  no  means  without  exception,  there  is  ample  evi- 
dence in  arbitration  precedents. 

The  two  ideals  of  distributive  justice,  one  social,  the  other  indi- 
vidual, have  not  always — or  even,  perhaps,  usually — coincided. 
The  aim  of  this  paper  is  to  suggest  a  judgment  of  the  validity  of 
wage  theories  in  arbitration  as  a  part  of  a  unified  theory  of  distribu- 
tion. To  this  end  it  is  well  to  examine  the  actual  precedents  as  they 
are  to  be  found  in  the  different  industrial  communities.  It  is  neces- 
sary, therefore,  for  science,  to  consider  wages  as  the  individual  enter- 
priser in  the  business  world  views  them.  But  whether  or  not  a 
strictly  economic  justification  for  wage  arbitration  can  be  found  is 
not  finally  indicative  of  its  proper  place  in  the  scheme  of  modern 
social  legislation.  Ulterior  social  considerations  may  and  often  do, 
in  a  dynamic  economy,  far  outweigh  those  that  are  purely  economic. 
When  the  fundamental  conditions  of  economic  life  are  in  rapid  and 
continuous  flux,  ideal  schemes  must  sometimes  be  held  in  abey- 
ance in  favor  of  immediate  remedial  expedients. 

To  the  term  "industrial  arbitration,"  unfortunately,  no  uniform 
meaning  is  attached.  Generically  it  denotes  the  intervention  of  a 
third  party  to  aid  in  the  settlement  of  disputes  between  employers 
and  employees.  In  this  sense  it  includes  mediation  of  whatever  kind, 
conciliation,  and  arbitration  in  the  narrower  and  now  the  most  gen- 
erally accepted  sense,  in  which  it  is  used  in  this  paper — namely,  the 
determination  of  an  industrial  dispute  by  a  third  party  independent 
of  direct  participation  by  the  immediate  disputants.  Mediation  and 
conciliation  are  merely  refined  methods  of  collective  bargaining. 

Moreover,  arbitration  may  be  voluntary  or  compulsory  Both  the 
reference  of  the  dispute  to  an  arbitrator  and  the  acquiescence  in  the 
terms  of  his  award  may  be  voluntary  ;  or  the  reference  may  be  volun- 
tary and  the  award  compulsory  ;  or  both  the  reference  and  the  award 
may  be  compulsory.  It  is  only  arbitration  providing  for  a  decree 
binding  upon  the  disputants  with  which  we  are  concerned.  Arbi- 
tration with  voluntary  award  is  a  whim.  An  award  unsatisfactory  to 
either  party  becomes  binding  upon  neither. 


'I 


[4  . 


696       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Sidney  and  Beatrice  Webb  say :  "  The  essential  feature  of  arbi- 
tration as  a  means  of  determining  the  conditions  of  employment  is 
that  the  decision  is  not  the  will  of  either  party,  nor  the  outcome  of 
negotiations  between  them,  but  the  fiat  of  an  umpire  or  arbitrator."^ 
To  some  the  statement  will  not  be  acceptable  that  conciliation  is 
simply  the  collective  bargain  in  a  more  polite  and  usually  a  more 
effective  form.  Many  competent  critics,  moreover,  see  in  the  proc- 
esses of  intermediation  the  promise  of  the  ultimate  future  mainte- 
nance of  industrial  peace.  To  some,  indeed,  the  implication  that 
agreement  between  the  owner  of  the  instruments  of  production  and 
the  organized  group  of  laborers  seeking  employment  will  continue  to 
be  by  "higgling"  or  by  the  "long  jaw"  is  even  offensive.  These 
latter  terms  have  not  had  a  connotation  uniformly  synonymous  with 
peace  in  industrial  relations.  Whatever  be  our  sentimental  attach- 
ment to  words,  it  is  nevertheless  obvious  that  the  fundamental 
distinction  between  the  judicial  types  of  industrial  settlements  is 
the  distinction  between  collective  bargaining  on  the  one  hand  and 
the  complete  elimination  of  collective  bargaining  on  the  other 
hand.  Conciliation  means  peaceful  mediation  with  the  power  of 
ultimate  settlement  residing  still  with  the  two  parties  to  the  issue. 
Arbitration  is  inconsistent  with  bargaining:  the  power  of  settle- 
ment resides  in  the  third  party ;  the  terms  must  be  obligatory 
upon  the  disputants.  Fundamentally,  the  distinction  is  not  be- 
tween conciliation  and  arbitration  but  between  bargaining  and 
adjudication. 

It  is  not  my  purpose  to  estimate  the  relative  efficacy  of  each  of  the 
judicial  methods  of  industrial  peace.  From  the  standpoint  of  social 
policy  conciliation  is  a  convenient  and  often  a  very  effective  means 
of  securing  a  meeting  between  a  supercilious,  often  relentlessly  inde- 
pendent, employer  and  the  willing  representatives  of  a  union  of 
employees,  or  between  the  representatives  of  a  clamorous  and  often 
vindictive  and  unreasonable  union  and  a  willing  employer.  But  all 
this  has  to  do  only  with  the  way  in  which  the  machinery  of  col- 
lective bargaining  is  set  in  motion.  There  is  implied  no  distinct 
wage  theory.  Not  so  in  the  case  of  arbitration.  There  the  custom- 
ary methods  of  wage  determination  are  abolished.    The  essential 

1  Industrial  Democracy,  Vol.  I,  p.  222. 


WAGE  THEORIES  IN  ARBITRATION 


697 


-C- 


characteristic  is  the  binding  award  rendered^  not  by  the  immediate 
parties  but  by  a  supposedly  impartial  third  party. 

The  word  "arbitration"  makes  an  initial  sentimental  appeal.  It 
speaks  the  language  of  distributive  justice;  it  calls  for  the  acme 
of  fairness  between  men.  But  practically  it  is  doubtful  whether  the 
arbitrator  of  an  industrial  dispute  can  convince  even  himself  of 
what  is  justice  in  any  particular  case.  Equity  is  unluckily  not  self- 
determining.  With  how  much  the  more  difficulty  will  he  satisfy  the 
rival  claimants!  In  the  historical  development  of  arbitration  prac- 
tice no  criterion  of  justice  has  been  generally  accepted  other  than 
the  vague  admission  that  the  award  must  not  be  "contrary  to  public 
welfare."-  The  perplexity  of  an  experienced,  fair-minded  arbitrator 
is  illustrated  in  Judge  Ellison's  determination  of  a  wage  dispute  in 
the  Yorkshire  Coalminers'  case  in  1879:^ 

It  is  for  [the  employers'  advocate]  to  put  the  men's  wages  as 
high  as  he  can.  It  is  for  [the  men's  advocate]  to  put  them  as  low 
as  he  can.  And  when  you  have  done  that  it  is  for  me  to  deal  with 
the  question  as  well  as  I  can.  But  on  what  principle  I  have  to  deal 
with  it  I  have  not  the  slightest  idea.  There  is  no  principle  of  law 
involved  in  it.  There  is  no  principle  of  political  economy  in  it. 
Both  masters  and  men  are  arguing  and  standing  upon  what  is  com- 
pletely within  their  rights.  The  master  is  not  bound  to  employ  labor 
except  at  a  price  which  he  thinks  will  pay  him.  The  man  is  not 
bound  to  work  for  wages  that  won't  subsist  him  and  his  family  suffi- 
ciently, and  so  forth.    So  that  you  are  both  within  your  rights.  .  .  . 

The  rapid  development  of  trade-unionism  during  the  period  from 
the  forties  to  the  seventies,  especially  in  Great  Britain,  and  the  for- 
mation of  employers'  associations  to  combat  the  rising  tide  early 
resulted  in  the  development  of  irregular  negotiations  administered 
largely  through  strikes.  In  many  industries  were  instituted  so-called 
arbitration  proceedings  such  as  that  cited  in  the  above  illustra- 
tion. But  for  many  years  much  of  the  arbitration  was  concerned 
with  voluntary  award,  essentially  resembling  conciliation.     Where 

1  Until  within  approximately  the  past  twenty-five  years  the  principle  of 
arbitration  compulsory  by  law  was  practically  unknown.  Its  most  elaborate 
trial  has  been  in  Australasia,  the  modern  laboratory  of  democratic  social 
experimentation. 

2 Webb,  Industrial  Democracy,  Vol.  I,  p.  229. 

3  Report  of  the  South  Yorkshire  Collieries  Arbitration,  p.  49. 


i^ 


1 
111 


ii 


u 

111 


698       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

arbitration  practice  prevailed  no  formula  or  consistent  theory  of 
wages  was  ever  recognized  to  guide  the  determination.  In  the  North- 
umberland Coalminers'  Arbitration  case,  for  example,  in  1875,  the 
operators  demanded  a  20  per  cent  reduction  in  wages.  Their  plea 
was  based  on  the  rapid  decline  in  coal  prices  since  1871,  evidenced 
by  "impartial"  data  drawn  from  the  operators'  accounts.  Despite 
the  fact  that  the  period  before  the  year  1871  had  been  one  of  rapidly 
rising  prices  and  that  wages  always  tend  to  lag  behind  prices  during 
such  a  period,  the  employers  claimed  that  their  profits  for  that 
year  (1871)  were  "fair"  and  "normal."  To  this  the  miners  ob- 
jected. They  asserted  that  the  policy  declared  by  the  operators 
would  force  the  employees  to  shoulder  all  the  consequences  of  an 
adverse  market.  They  denied  that  the  profits  in  187 1  were  normal 
and  challenged  the  operators'  main  contention  that  the  prices  of 
coal  must  fluctuate  "  in  exactly  the  same  ratio  as  wages  in  order  that 
the  profits  of  coal  owners  may  remain  the  same."^ 

The  arbitrator  in  his  decree  in  this  case  discarded  all  the  princi- 
ples advocated  before  him  and  made  the  award  on  a  wage-fund 
basis,  a  curious  promiscuity  of  principles  supposed  to  govern  wages. 
He  found  that  wages  had  increased  sipce  1871  ;  that  prices  had 
fallen.  A  reduction  of  wages  of  from  10  to  i2j<2  per  cent  was 
awarded,  but  not  because  the  current  of  prices  was  failing  to 
keep  abreast  of  the  increase  in  wages.  The  arbitrator  found  that 
the  number  of  men  in  the  industry  had  increased.  Where  there  were 
now  fourteen  men  there  had  been  formerly  but  ten.  From  the  "  total 
wages  fund"  he  found  therefore  that  each  man  could  expect  only 
one  fourteenth  instead  of  one  tenth.  The  award  concluded i^  "The 
restoration  of  economy  in  production  cannot  be  brought  about  by 
abating  the  rate  of  wages  only,  or  indeed  mainly,  but  must  be  accom- 
plished by  reducing  the  number  of  men." 

During  the  next  twenty  years  the  emphasis  shifted  to  the  principle 
of  the  sliding  scale  :  that  wages  should  be  determined  by  prices.  The 
settlement  of  the  proper  basis  and  the  administrative  details  of  such 
a  scheme  occasioned  in  many  industries  frequent  resort  to  arbitra- 
tion. The  inherent  tardiness  with  which  wages  followed  prices  was  a 
constant  source  of  aggravation  to  employees  during  periods  of  rising 

^Miner's  National  Record,  Vol.  VII,  pp.  108,  109;  reprint.  ^ 

^Ibid.  p.  109;  also  cf.  seq. 


WAGE  THEORIES  IN  ARBITRATION 


699 


prices  and  to  employers  during  periods  of  stagnation  or  of  depres- 
sion.^ The  great  stimulus  to  industrial  arbitration  and  the  extension 
of  the  method  of  compulsory  award  have  come,  however,  during  the 
last  generation,  from  the  advocacy  of  the  "living"  or  minimum  wage 
as  a  first  charge  upon  all  industry.  The  imionist  promulgators  of 
this  doctrine  in  England,  in  America,  and  in  the  British  possessions, 
prompted  by  ideals  of  general  social  welfare  tempered  somewhat 
with  class-consciousness,  failed  to  take  account  of  the  economic 
principle  that  in  the  long  run  general  wages  are  fixed  by  prices  and 
not  prices  by  wages.  Yet  the  minimum  wage,  in  so  far  as  any  such 
has  existed,  has  been  the  guiding  principle  in  much  of  the  recent 
wage  arbitration,  especially  in  Australasia. 

The  indiscriminate  way  in  which  wage  theories  have  been  taken 
up  and  discarded  is  attested  by  the  recent  American  arbitration, 
instituted  in  19 10  under  the  provisions  of  the  Erdman  Act,  between 
the  Order  of  Railway  Conductors  and  the  Brotherhood  of  Railroad 
Trainmen  as  appellants  and  the  Baltimore  and  Ohio  Railroad  as 
appellee.  This  action  resulted  in  the  well-known  Clark-Morrissey 
award,  the  terms  of  which  were  subsequently  extended  to  most  of  the 
railroads  in  the  Eastern  territory.  The  unions  in  this  case,  as  also 
in  the  similar  case  three  years  later  against  all  the  Eastern  railroads 
for  a  still  further  increase,  demanded  rates  of  pay  equal  to  those 
paid  in  the  Western  territory.    These  were  almost  uniformly  higher. 

(i)  In  the  name  of  standardization  (that  is,  to  abolish  the 
differential ) ; 

( 2 )  On  account  of  increased  cost  of  living ; 

(3)  On  account  of  increased  risk,  labor,  and  responsibility; 

(4)  On  account  of  the  increased  productivity  of  the  work  of  the 
train  crew ; 

(5)  On  the  ground  that  the  profits  made  by  the  railroads  in  recent 
years  have  increased  out  of  proportion  to  wages. ^ 

The  unions  urged  the  abolition  of  the  differential  between  the 
West  and  the  East  on  the  general  grounds  that  "railroading  per  se 
is  worth  just  as  much  in  one  part  of  the  country  as  in  another."^ 
A  minor  exception  was  recognized  in  the  case  of  the  Rocky  IVIountain 
territory. 

1  A.  E.  Suffem,  Conciliation  and  Arbitration  in  the  Coal  Industry  of  America, 
pp.  278,  279.  2Award,  p.  11.  ^Ibid.  p.  11. 


i 


4 


'^\ 


i 


Hii 


"' 


Mil! 


700       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  argument  of  the  unions  thus  embraced  a  miscellany  of  wage 
theories:  (i)  a  "cost  of  service"  theory,  involved  in  equal  sacrifice; 
(2)  a  "standard  of  living"  theory;  (3)  a  conglomeration  of  "risk/* 
"sacrifice,"  and  "value"  theory;  (4)  a  "productivity"  theory; 
and  (5)  an  "opportunity"  theory,  on  the  ground  that  the  fruits 
of  prosperity  should  be  distributed.  The  railroads  contented  them- 
selves with  contesting  the  claims  of  the  unions.  No  new  wage  theories 
were  added  by  them  to  the  list.  How  much  the  arbitrators  were  im- 
pressed by  the  wage  principles  addressed  to  them  is  shown  in  the 
statement  of  the  theory  underlying  the  award  that  "  the  employee  will 
be  paid  for  all  the  service  he  renders,  and  the  company  will  not  pay 
for  any  service  that  it  does  not  get."^  In  the  later  award  of  19 13, 
involving  the  Eastern  railroads,  the  arbitrators  stated  that  although 
they  did  not  found  their  action  entirely  upon  the  increased  cost  of 
living,  they  regarded  it  as  basic. ^ 

These  instances  are  only  illustrative  of  the  nonsuccess  of  arbi- 
tration precedents  in  establishing,  after  a  generation's  experience, 
uniform  theoretical  standards  for  the  adjudication  of  wage  contro- 
versies. Narrowly  economic  considerations  have  been  confused  in  the 
presence  of  broadly  social  considerations,  and  the  class-conscious 
representations  of  employees  and  of  employers  have  been  confused 
with  public  welfare. 

The  conditions  which  confront  the  industrial  arbitrator  are  com- 
plex and  often  embarrassing.  Finding  no  generalized  precedents  he 
is  compelled  to  adopt  such  unsatisfactory  rules  of  procedure  as  may 
seem  suitable  for  the  immediate  case.  He  is  furnished  with  con- 
flicting data.  Often  none  of  the  evidence  is  of  disinterested  origin. 
The  arbitrator  cannot  isolate  the  precise  share  of  the  value  of  the 
joint  product  that  is  imputable  to  labor,  nor  can  he  determine  the 
value  product  specifically  attributable  to  the  capital.  Of  serious  help 
he  gets  none  from  the  socialist  who  tells  him  that  labor  produces 
the  entire  product.  But  little  more  is  had  from  the  economist  who 
assures  him  that  the  laborer  produces  what  he  gets. 

Failing  to  secure  from  these  sources  any  workable  criteria,  he 
falls  back  upon  the  general  principles  of  distributive  justice.  But 
even  here  the  perplexities  are  scarcely  diminished.    The  arbitrator 

iThe  Clark-Morrissey  Award,  p.  210. 
2 Award,  p.  34. 


WAGE  THEORIES  IN  ARBITRATION 


701 


must  determine,  for  example,  whether  the  industry  can  afford  to  pay 
the  increased  wages  that  are  demanded.  Clashing  interests  do  not 
encourage  agreement  on  such  a  question.  What  are  "fair"  wages? 
"fair"  profits?  Is  the  rate  of  profits,  once  it  is  determined,  to  be 
applied  to  the  par  value  or  to  the  market  value  of  the  securities  or 
to  some  other  base?  Or  may  the  arbitrator  use  his  office  to  knock 
the  water  out  of  inflated  corporate  issues?  Shall  the  basis  of  rate 
determination  be  the  actual  investment  in  the  enterprise?  or  shall 
allowance  be  made  for  subsequent  changes,  for  example  in  the 
general  price  level  or  the  cost  of  reproduction  of  the  plant?  Is 
good  will  entitled  to  profit  ?  If  so,  in  what  proportion  ?  The  capi- 
talization of  an  elastic,  intangible  asset,  such  as  good  will,  can  easfly. 
be  construed  (as  it  unfortunately  too  often  is  construed)  into  a 
social  or  ethical  justification  of  the  income  itself  from  which  this 
capitalization  is  derived.  Against  such  a  form  of  question-begging 
the  arbitrator  has  often  found  difficulty  in  defending  himself. 

Even  after  these  issues  have  been  settled  and  the  conflicting  inter- 
ests appeased  the  arbitrator  finds  that  profits  vary  with  the  several 
firms.  The  award  involves,  therefore,  the  determination  of  the 
right  and  the  expediency  of  maintaining  in  the  field  the  least  effi- 
cient producers,  whom  the  compulsory  payment  of  higher  wages 
will  drive  out.  Moreover,  the  arbitrator  cannot  estimate  the  practi- 
cability of  shifting  the  higher  wages  to  consumers  in  the  form  of 
higher  prices.  As  an  impartial  outsider  he  does  not  know  the  busi- 
ness intimately.  Even  if  he  did  know  it  he  could  not  forecast  results 
with  assurance.  The  extent  to  which  an  increase  in  wages  can  be 
shifted  depends  upon  the  character  of  the  product  involved:  the 
availability  of  substitutes,  the  elasticity  of  the  demand  for  it, 
whether  the  initial  price  was  or  was  not  a  monopoly  price,  and 
kindred  considerations. 

It  is  small  wonder  that  the  Anthracite  Coal  Commission,  acting 
in  1902  at  the  instance  of  the  vigorous  and  withal  the  doubtfully 
legal  executive  action  of  President  Roosevelt,  declined  to  listen  to 
testimony  concerning  the  ability  of  the  several  companies  to  pay 
the  wages  demanded.  It  could  not  have  satisfied  itself,  nor  the 
employers,  nor  the  miners.  The  task  of  the  Commission  was  the  res- 
toration of  industrial  peace.  To  this  task  it  addressed  itself.  Upon 
the  companies  devolved  the  responsibility  of  accommodating  their 


'^1 


It 


mm 


it 


i!*iri**- 


■t 


702       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

business  to  the  terms  of  the  award.  The  settlement  was,  however 
an  avowed  makeshift.  The  agreement  was  extended  from  191 2  for 
an  additional  four  years,  expiring  March  31,  1916. 

This  brief  catalogue  of  some  of  the  important  issues  shows  how 
impracticable  must  be  the  judicial  determination  of  an  award  or  of 
a  series  of  awards  uniformly  consistent  with  the  principles  of  distrib- 
utive justice.    In  practice,  in  most  cases  and  in  most  countries   the 
umpire  has  abandoned  the  quest  for  a  theoretically  defensible  deci- 
sion.   He  often  claims  that  he  is  confronted  with  a  situation  and  not 
with  a  theory.    Demands  and  counterdemands  he  finds ;  assertions 
and  denials;    complaints  and  defenses.    These  are  tangible     It  is 
.  impossible  for  both  parties  to  be  right ;  nor  can  either  be  shown  to 
be  wrong.    In  actual  wage-arbitration  practice  in  Australia,  Europe 
and  America  the  most  widely  used  formula  has  been  "split  the  dif- 
ference."   That  this  is  so  is  the  familiar  impatient  criticism  thrust 
at  the  Erdman  Act  in  the  United  States.    This  eclectic  process  meets 
with  inevitable  disapprobation  from  one  side  or  from  both     It  has 
been  the  frequent  cause  of  public  ridicule  of  the  judicial  methods  of 
industrial  peace.    In  doing  substantial  justice  to  both  parties  the 
arbitrator  does  strict  justice  to  neither.^ 

As  an  instrument  for  the  distribution  of  the  social  income  arbitra- 
tion  has  few  consistent  theoretical  defenses.  Yet  practically  all  im- 
portant awards  have  involved  directly  a  wage  theory  of  some  sort 
which  can  be  isolated.  Mr.  Justice  Higgins,  the  president  of  the 
Australian  Arbitration  Court,  in  deciding  the  mine  workers'  dispute 
m  1908  elaborately  discussed  the  grounds  for  the  award  of  increased 
wages :  - 

Now,  the  first  condition  in  the  settlement  of  this  industrial  dispute 
as  o  wages  is  that,  at  the  very  least,  a  living  wage  should  be  secured 
to  he  employees.  I  cannot  conceive  of  any  such  industrial  dispute 
as  this  being  settled  effectively  which  fails  to  secure  to    he  laborer 

flTJ^  ^'    ^?  "^'^  "^^"P"^^'  ^^  "^"st  dispute,  until  he  gets 

vtwTrr*  •  •  •  N^''  do  I  see  any  reason  yet  for  modify hig  my 
view  of  a  living  wage  as  expressed  in  the  Harvester  case  (2  Comm 

dm^enZ^En^^^^^^^    ciissalisfacUon  with  this  unscientific  method  of  splitting 
ditterences,  England  has  attempted  to  require  in  a  large  category  of  disputes 

^Tl,''p      °'  V  '^'  """^'^  "^  ^^^'  ^'^^h  no  attempt  to  palfia^  both  sfde 
2The  Barrier  Branch  of  the  Mmers'  Association  Case,  1908  p  13 


WAGE  THEORIES  IN  ARBITRATION 


703 


Arb.  Rep.)  and  in  the  Marine  Cooks'  case  (2  Comm.  Arb.  Rep.).  In 
finding  the  living  wage  I  look,  therefore,  to  find  what  money  is  neces- 
sary to  satisfy  the  normal  needs  of  the  average  employee  regarded 
as  a  human  being  in  a  civilized  community. 

To  this  theory  of  the  "living  wage"  based  on  the  prevailing  stand- 
ard of  living  the  Australian  court  has  tenaciously  held.  Asserting 
that  the  requirement  is  primary  of  a  wage  sufficient  "  for  the 
healthy  subsistence  of  an  average  family,"  the  Court  in  the  Barrier 
Miners'  case  continued : 

First  of  all,  is  an  employer  who  is  poor  to  be  ordered  to  pay  as 
high  wages  as  the  employer  who  is  rich  ?  Now,  without  laying  down 
a  rule  absolute  and  unconditional  under  all  circumstances,  I  strongly 
hold  the  view  that,  unless  the  circumstances  are  very  exceptional,  the 
needy  employer  should,  under  an  award,  pay  at  the  same  rate  as  his 
richer  rival.  It  would  not  otherwise  be  possible  to  prevent  the 
sweating  of  employees,  the  growth  of  parasitic  enterprises,  the  spread 
of  industrial  unrest — unrest  which  it  is  the  function  of  this  Court  to 
allay.  If  a  man  cannot  maintain  his  enterprise  without  cutting  down 
the  wages  which  are  proper  to  be  paid  to  his  employees — at  all 
events,  the  wages  which  are  essential  to  their  living — it  would  be 
better  that  he  should  abandon  the  enterprise. 

Mr.  Justice  Gordon,  in  the  Brushmakers'  case  in  Adelaide,  said: 
*'If  any  particular  industry  cannot  keep  going  and  pay  its  employees 
at  least  75.  a  day  of  eight  hours,  it  must  shut  up."  In  the  Collie 
Miners'  case  Mr.  Justice  Burnside  refused  the  application  of  the  em- 
ployers that  the  minimum  wage  be  lowered :  "  If  the  industry  can- 
not pay  that  price  it  had  better  stop  and  let  some  other  industry 
absorb  the  workers,"^ 

Again  Mr.  Justice  Higgins  defined  the  positive  significance  of  the 
living-wage  theories  in  arbitration : 

It  is  necessary  to  keep  this  living  wage  as  a  thing  sacrosanct, 
beyond  the  reach  of  bargaining.  But  when  the  skilled  worker  has 
once  been  secured  a  living  wage,  he  has  attained  nearly  to  a  fair 
contractual  level  with  the  employer,  and,  with  caution,  bargaining 
may  be  allowed  to  operate.^ 

These  excerpts  represent  the  recent  attitude  of  the  important  Com- 
monwealth Arbitration  Court  of  Australia.    Its  jurisdiction  under  the 

16  W.  A.  Arb.  Rep.  84,  pp.  17,  18. 
^Jbid.  pp.  18,  19. 


m\ 


m 


I 


704       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

act  of  1904  extends  to  the  determination  of  wages,  but  only  in  those 
cases  in  which  interstate  interests  are  involved. 

The  act  providing  for  compulsory  arbitration  in  New  South  Wales 
was  passed  in  1901.  It  was  copied  from  the  New  Zealand  law,  and 
its  primary  purpose  was  to  stop  strikes.  In  a  letter  to  the  special 
labor  commissioner  of  the  state  of  California  Mr.  Justice  Hayden 
of  the  Arbitration  Court  seriously  questioned  the  wisdom  of  any 
compulsory  substitute  for  collective  bargaining: 

If  there  are  weak  classes  to  be  imposed  upon  ...  and  to  whom 
It  IS  m  the  highest  degree  just  that  a  fair  living  wage  should  be 
awarded,  there  are  also  strong  unions  able,  without  the  assistance  of 
any  tribunal,  to  win  for  themselves  wages  which  rise  as  far  above 
a  fair  living  wage  as  those  of  the  sweated  classes  fall  below  it.  To 
take  away  from  those  men  the  weapon  of  the  strike,  and  to  impose 
upon  them  the  compulsion  of  a  peaceful  award,  is  to  enter  at  once 
upon  difficulties  of  the  gravest  character.^ 

Whatever  may  have  been  the  result  in  leveling  down  high  wages, 
there  can  be  no  doubt  that  the  leveling  up  of  low  wages  in  New 
South  Wales  has  been  even  more  apparent.  In  1909,  one  year  after 
the  passage  of  the  Industrial  Disputes  Act,  which,  by  the  erection  of 
"industrial  boards"  to  determine  the  conditions  of  employment  in 
specified  industries,  reenforced  the  terms  of  the  Compulsory  Arbi- 
tration Act  of  1 90 1,  the  director  of  labor  reported: 

The  opinion  is  fast  gaining  ground  in  industrial  circles  that  greater 
benefits  are  likely  to  accrue  from  the  operation  of  the  act  than  could 
be  expected  from  the  methods  of  strikes.  Strikes  are  rarely  success- 
ful in  obtaining  all  that  is  demanded,  settlements  being  usually  in  the 
nature  of  a  compromise.  ...  Nor  is  this  all.  There  are  many  of 
the  smaller  and  less  compact  industries  in  which  the  operatives  could 
hope  for  nothing  whatever  from  a  strike.  ...  But  under  the  act 
they  are  in  as  good  a  position,  and  have  equal  opportunities  with  the 
largest  and  strongest  trades  unions.- 

Apparently  arbitration  has  here  had  the  effect  essentially  of  in- 
creasing the  bargaining  power  of  the  weaker  unions  in  the  presenta- 
tion of  their  claims  to  the  Court.    The  institution  in  1908  of  the 

1  Fourth  Annual  Report  of  Special  Commissioner  of  Labor  of  the  State  of 
California,  pp.  3,  4. 

2  See  Report  of  Director  of  Labor  to  the  Minister  of  Public  Works  of  New 
So'ith  Wales,  1909,  pp.  2  ff. 


ill 

^!l 


WAGE  THEORIES  IN  ARBITRATION 


705 


industrial  boards  gave  extended  jurisdiction  over  industrial  condi- 
tions even  before  actual  disputes  had  arisen. 

It  is  interesting  to  note  that  the  Department  of  Labor  of  New 
South  Wales  has  found  many  more  embarrassing  complexities  arising 
out  of  its  attempts  to  secure  standardization  of  wages  in  an  industry 
than  have  been  admitted  by  the  Commonwealth  Arbitration  Court  of 
Australia,  cited  above. ^  The  industrial  conditions  antecedent  to  the 
passage  of  the  Compulsory  Arbitration  Act  of  1908"  are  described 
in  the  report  for  1 908-1 909  of  the  Minister  of  Labor  of  New  Zea- 
land, in  paraphrase : 

Without  question  the  arbitration  act  had  excited  disfavor.  Even 
discounting  the  expressions  of  disapproval  of  chronic  industrial 
malcontents  the  act  was  disagreeable  to  the  great  solid  silent  body 
of  laborers.  The  executive  practice  of  granting  permits  to  work  below 
the  legal  minimum  wage  and  of  granting  exceptions  to  the  operation 
upon  employers  of  the  terms  of  the  award,  the  desirability  of  restor- 
ing function  to  conciliation  boards,  of  terminating  awards  where 
strikes  against  the  awards  had  taken  place,  of  authorizing  the  Court 
to  decline  to  make  an  award — these  and  other  influences  necessitated 
a  considerable  change  to  conform  the  law  to  modern  opinion.^ 

The  administrative  privilege  and  the  elasticity  allowed  under  the 
old  act  of  1 90 1  were  the  chief  causes  of  its  comparative  failure.  The 
extension  in  1908  of  the  principle  of  compulsion,*  both  as  to  reference 

lE.g.  Mr.  Justice  Higgins,  in  the  miners'  case  referred  to  above,  said:  "It 
is  not  difficult  to  see  the  danger  to  industrial  peace  involved  when  workmen 
performing  the  same  work,  with  the  same  skill,  in  the  same  city,  are  not  receiv- 
ing the  same  remuneration.  So  that  when  the  .  .  .  Company  ask  me  to  fix 
by  my  award  wages  lower  than  are  proper  for  the  industry  as  a  whole,  and 
adduces  as  its  reason  the  fact  that  its  mine  is  now  poor,  and  is  becoming 
poorer,  I  cannot  discern  either  justice  or  expediency  in  the  request"  (6  W.  A. 
Arb.  Rep.  84,  pp.  18,  19. 

2  Voluntary  arbitration  had  been  introduced  into  New  South  Wales  in  1896. 
Its  total  inadequacy  led  to  the  adoption  in  1901  of  the  compulsory  principle 
in  an  act  due  to  expire  by  limitation  on  June  30,  1908.  In  1908  was  passed  the 
Industrial  Disputes  Act.  Victoria  inaugurated  the  wage-board  system  in  1896, 
followed  by  South  Australia  in  1900,  Queensland  in  1908,  Tasmania  in  1910. 
Compulsory  arbitration  was  adopted  in  1902  by  Western  Australia  and  in  1904 
by  the  commonwealth  of  Australia. 

3Pp.  2,  3,  et  seq. 

■^It  is  to  be  noted  that  even  this  compulsory  arbitration  act  permits,  under 
very  strict  supervision,  the  payment  of  less  than  the  legal  minimum  to  old  men 
and  to  incompetents,  because  these  are  not  "worth"  the  minimum  to  the  em- 
ployer.   The  value  theory  of  wages  is  here  finally  lugged  in  at  the  back  door. 


II 


m 


!' 


706       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

and  to  award,  to  the  determination  of  the  conditions  of  employ- 
ment in  specified  industries  as  well  as  to  the  determination  of  active 
disputes  referred  to  the  Court  has  corrected  many  former  inadequacies. 
The  powers  of  the  Court  and  the  range  of  their  application  have  been 
much  strengthened  by  the  recent  Industrial  Arbitration  Act  of  19 12. 
The  grounds  for  compulsion  in  New  South  Wales  were  plainly  of  a 
broad  social  and  political  character.    Apparently  no  defense  argued 
for  the  passage  of  the  act  indicated  that  its  sponsors  were  concerned 
with  or  interested  in  its  compatibility  with  consistent  wage  principles. 
The  initial  guide  in  wage  arbitration  as  practiced  in  Australasia 
has  been  the  living  wage  to  the  industrially  fit.    This  wage  is  held 
to  be  a  prior  lien  on  the  income  of  industry.    The  courts  have  occa- 
sionally admitted  that  for  the  workers  it  constitutes  only  the  start- 
ing point.    The  men  demand  the  living  wage  plus  as  much  more  as 
they  can  secure.    This  is  a  relapse  to  a  value  basis  after  all.    The 
second  principle  is  practicability :  the  wages  bill  must  not  be  more 
than  the  industry  can  permanently  absorb.^     Third,   the  workers 
usually  demand  much  more  than  they  expect  to  get.    The  resulting 
practice  is  the  compromise,  to  which  attention  has  already  been 
directed.    Fourth,   the   minimum   wage    established    by    arbitration 
tends  to  become  the  standard  wage.^    The  economic  theory  of  com- 
pulsory arbitration  as  abstracted  from  the  New  Zealand  precedents 
has  been  ably  reviewed  by  Le  Rossignol.^    As  applied  to  the  dis- 
cussion of  wages,  the  principles  there  defined  may  be  framed  in  the 
following  paraphrase :  The  competitive  system  and  collective  bargain- 
ing have  resulted  in  low  wages,  sweating,  and  strikes.    Under  the 
sweating  system  the  worker  receives  less  than  a  decent  living  wage. 
By  the  method  of  the  strike  force  prevails  over  justice.    Strikes  and 
other  forms  of  industrial  warfare  discommode  the  public.    Such  in- 
dustrial methods  should  be  eliminated  by  an  impartial  judicial  deter- 
mination.   This  has  usually  taken  the  form  of  a  legal  minimum  wage. 

^The  practice  of  New  Zealand  has  not  evidenced  so  clearly  as  has  that  of 
the  Commonwealth  Court  of  Australia  the  principle  of  submerging  the  industry 
which  cannot  afford  to  pay  "fair"  wages.  The  latter  looks  to  the  eliminaUon 
of  this  form  of  industrial  parasitism. 

-M.  B.  Hammond,  "The  Australian  Experience  with  Wages  Boards,"  in  the 
Survey,  Feb.  6,  IQ15,  p.  12. 

3"  Compulsory  Arbitration  in  New  Zealand,"  in  Quarterly  Journal  of  Eco- 
nomics, Vol.  XXIV  (1910),  pp.  682,  683. 


WAGE  THEORIES  IN  ARBITRATION 


707 


But  if  the  standard  wage  is  attributed  to  the  proficient  worker, 
what  provision  is  to  be  made  for  the  superannuated  or,  more  espe- 
cially, for  the  relatively  unemployable?  Such  are  not  "worth"  so 
much  to  the  entrepreneur.  Can  the  principle  of  the  value  of  service 
to  the  employer  and  the  principle  of  a  fixed  legal  minimum  wage  be 
reconciled?  These  considerations^  lead  to  the  circular  reasoning 
with  which  industrial  arbitration  has  been  charged: 

1.  The  living  wage  is  relative  to  the  economic  position  of  the 
wage-earner. 

2.  The  economic  position  of  the  wage-earner  depends  upon  the 
wage  which  he  has  been  receiving. 

3.  The  wage  which  he  has  been  receiving  depends  upon  the  value 
product  attributed  to  the  worker  by  the  entrepreneur. 

The  living-wage  theory,  distinct  from  a  value-wage  theory,  thus 
defined  and  applied,  is  a  begging  of  the  question. 

In  venturing  an  estimate  of  the  merits  of  compulsory  arbitration 
it  must  be  noted  that  our  laboratory  has  been  confined,  in  the  main, 
to  Australasia.  Differences  in  industrial  development  between  coun- 
tries may  be  adequate  to  nullify  conclusions  drawn  from  so  limited 
territory.  The  comment  of  the  London  Morning  Post  of  September 
20,  191 1,  is  perhaps  not  wholly  inappropriate  or  unwarranted  i^ 

In  theory  the  idea  of  making  arbitration  compulsory  and  depriving 
employers  and  employees  of  the  right  either  to  lock  out  or  to  strike 
is  attractive  to  autocratic  minds.  .  .  .  The  enforcement  of  any  such 
law  upon  large  bodies  of  disgruntled  workmen  is  absolutely  imprac- 
ticable. To  draw  any  analogy  between  the  tiny  disturbances  of  a 
new  country  like  New  Zealand  and  the  titanic  upheavals  among  the 
crowded  millions  of  Britain's  industrial  workers  is  absurd. 

Admitting,  therefore,  that  its  experience  is  not  conclusive  upon 
the  other  countries,  the  result^  of  the  Australasian  experiment  with 
wage  arbitration  may  be  summed  up:   (i)  The  wages  system  has 

/^ Among  other  social  considerations  are:  The  living  wage  "fair"  for  a  single 
man  is  insufficient  for  the  married  man.  Is  the  state  therefore  to  regulate  mar- 
riage and  the  number  of  children?  Or  is  the  married  man  to  have  a  higher 
wage  than  the  single  man?  Then  which  one  will  "hunt"  for  a  job  when 
times  become  less  prosperous  ?  But  the  protection  of  which  one  is  the  more 
important  socially  ?    Cf.  ibid.  pp.  684  ff. 

•  ^Quoted  in  U.  S.  Bureau  of  Labor  Statistics,  Bulletin  No.  98  (1912),  pp.  177- 
178. 

^Cf.  Hammond,  op.  cit.  p.  18. 


!  I 


708       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

tended  to  rigidity.   The  direction  of  development  has  been  from 
contract  to  status,  or  the  exact  reverse  of  Sir  Henry  Maine's  juristic 
ideal  of  human  progress.    (2)   The  marginal,  the  most  inefficient, 
entrepreneurs   have   obstructed  wage   increases.   The   New    South 
Wales  Court,  unlike  the  Commonwealth  Court  of  Australia,  has 
usually   made   concessions   to   them.   The   unions,   however,   have 
urged    the   ostracism    of    such   inefficiency   as   unfit   for   survival. 
(3)  Wages  during  twelve  years  ending  in  1907  increased  24  per  cent ; 
food  prices  during  the  same  period  increased  22.5  per  cent.    In  only 
a  few  cases  has  an  industry  been  unable  to  absorb  its  wages  out- 
lay as  fixed  by  arbitration.^    (4)   Manufacturers  are  substantially 
agreed  that  compulsory  arbitration  has  increased  the  costs  of  pro- 
duction.  This  cannot,  however,  be  accepted  as  conclusive,  since  the 
entire  period  under  observation  has  been  one  of  generally  rising 
prices.    Dr.  Victor  S.  Clark,  formerly  of  the  United  States  Bureau 
of  Labor  and  a  careful  student  of  state  experiments  in  Australasia, 
ventured  the  conservative  opinion  in  this  matter  that  ''All  regu- 
lations restricting  the   freedom  of  employers  in  conducting  their 
business  probably  add  to  the  cost  of  production."  ^    A  well-known 
arbitrator,  since  the  passage  of  the  compulsory  law  in  1894,  stated 
that,  "with  possibly  one  exception,  industries  have  not  been  hampered 
by  the  provisions  of  the  act."^ 

It  is  a  significant  fact  that  wages  in  Australasia  during  much  of 
the  recent  period  of  rapidly  rising  prices  have  increased,  contrary  to 
the  general  rule,  as  rapidly  as,  and  during  some  years  more  rapidly 
than,  the  cost  of  living  has  increased.  Of  course  this  condition  in 
the  distribution  of  income  has  increased  the  workers'  buying  capacity 
in  local  markets,  and  so  contributed  to  general  high  prices.  These 
rising  prices  may  yet  prove  to  be  a  stumblingblock.  The  farmers  of 
New  Zealand,  for  example,  sell  their  goods  in  the  foreign  markets, 
competing  with  similar  goods  produced  in  other  countries  where  the 

1  This  is  the  official  claim  of  the  colonial  parliament  of  New  Zealand :  "  We 
can  only  add  our  personal  testimony  to  that  given  by  every  careful  investigator 
into  the  circumstances  of  New  Zealand,  that  there  is  so  far  no  evidence  of 
injury  to  its  industrial  prosperity"  (Industrial  Democracy,  p.  xlvii  (1902)). 

2 The  Labor  Movement  in  Australasia,  1906,  p.  233. 

3  Judge  A.  P.  Backhouse  in  Report  of  Royal  Commission  of  Inquiry  into  the 
Working  of  Compulsory  Conciliation  and  Arbitration  Laws,  Sydney,  N.S.W., 
1901,  p.  15. 


WAGE  THEORIES  IN  ARBITRATION 


709 


wages  bill  is  relatively  less  heavy.  What  will  be  the  effect  upon 
arbitration  awards  when  the  farmer  finds  the  prices  of  his  goods 
limited  by  foreign  competition  and  himself  nevertheless  compelled  to 
pay  increasing  prices  at  home  is  problematical.^ 

It  has  been  often  intimated,  as  has  been  pointed  out  above,  that 
ordinary  arbitration  precedents  have  been  drawn  from  extraordinary 
industrial  conditions,  such  as  have  existed  in  Australasia.  In  the 
main  this  is  true.  There  have  been  numerous  instances,  however, 
which  afford  clue  to  the  applicability  of  the  principles  of  arbitra- 
tion to  American  industrial  society.  A  legitimate  basis  of  compari- 
son may  be  found  in  the  "certain  well-defined  principles"  governing 
the  wages  determination  in  the  dispute  in  191 1  between  the  Western 
Coal  Operators'  Association  and  District  No.  18  of  the  United  Mine 
Workers  of  America : 

1.  A  living  wage  is  a  necessity. 

2.  In  mines  operating  under  the  same  association  and  within  the 
jurisdiction  of  the  same  labor  union,  uniformity  should  prevail  as 
far  as  possible. 

3.  In  the  same  mining  camp  equalization  of  wages  should  be 
sought.  After  passing  the  limit  of  the  living  wage  the  financial 
standing  of  the  company  should  be  considered.- 

One  of  the  serious  flaws  in  the  theory  of  wage  arbitration  is  here 
in  evidence.  The  fallacy  is  not  an  unusual  one.  It  is  proposed  that 
there  be  equalization  of  pay.  In  the  long  run  this  can  be  achieved 
only  by  means  of  an  equalization  of  effort.  Practice — and  there  are 
many  instances  of  this,  for  example,  in  recent  New  England  indus- 
trial history— has  indicated  that  such  a  policy  involves  a  process 
of  leveling  down  of  skill.  To  so  dangerous  a  program  even  the  ardent 
arbitration  enthusiast  must  hesitate  to  lend  his  assent. 

The  fundamental  general  principle  underlying  industrial  wage 
arbitration  has  been  that  of  the  living  wage.  Grounded  in  social 
policy,  the  living  wage,  usually  in  the  form  of  a  legal  minimum 
wage,  has  found  its  strongest  support   among   the  wage-workers. 

1  Complaints  of  this  character  have  been  made  in  Australia  and  more  recently 
in  New  Zealand.  Cf.  Report  of  Victoria  Commission  on  Operation  of  Factories 
and  Shops  Law  of  Victoria,  1903,  p.  xxvi. 

2 E.g.  Report  of  Arbitration  Board  in  Case  of  Grand  Trunk  Railway  v.  Its 
Telegraphers,  1908. 


h 


I: 


710       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Primarily  interested  in  social  results,  the  wage-earner  finds*  only 
minor  concern  in  the  immediate  or  direct  economic  effects,  except  in 
so  far  as  they  too  alter  the  broadly  social  effects.  The  employers,  the 
entrepreneurs,  charged  with  the  responsibility  of  the  right  propor- 
tioning of  factors,  of  the  proper  distribution  of  capital,  of  the  many 
technical  adjustments  incident  to  modern  industry,  generally  have  op- 
posed as  uneconomic  compulsory  wage  arbitration,  especially  when  the 
award  has  taken  the  form  of  a  fast  legal  minimum  wage.^  The  arbi- 
tration precedents  established  by  the  Commonwealth  Court  of  Aus- 
tralia have  been  generally  consistent  with  the  fundamental  underlying 
principle.  By  charging  the  individual  employer  with  the  responsi- 
bility of  so  setting  his  industrial  house  in  order  that  he  can  meet  the 
charge  imposed  by  the  general  wage  award,  it  has,  by  policy,  en- 
couraged the  survival  of  the  industrially  fit.  "Let  him  save  himself 
who  can ;  and  the  devil  take  the  hindmost."  Exceptions  to  the 
awards  have  been  more  customary  in  New  South  Wales  where  the 
"normal"  wage-worker  is  the  standard,  and  to  a  less  degree  in 
New  Zealand.  The  tendency  to  grant  such  relief  from  the  award 
has  been  in  direct  proportion  to  the  acceptance,  in  practice,  of  a 
value  theory  of  wages. 

In  the  individual  states  of  Australia,  as  distinguished  from  the 
commonwealth,  the  judges  have  persistently  disclaimed  any  profit- 
sharing  principle  for  their  wage  decisions.    General  consideration 


1  English  wage-earners  on  the  whole  favor  the  plan  of  arbitration.  The  op- 
position is  mainly  that  of  the  strong  unions,  which  expect  to  win  more  by 
direct  methods.    The  points  of  their  criticism  are  tersely  stated: 

"Too  many  conciliations  end  with  a  compromise  which  looks  like  six  of  one 
and  a  half  dozen  of  the  other;  .  .  .  Clean-cut,  straightforward,  cold-blooded 
business  recognition  of  trade  unions  is  worth  volumes  of  arbitration  schemes. 
.  .  .  We  like  peace,  we  want  peace,  we'll  have  peace  if  we  are  bound  to  fight 
for  it"  (U.  S.  Bureau  of  Labor  Statistics,  Bulletin  No.  98  (1Q12),  pp.  184-185). 

2  The  opposition  of  English  employers  to  the  scheme  of  voluntary  arbitra- 
tion as  provided  mainly  in  the  act  of  1896  has  been  crystallized  into  three  chief 
particulars:  First,  the  judges,  trained  in  the  courts  of  law  to  decide  cases  on 
their  merits  and  not  on  grounds  of  expediency,  are  apt  to  bring  to  arbitration 
the  ironclad  principles  of  the  formal  law.  Second,  the  arbitrator,  because  he 
does  not  have  the  responsibility  of  entrepreneurship,  can  afford  to  generously 
indulge  his  social  sympathies  at  the  expense  of  the  employer.  Third,  a  serious 
objection  is  the  tendency  to  "split  the  differences."  The  workers  put  their 
demands  unwarrantedly  high.  The  arbitrator  reduces  them  one  half  and  naively 
congratulates  himself  upon  his  ingenuity. 


WAGE  THEORIES  IN  ARBITRATION 


711 


has  been  given,  under  the  system  of  wage  boards  which  prevails  in 
many  of  the  states,  to  changes  in  cost  of  living.  Custom  has  featured 
somewhat  in  many  of  the  decisions.  The  immediate  guiding  principle, 
however,  as  distinguished  in  general  from  the  arbitration  precedents 
reviewed  in  this  paper,  where  the  living  wage  has  been  most  rigor- 
ously enforced  and  concessions  begrudged,  has  apparently  been  to 
"charge  what  the  traffic  will  bear."  This  return  to  value  terms  is 
expressed  in  the  following  principle  underlying  an  award  by  Judge 
Hayden  of  the  Court  of  New  South  Wales  (by  which  the  principle 
of  the  living  wage  has  been  the  less  rigidly  enforced),  that  the  men 
are  given  what  in  the  Court's  opinion  they  might  have  secured 
without  a  court,  considering  their  own  strength  and  the  resisting 
power  of  their  employers.^  Stated  otherwise,  the  Court's  gauge  has 
been  the  amount  which  the  Court  thinks  that  the  union  could  have 
wrenched  from  the  employer  had  it  resorted  to  the  direct  methods 
of  the  collective  bargain  or  of  the  strike.  But  the  general  complaint 
of  employers  in  Australasia  has  been  that  the  fixation  of  a  minimum 
wage  by  state  arbitration,  and  especially  by  the  wage  boards,  has 
compelled  the  entrepreneur  to  lower  the  wage  of  the  more  efficient 
to  compensate  for  the  higher  wages  of  the  less  efficient.  The  em- 
ployers have  often  naively  asserted  that  this  process  of  general  level- 
ing down  along  with  the  general  leveling  up  has  been  necessary,  so 
that  the  total  wage  budget  might  be  in  the  "proper"  or  "former" 
relation  to  profits.  The  minimum  wage  has  thus  tended  to  become 
in  fact  the  standard  wage.^ 

Finally,  it  is  to  be  noted  that  in  many  states  where  arbitration 
practice  has  been  most  highly  developed  the  state  has  challenged  the 
ethical  and  social  justification  of  existing  incomes.  It  has  been 
unwilling  to  accept  the  status  quo  as  a  necessarily  valid  starting 
point.    Unadorned  economic  theory  does  not  always  follow  through 


It 


ip.  Kennaday  in  Yale  Review,  Vol.  XIX  (1910),  p.  41. 

2  Professor  Hammond  has  pointed  out  the  important  difference  between  the 
wage  fixed  by  a  wage  board  and  the  wage  fixed  through  compulsory  arbitration. 
The  former,  made  compulsory,  as  a  minimum,  upon  the  employer  but  not 
upon  the  employee,  is  not  a  standard  and  still  less  a  minimum  wage.  The 
latter,  made  compulsory  alike  upon  employer  and  employee,  tends  to  become 
the  standard  wage.  Accordingly,  the  essential  difference  between  the  wage- 
board  plan  and  collective  bargaining  is  that  in  one  case  the  bargaining  is  com- 
pulsory, in  the  other  voluntary. 


(I 


lii 


712       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

the  labyrinth  of  social  amelioration.  Theories  of  distribution  give 
way  to  ulterior  considerations  of  immediate  social  policy.  The  state 
of  Victoria  is  definitely  committed,  for  example,  to  the  doctrine  that 
the  government  shall  enforce  the  right  of  the  workers  to  a  legal 
living  wage.  The  New  Zealand  law  and  the  precedents  built  upon  it 
commit  the  state  to  the  vastly  more  comprehensive  policy  of  the 
redistribution  of  the  income  from  private  industry.  The  same  is  true 
of  Western  Australia.  This  program  does  not  appear  today  as  the 
inevitable  outcome  of  a  policy  of  compulsory  wage  arbitration.  It 
is  fair  to  say,  however,  that  such  has  been  the  positive  tendency  in 
the  great  laboratory  of  modern  social  legislation,  where  the  judicial 
methods  have  become  almost  universalized  in  the  settlement  of  in- 
dustrial disputes.  And  it  seems  needless  to  point  out  that  the 
precedents  of  wage  arbitration  have  been  in  the  interests  of  the 
human  being,  the  individual  worker,  rather  than  in  the  interests  of 
industry  for  its  own  sake.  It  is  not  our  task  here  to  enter  upon  a 
consideration  of  the  validity  of  such  a  distinction.  The  principles 
underlying  wage  arbitration  have  become  not  an  economic  theory  of 
distribution  but  a  social  theory  of  redistribution. 

Among  modern  social  students  there  has  been  a  wide  difference 
of  opinion  as  to  the  theoretical  merits  of  arbitration  as  a  device 
for  wage  settlement.  The  persistent  division  of  sentiment  has  made 
the  subject  one  of  frequent  controversy. 

Mr.  S.  N.  D.  North,  in  1896,  gave  expression  to  what  is  perhaps 
the  fundamental  fallacy  of  the  theories  of  wages  in  industrial 
arbitration :  ^ 

The  question  whether  wages  ought  to  follow  prices,  or  prices  wages, 
is  one  which  boards  of  arbitration  cannot  determine.  .  .  .  We  may 
resolve  and  protest  and  insist,  but  it  still  remains  the  fact  that  the 
living  wage  is  only  possible  under  conditions  which  allow  the  living 
price.  This  is  the  A  B  C  of  industrial  economics.  .  .  .  That  is  the 
inexorable  law  which  trade-unionism  cannot  repeal.  If  the  wage 
could  make  the  price,  it  would  never  fail  to  do  so.  .  .  . 

To  the  many  questions  propounded  in  the  statement  of  the 
problem  of  the  wage  theories  in  arbitration  there  is  found  in  the 
precedents  no  adequate  answer.   As  a  method  of  industrial  peace, 

^  Industrial  Arbitration :  Its  Methods  and  its  Limitations,"  in  Quarterly 
Journal  of  Economics,  Vol.  X  (1896),  p.  415. 


WAGE  THEORIES  IN  ARBITRATION 


713 


arbitration  is  intermediate,  not  final ;  corrective,  not  remedial ;  op- 
portunist, not  ideal ;  an  expedient  for  which  the  defense  is  to  be 
found  in  present  social  policy.  From  the  narrowly  economic  point  of 
view,  as  contrasted — if  such  contrast  be  permissible — with  that 
of  general  social  welfare,  wage  doctrine  in  industrial  arbitration  is 
as  lacking  in  theoretical  justification  as  is  the  legal  minimum  wage, 
the  usual  product  of  arbitration  in  practice.  There  is  a  fundamental 
circle  in  the  reasoning;  throughout,  a  begging  of  the  question.  It 
takes  its  place  with  the  other  cost-of-production  theories  of  distribu- 
tion. In  judging,  however,  the  usefulness  of  compulsory  arbitration 
as  a  device  for  the  maintenance  of  industrial  peace  the  reminder  may 
not  be  inappropriate  that  the  "business  of  the  labor  arbitrator  is 
not  to  please  orthodox  professors  of  economy,  but  rather  to  find  a 
reasonable  modus  vivendi  for  two  disputants  who  are  unable  to 
find  it  for  themselves."^ 

Wilson  Compton 

Dartmouth  College 

iW.  P.  Reeves,  State  Experiments  in  Australia  and  New  Zealand,  Vol.  II, 
p.  169. 


H 


I 


MINIMUM  WAGES  FOR  WOMEN 


715 


I 


XLII 

MINIMUM  WAGES  FOR  WOMEN  ^ 

MUCH  as  has  been  said  of  late  about  minimum  wages  for  women, 
the  questions  raised  have  been  dealt  with  but  rarely  in  the  light 
of  economic  theory.  Economists  seem  to  have  been  wary  of  applying 
to  this  concrete  problem  the  general  reasoning  which  figures  so  much 
in  the  treatises.  A  reluctance  of  the  same  sort  is  observable  in  their 
treatment  of  other  current  questions.  What  is  the  influence  of 
immigration  on  the  general  rate  of  wages  ?  What  has  economics  to 
offer  on  the  controversy  between  closed  shop  and  open  shop  ?  What 
is  the  effect  of  a  protective  tariff  on  the  rates  of  wages  ?  The  answers 
to  such  questions  should  at  the  least  be  made  easier  by  economic 
theory ;  indeed,  to  aid  in  answering  them  would  seem  the  ultimate 
object  of  theory.  Yet  the  economists  have  contributed  much  more 
to  the  accumulation  of  facts,  the  ascertainment  of  details,  than  to 
the  elucidation  of  the  broad,  general  problems.  Perhaps  this  restraint 
has  been  due  to  a  consciousness  that  we  are  not  sure  of  our  ground. 
Economic  theory  is  in  a  process  of  readjustment;  our  current  for- 
mulas must  be  regarded  as  provisional;  some,  at  least,  among  the 
next  generation  are  likely  to  see  new  light  in  many  directions. 
The  egregious  errors  of  which  the  economists  of  the  first  half  of  the 
nineteenth  century  were  guilty  when  they  applied  offhand  the  theories 
of  their  day  impose  caution.  But  there  is  no  more  searching  way 
of  testing  the  generalizations  of  our  own  time  than  the  attempt  to 
apply  them,  perhaps  to  use  them  as  the  basis  of  prophecy.  And  if  in 
the  course  of  such  applications  our  theories  prove  bad  or  useless, 
the  sooner  we  find  it  out  the  better. 

In  the  following  pages  I  shall  endeavor  to  consider  the  legisla- 
tive measures  for  regulating  women's  wages  in  the  light  of  some 
generally  accepted  economic  principles.  At  the  very  outset  let  it 
be  noted  that  the  problem  is  in  essential  respects  different  for  women's 

^From  Quarterly  Journal  of  Economics,  V'ol.  XXX  (1916),  pp.  411-422. 

71.4 


wages  from  what  it  is  for  men's  wages.  About  minimum  wages  for 
men  nothing  will  here  be  said.  And  as  regards  women,  the  wages  of 
the  lowest  group  only  need  be  considered  at  this  stage  of  American 
discussion  and  legislation.  A  wider  application  of  the  minimum- 
wages  principle  is  of  course  possible — to  the  establishment  of  a 
series  of  minima,  for  men  and  for  women,  and  varying  for  the 
several  grades  of  labor.  But  it  is  to  a  single  minimum,  designed  to 
be  effective  for  the  lowest-paid  grade  of  women's  labor  only,  that 
legislation  is  directed  in  the  United  States ;  and  the  present  paper 
will  be  restricted  to  this  sort  of  regulation. 

The  broad  facts  are  sufficiently  known.  They  have  been  admi- 
rably set  forth  in  compact  form  by  Professor  C.  E.  Persons  in  an 
article  recently  published  in  these  columns.^  Let  me  summarily 
recapitulate  them.  Thp__mim|^fr  nf  women  and  girls  ernplpyed  in 
factories  and  shops  is  growing  fast.  It  is  growing  particularly  fast 
inlEe  occupations  classed~by  the  census  under  the  head  of  "trade 
and  transportation,"  among  which  shops  hold  the  first  place  for 
women.  Both  in  the  factories  and  shops  the  great  majority  of  the 
women  are  young.  Of  all  the  women  employed,  at  least  half  are 
between  the  ages  of  sixteen  and  twenty-five  ;  among  those  who  work 
in  factories  and  shops  the  proportion  of  young  women  is  even  greater. 
It  follows  that  they  are  a  shifting  class,  industrial  birds  of  passage. 
One  set  enters  the  shops  and  factories  and  remains  there  a  year  or 
two,  at  most  a  few  years.  Its  members  marry  and  are  succeeded  by  a 
new  set.  Though  there  are  some  older  women  in  the  group  here  under 
review, — the  lowest-paid  group, — it  is  made  up  chiefly  of  the  young. 
And  from  their  youth  and  the  temporary  nature  of  their  work  it 
follows  that  in  the  main  they  are  unskilled  or  inexperienced ;  or,  if 
skilled  and  experienced,  only  in  such  tasks  as  can  be  easily  learned. 

Again,  the  majority  of  these  girls  and  women  live  at  home.  They 
are  ordinarily  members  of  a  family  group  which  makes  common  cause 
in  domestic  life.  As  Professor  Persons  sums  up  the  outcome  of  his 
wide-ranging  research :  "  It  boots  little  to  multiply  illustrations.  .  .  . 
The  typical  female  workers  are  the  80  per  cent  living  at  home  and 
contributing  the  larger  part  of  their  earnings  to  the  family  treasury. 
Twenty  per  cent  of  the  girls  at  most  are  independent  workers." 

1"  Women's  Work  and  Wages  in  the  United  States,"  Quarterly  Journal  of 
Economics,  Vol.  XXIX  (1915),  p.  201. 


ll 


I 


• 


i 

I 


M 


11  |rp 


,Li 


w* 


716       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Finally,  current  wages  are  low  and  are  usually  less  than  is  reck- 
oned necessary  for  the  support  of  a  woman  living  alone.  As  a 
rough  generalization  it  may  be  said  that  the  wages  of  the  young 
women  who  constitute  the  bulk  of  those  employed  in  factories  and 
shops  range  about  $6  a  week.  Investigations  by  various  commissions 
lead  to  the  conclusion  that  the  minimum  on  which  a  woman  depend- 
ent on  herself  can  meet  "the  necessary  cost  of  proper  living"  (some 
such  phrase  appears  in  the  various  statutes)  is  at  the  least  $8  a  week. 
The  usual  wages  of  the  great  majority  of  women  employed  are  less 
than  this  minimum. 

Here  is  presented  the  first  general  question,  Are  not  the  industries 
which  employ  these  women  to  be  deemed  "parasitic"?  Is  it  not 
clear  that  the  women  who  receive  but  $6  a  week,  and  need  $8  for 
self-support,  must  have  the  difference  made  up  somehow?  The 
industries  which  employ  them  seem  not  to  pay  their  way,  and  the 
consumers  who  buy  the  products  do  not  recoup  the  full  expenses  of 
production.  Is  not  the  difference  necessarily  made  up  from  some 
other  source— by  parents,  by  charities,  perhaps  by  prostitution? 
This,  as  is  familiar  enough,. is  the  ground  most  frequently  urged  for 
fixing  minimum  wages  for  women.  Such  legislation,  it  is  maintained, 
recognizes  an  undeniable  fact;  it  puts  an  end  to  a  clear  case  of 
economic  parasitism. 

This  version  of  the  case  has  been  stated  so  frequently  and  by  such 
careful  thinkers  and  has  been  so  little  questioned— not  directly 
questioned  at  all,  so  far  as  I  know— that  one  must  hesitate  to  take 
issue  with  it.  And  yet  it  seems  more  than  questionable.  It  is  not 
clear  beyond  peradventure  that  the  case  is  one  of  parasitic  indus- 
tries ;  nor  must  the  minimum  needed  for  the  support  of  the  independ- 
ent women  necessarily  serve  as  the  basis  for  legislative  regulation. 

By  a  "parasitic"  industry  is  meant,  I  take  it,  one  which  necessarily 
entails  some  aid  and  payment  from  an  extraneous  source.  The  typi- 
cal cases  are  those  of  industries  employing  adults  who  receive  liter- 
ally less  than  the  bare  physical  minimum  of  subsistence.  Such  cases 
have  been  brought  to  our  attention  by  Mr.  Rowntree  and  others 
in  inquiries  on  the  wages  of  British  laborers  of  the  lowest  grade. 
Similar  cases  are  to  be  found  on  the  Continent,  especially  when  the 
handicraft  labor  of  former  days  is  in  process  of  being  displaced 
by  machine  industry,  the  handicraftsmen  clinging  desperately  and 


MINIMUM  WAGES  FOR  WOMEN 


717, 


hopelessly  to  the  ancient  ways.  Directly  or  indirectly  the  deficiency 
below  the  minimum  of  subsistence  has  to  be  made  up  from  some 
source  or  other :  through  public  or  private  charity,  through  higher 
taxes  or  larger  doles.  The  consumer  does  not  pay  enough  to  support 
the  poor  creatures,  and  the  general  public,  since  it  will  not  suffer 
them  to  starve,  must  in  some  way  or  other  make  up  the  difference. 

It  is  not  necessary  here  to  consider  the  question  in  its  larger  as- 
pects. The  phrase,  invented  by  the  Webbs,  is  in  danger  of  being 
overworked.  The  extent  of  strict  parasitism  is  probably  exaggerated. 
The  human  frame  can  endure  most  wretched  conditions;  the  race 
can  propagate  and  maintain  its  numbers  on  very  low  terms.  Wages 
that  we  figure  to  be  below  the  barest  minimum  prove  not  to  be  so. 
Reference  to  parasitic  trades  occasionally  gives  an  appearance  of 
calculating  economy  and  of  cool  rationality  to  proposals  which  really 
rest  on  something  better  and  are  to  be  justified  on  higher  grounds— 
sympathy  with  suffering  and  a  will  to  put  an  end  to  it.  But  this  is 
by  the  way.  Let  it  be  assumed  that  there  are  in  fact  parasitic  occu- 
pations in  the  sense  indicated.  Are  the  low  wages  of  factory  and 
shop  women  in  this  class? 

The  grounds  on  which  they  are  supposed  to  be  parasitic  have  been 
stated  often  enough.  Those  who  live  alone,  away  from  home  or 
without  any  home,  do  not  get  enough  for  support  if  they  receive 
only  such  wages  as  the  majority  get.  This  "  if "  is  to  be  noted ; 
for  it  is  quite  possible  that  the  independent  women,  a  minority  of 
the  whole,  are  usually  in  the  better-paid  positions  and  are  in  the 
main  identical  with  the  minority  who  receive  as  much  as  the  mini- 
mum for  independent  living.  But  of  this  more  in  another  con- 
nection. As  regards  the  majority,  who  live  at  home,  we  are  told 
that  their  case  is  in  no  essential  different  from  what  it  would  be  if 
they  lived  independently.  They  do  not  get  enough  to  support  them- 
selves. The  difference  between  what  they  earn  and  what  is  needed 
for  their  support  is  made  up  by  other  members  of  the  family, 
usually  by  their  parents.^ 

II  quote  the  following  from  the  Fourth  Report  of  the  New  York  Factory 
Investigating  Commission,  1915.  The  italics  are  mine.  Professor  H.  R.  Seager 
says:  "These  unfortunates  are  partly  supported  now  at  the  expense  of  others. 
Other  members  of  the  family  contribute  something,  charity  contributes  something, 
prostitution  contributes  something,  and  some  are  slowly  losing  vitality  and 
such  efficiency  as  they  have  left  because  they  are  constantly  overworked  and 


I 


f 

i 


718       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  figures  on  which  these  statements  rest  are  such  as  to  arouse 
suspicion  on  their  face.  The  minimum  of  subsistence  is  put  at 
some  such  figure  as  $8.  This,  it  is  reckoned,  the  young  woman 
must  have,  even  though  she  Hves  at  home.  Now,  it  seems  clear  that 
her  mother  needs  no  less ;  the  mother  must  have  as  much  as  the 
daughter  for  food,  clothing,  shelter,  incidentals.  And  the  father 
surely  needs  quite  as  much.  P'or  the  three,  then,  we  have  $24  a 
week  as  the  minimum  of  subsistence.  If  the  family  consists  of  more 
than  three,  a  still  larger  sum  is  the  minimum.  But  any  such  figure 
is  surely  untenable,  regarded  as  indicating  what  is  absolutely 
needed  for  "decent  subsistence."  An  income  of  $24  a  week  means, 
for  a  working-class  family,  not  only  ample  subsistence  but  envied 
comfort.  To  say  that  the  girl  who  is  a  member  of  such  a  family 
must  have  $8  a  week  for  bare  subsistence  is  tantamount  to  saying 
that  the  family  needs  at  least  S24  a  week ;  whereas  this  sum  is 
obviously  much  above  the  most  liberally  calculated  minimum.  An 
income  of  $15  a  week  has  been  set  down  in  recent  discussions  as  the 
sufficient  minimum  for  the  decent  support  of  a  family  consisting  of 
father,  mother,  and  three  children  under  fourteen.^    This  is  a  larger 

underpaid.  The  industries  that  employ  them  have  been  characterized  accurately 
as  parasitic  industries.  They  do  not  pay  their  way,  and  consumers  who  get 
goods  cheaper  in  consequence  are  living  at  the  expense  of  the  sweated  workers 
or  of  those  who  supplement  their  earnings  to  save  them  from  the  disastrous 
consequences  of  earning  less  than  suffices  for  decent  living." 

Again,  the  Massachusetts  Wage  Commission,  in  its  Report  on  Recommen- 
dations of  the  Candy  Makers'  Wage  Board,  uses  the  following  language  (the 
italics  again  are  mine):  "In  many  instances  their  actual  living  expenses  are 
partly  supplied  by  their  fathers  or  other  working  male  members  of  their 
families;  that  is,  the  self-supporting  industries  in  which  the  male  members  of 
the  family  are  at  work  are  paying  the  cost  of  living  not  only  for  their  own 
workers  but  are  supplying  the  deficits  in  the  wages  of  the  female  workers  in 
other  industries  who  happen  to  be  in  the  families  of  their  own  employees.  Cer- 
tain industries,  employing  large  numbers  of  women  living  at  home,  are  thus  in 
a  manner  dependent  on  other  industries  paying  higher  wages,  and  are  enabled 
to  keep  their  pay  rolls  small  because  the  actual  costs  of  conducting  business  are 
partially  paid  by  other  concerns." 

iThe  family  minimum  depends,  of  course,  on  the  make-up  of  the  family; 
there  is  artificiality  in  the  figures  given  for  a  "normal"  family's  minimum. 
Needs  vary  at  different  stages.  The  young  workman,  just  married,  gets  on 
comfortably  at  the  wages  current.  During  later  years,  when  children  are  half 
grown,  there  is  the  most  tr>'ing  stage.  Still  later,  when  the  children  begin  to 
earn  something,  their  earnings  serve  to  ease  the  situation.  A  girl  of  sixteen 
who  has  sisters  and  brothers  still  younger,  and  who  gets  $6  a  week,  contributes 


MINIMUM  WAGES  FOR  WOMEN 


719 


sum  than  is  ordinarily  got  by  the  unskilled  laborer  or  factory  worker. 
An  income  of  $600  a  year,  or  $12  a  week,  is  in  fact  as  much  as  such 
a  family  can  count  on.  But  let  the  higher  sum  be  taken  for  the 
purpose  of  the  present  simple  reasoning.  The  family  may  be  re- 
garded as  the  equivalent  of  at  least  three  adults— the  three  young 
children  being  counted  as  one  adult.  This  means  $5  per  adult. 
How  can  it  be  said,  then,  that  the  irreducible  minimum  for  any 
one  adult  is  as  much  as  $8  ? 

Consider  the  situation  from  another  point  of  view.  Suppose  that 
into  the  budget  of  a  family  whose  head  earns  $12  or  $15  a  week 
a  girl  brings  an  additional  $6.  In  a  working-class  family  the  differ- 
ence between  $12  and  $18  a  week  is  great;  it  is  the  difference  be- 
tween having  hardly  any  margin  at  all  and  something  like  ease.  It 
means  that  the  family  is  well  above  the  poverty  line.  Is  the  girl  who 
brings  in  $6  a  parasite  ?  Is  she  a  drag  or  a  prop  ?  Or  suppose  that 
the  young  woman  who  has  been  bringing  home  $6  a  week  drops 
from  the  family — dies  or  marries.  The  specific  expenses  entailed 
by  her  presence  cease  ;  her  specific  contribution  to  the  family  income 
also  ceases.  Is  the  family  better  off  or  worse  ?  Neither  parent  would 
hesitate  for  a  moment  from  answering  that  the  family  had  lost,  not 
gained.    Can  it  be  maintained  that  the  young  woman  is  a  parasite? 

The  view  that  any  wages  for  women  below  the  sum  usually  figured 
as  necessary  for  sole  support — $8  a  week  or  thereabouts — are 
"parasitic"  seems  to  me  misleading  as  regards  the  home  dwellers; 
that  is,  as  regards  the  overwhelming  majority,  the  dominant  constit- 
uency. It  is  possible  that  even  as  regards  the  minority  of  lone  and 
self-dependent  women  the  current  calculations  are  somewhat  more 
liberal  than  is  consistent  with  a  strict  minimum,  or  with  the  stand- 
ards and  ways  of  the  class  from  which  most  women  workers  are  re- 
cruited. Persons  habituated  to  higher  standards  find  it  difficult  to 
realize  how  bare  are  the  absolute  needs  of  those  at  the  bottom ;  and 
the  reckoning  of  a  minimum  of  decent  subsistence,  when  made  by  the 
more  prosperous,  may  easily  bring  the  total  above  the  sum  which  the 
poor  in  fact  find  the  minimum.  But  it  is  not  chiefly  on  this  score 
that  the  usual  figures  of  minimum  subsistence  are  to  be  corrected 

to  the  family  more  than  her  separate  "keep";  and  the  inducement  to  push 
into  employment  the  oldest  child  of  such  a  family— girl  or  boy— is  over- 
poweringly  strong. 


♦ 


II 


II 


II;. 


#l|i 


% 


720       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

or  reinterpreted;  this  correction— if  there  be  any— might  not  be 
serious.  The  main  cause  of  the  obvious  discrepancy  between  the 
minimum  supposed  to  be  applicable  to  all  (home  dwellers  included) 
and  the  smaller  sum  which  in  fact  these  home  dwellers  and  their 
families  find  a  source  of  positive  aid  is  to  be  found  in  another  direc- 
tion. The  calculation  ignores  the  economy  of  family  life.  Three  or 
five  members  of  a  family  can  subsist  on  an  income  which  would  not 
suffice  if  each  were  to  lodge  and  feed  separately.  The  family  is  the 
one  permanently  successful  case  of  expense-reducing  cooperation. 
The  girl  who  earns  $6  a  week  and  brings  home  that  sum  as  a  contri- 
bution to  the  family  earnings  adds  to  the  joint  resources  more  than 
she  adds  to  the  joint  expenses. 

It  is  best,  therefore,  to  set  aside  the  explanation  of  women's  wages 
f rom^^parasitism "  and  to  consider  the  situation  without  regard  to 
the  implications  of  this  phrase.  That  situation,  as  analyzed  in  the 
preceding  paragraphs,  suggests  a  different  and  more  tenable  line  of 
explanation  for  the  meager  wages  of  these  girls  and  women.  The 
circumstance  that  they  live  at  home  contributes  immensely  to  swell 
the  numbers  offering  themselves  in  the  labor  market  and  affects 
immensely  the  wages  which  they  get ;  and  it  also  affects  the  indus- 
trial quality  of  their  work.  Here  we  have  what  is,  from  the  point  of 
view  of  economic  theory,  the  crux  of  the  situation. 

There  is,  I  suppose,  no  proposition  so  universally  accepted  in 
economics  as  that  t];ie  remuneration  of  persons  in  any  labor  group 
depends  directly  on  the  numbers  in  that_group.  It  is  greater  if  the 
numbers  are  small,  less  if  they  are  large.  We  usually  try  to  state  the 
causal  connection  with  more  precision  by  saying  that  the  reward  in 
any  group  depends  on  marginal  desirability,  or  marginal  service- 
ability, or  marginal  productivity.  Often  we  use  the  general  phrase 
marginal  utility,  applying  the  same  terminology  as  in  the  theory 
of  value  at  large.  Since  labor  in  the  last  analysis  yields  simply 
"services"  or  "desirabilities"  or  "gratifications,"  just  as  material 
commodities  do,  the  same  principle  holds.  Often,  too,  stress  is  laid 
on  marginal  "productivity";  and  the  working  of  marginal  produc- 
tivity is  said  to  be  the  same  for  labor  of  any  particular  kind  as  it 
is  for  labor  at  large  or  for  the  general  rate  of  wages.  On  this  last- 
mentioned  point  I  am  disposed  to  make  reservations.  If  there  is 
a  determination  of  the  general  or  average  rate  of  wages  by  the 


MINIMUM  WAGES  FOR  WOMEN 


721 


marginal  productivity  of  labor  as  compared  with  that  of  capital,  it  is 
different  in  its  mode  of  operation  from  the  determination  of  the 
wages  of  a  given  class  of  labor  by  the  marginal  contribution  of  the 
class.  But  there  is  no  need,  for  the  purposes  of  the  present  discus- 
sion, to  consider  whether  this  method  of  reasoning  admits  of  sweep- 
ing application.  It  suffices  that  the  influence  of  an  addition  to  the 
supply  of  a  particular  commodity  or  a  particular  kind  of  labor  is 
agreed  to  be  the  same.  As  the  total  supply  increases,  the  successive 
increments  become  less  prized,  the  price  at  which  they  can  be  dis- 
posed of  falls,  and  thus  the  price  of  each  unit  of  the  supply  falls. 
The  business  world  calls  this  the  operation  of  "the  law  of  supply 
and  demand,"  or  the  determination  of  the  price  of  a  thing  by  what  it 
is  "worth  in  the  market."  And  it  is  a  part  of  the  same  doctrine,  of 
course,  that  the  marginal  price  is  that  at  which  the  entire  supply 
can  be  disposed  of.  Fix  a  higher  price  and  all  cannot  be  sold; 
some  units  of  supply  not  salable  at  the  higher  price  will  be  pressed 
on  the  market  and  will  cause  the  price  to  fall.  The  marginal  price 
alone^clears Jthe  market. 

Now  the  generaT  economic  presumption  is  that  when  a  given  price 
has  come  to  rule  in  a  market,  it  is  the  price  fixed  by  the  conditions 
of  that  market.  If  the  wages  of  a  particular  kind  of  labor  are  low, 
as  in  the  case  of  unskilled  men,  the  explanation  presumably  is  that 
there  are  many  of  them  and  the  marginal  desirability  of  their  labor 
is  small.  If  the  wages  of  unskilled  women  are  even  lower,  presumably 
it  is  because  the  marginal  desirability  of  their  labor  is  still  smaller. 
Economists  have  speculated  what  consequences  would  ensue  if  ordi- 
nary muscular  labor  were  scarce — if  only  a  select  few  could  handle 
the  pick  and  the  shovel  and  the  plow ;  how  much  their  labor  would 
be  desired  and  how  high  would  be  their  wages ! '  And  we  might  sim- 
ilarly make  the  hypothesis  that  but  few  women  were  in  the  labor 
market ;  then,  doubtless,  it  would  appear  that  there  were  some  tasks 
for  which  they  were  peculiarly  fitted  and  peculiarly  desirable,  and 
the  wages  of  the  limited  number  would  be  comparatively  high. 

The  number  of  women  who  offer  their  services  in  the  market  for 
the  particular  kind  of  labor  we  are  here  considering  is  large.  Be- 
tween the  time  when  schooling  ceases  and  the  time  when  marriage 
ordinarily  takes  place  there  is  a  gap  of  some  years.   It  may  be 

ij  refer  to  my  "Principles  of  Economics,"  Vol.  II,  chap,  xlix,  sect.  7,  p.  170. 


I ' 


i 


r 


i; 


i 


■  *. — ^-r. 


K   f 


722       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

disputable  whether  it  is  best  that  the  women  in  this  stage  should 
so  preponderantly  seek  work;  on  this  I  shall  say  more  presently. 
But  seek  it  they  do.  They  are  not  only  numerous,  they  are  also 
inexperienced;  they  offer  unskilled  labor;  the  marginal  service- 
ability of  their  labor  is  low,  and  therefore  their  wages  are  low. 
Prima  facie  the  explanation  of  their  low  wages  is  not  in  parasitism  or 
in  oppression,  but  in  a  simple  economic  situation.  Whether  it  is  un- 
just that  their  wages  should  be  low  raises  quite  a  different  question ; 
precisely  as  the  question  of  justice  in  regard  to  the  going  rate  for  un- 
skilled men's  labor  is  different  from  that  of  its  economic  explanation. 

It  seems  to  follow,  further,  that  to  set  a  rate  of  wages  higher 
than  the  going  market  rate  will  not  accomplish  the  object  in  view, 
or  at  least  the  main  object  desired ;  namely,  to  bring  up  to  the 
minimum  all  now  employed  at  the  lower  rate.  At  higher  wages  not 
so  many  can  find  employment.  And  while  the  number  demanded 
at  these  wages  will  be  less,  the  number  seeking  employment  is  likely 
to  be  greater.  Professor  Persons  has  remarked^  that  a  certain 
number  of  women  who  are  not  now  tempted  to  offer  their  services 
in  the  market  will  be  tempted  by  the  better  pay.  With  less  numbers 
demanded  and  larger  numbers  offering,  there  will  be  a  selection  of 
the  more  desirable,  a  rejection  of  the  less  desirable,  nonemployment 
for  a  certain  proportion.  How  large  the  proportion  of  unemployed 
will  be  must  depend  on  the  conformation  of  the  demand  schedule ; 
but  unemployed  there  will  be,  and  hence  failure  to  accomplish  the 
desired  object.  Such  seems  to  be  the  first  and  simplest  application 
of  economic  theory  to  the  case. 

There  are,  however,  qualifications  and  questionings.  As  in  every 
economic  problem,  and  above  all  in  labor  problems,  we  must  try  to 
make  our  general  reasoning  complete  as  well  as  severe.  In  two  direc- 
tions qualifications  or  modifications  need  to  be  considered.  First, 
this  labor  is  in  demand  not  by  itself,  but  jointly  with  other  labor ; 
and,  second,  it  is  peculiarly  weak  in  bargaining  power. 

As  is  the  case  with  almost  every  sort  of  labor,  the  conditions  are 
those  of  joint  demand.  Few  kinds  of  labor  are  demanded  by  them- 
selves ;  servants'  work  and  analogous  direct  service  are  the  most  con- 
spicuous examples.    Almost  every  kind  of  labor  given  to  fashioning 

iSee  the  article  already  referred  to  in  the  Quarterly  Journal  of  Economics, 
Vol  XXIX,  p.  228. 


MINIMUM  WAGES  FOR  WOMEN 


723 


or  vending  commodities  is  employed  in  connection  with  labor  of 
other  kinds.  In  the  factory  as  well  as  in  the  shop  the  poorly  paid 
women  are  employed  in  conjunction  with  men  of  all  grades  of 
skill  and  with  women  of  the  better-paid  grades.  Sometimes,  as  in 
candy  and  brush  factories,  the  women  of  the  lower  grades  form  a 
large  part  of  the  labor  force ;  more  often  they  form  a  small  part.  It 
follows  that  often,  indeed,  usually,  a  change  in  the  women's  wages 
makes  a  relatively  small  change  in  the  employer's  total  wages  bill 
and  makes  an  even  smaller  change  in  his  total  expenses.  The  per- 
centage of  increase  in  total  expenses  due  to  a  rise  in  women's  wages 
to  a  minimum  of  $8  or  $8.50  has  been  figured  out  for  sundry 
operations.  Often  it  is  a  small  fraction;  the  employer  can  easily 
afford  to  pay ;  how  can  it  be  maintained  that  any  economic  "laws" 
stand  in  the  way? 

I  am  skeptical,  none  the  less.  The  same  reasoning  would  apply 
to  any  one  of  the  numberless  factors  that  bear  on  the  total  expenses 
of  production.  No  change  in  any  one  item  is  likely  to  affect  at  once 
the  selling  price  of  a  product ;  almost  any  added  charge  comes  at 
the  start  out  of  the  employer's  profits  and  does  not  cause  him  to 
diminish  the  scale  of  his  operations,  still  less  suspend  them.  The 
employer  is  the  buffer ;  it  is  through  him  that  the  impact  of  the 
industrial  forces  is  transmitted  to  the  rest  of  the  economic  mecha- 
nism ;  the  first  effect  is  that  he  absorbs  the  shocks.  All  of  which  is 
familiar  enough.  Yet  we  may  be  confident  also — though  this  is 
less  often  insisted  on — that  any  change,  even  a  small  one,  if  it  be 
regularly  repeated,  has  its  influence  on  calculation  and  on  outcome 
and  comes  to  have  its  effect  on  prices  as  well  as  on  profits.  In  all 
discussion  of  this  kind  we  must  distinguish  between  long-run  and 
short-run  consequences ;  and  it  need  not  be  said  that  those  which 
ensue  in  the  long  run  are  the  more  important.^  Now  a  sustained 
prescribed- increase  in  the  wages  of  any  class  of  labor_aj:ts  Jjke^a 
permanent  excise  or  a  continued  riselnlHe  price  of  materials.  These 
changes  also  do  not  immediately  influence~pnces ;  they  also  may 
form  a  more  or  less  insignificant  fraction  in  the  total  expenses  of 
production ;  they  too  are  absorbed  for  a  while  by  one  or  another  of 
the  chain  of  middlemen.  Yet  no  one  would  pretend  that  all  of  them 
or  any  one  of  them  can  be  disregarded  because  the  employer  will 
simply  pocket  the  loss. 


"Iff' 


r 


724       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Still  another  consideration  leads  to  skepticism  as  regards  the 
negligibility  of  the  change.  There  is  a  large  possibility  of  substi- 
tuting  other  labor  for  that  of  the  women.  As  in  the  case  of  a  com- 
modity, the  resoTt  to  possible  substitutes  must  be  considered,  as  well 
as  the  demand  schedule  for  the  commodity  by  itself.  Higher  wages 
for  the  unskilled  women  are  likely  to  lead  to  more  or  less  replace- 
ment by  men,  skilled  or  unskilled.  Like  the  factor  considered  in  the 
preceding  paragraph,  this  one  exerts  its  full  influence  only  in  the 
course  of  time  ;  nor  is  it  possible  to  say  how  great  the  influence  will  be. 
It  would  seem  tolerably  certain  that  at  sundry  points  in  the  line  of 
"marginal"  employment  the  existing  equilibrium  will  be  upset  and 
rearrangements  made  in  the  combinations  of  different  sorts  of  labor. 

At  this  point  it  will  be  appropriate  to  consider  another  turn  which 
the  discussion  often  takes— one  which  also  is  supposed  to  point 
to  the  conclusion  that  the  advance  of  all  women's  wages  to  the 
proposed  minimum  will  be  inconsequential,  or  at  least  will  have  no 
consequences  outside  the  particular  industry  or  industries.  It  will 
simply  lead,  we  are  told,  to  greater  efficiency.  Sometimes  it  is  said 
that  the  employers  will  mend  their  ways  and  improve  their  processes ; 
sometimes  that  the  women  themselves  will  become  more  efficient. 
Are  there  grounds  of  general  reasoning  or  general  experience  for 
expecting  results  such  as  these? 

The  effect  of  legislative  pressure  (or  other  pressure)  in  inducing 
employers  to  adopt  more  efficient  processes  has  been  insisted  on 
in  various  directions.  A  conspicuous  recent  illustration  in  this 
country  is  the  contention  that  railways  can  meet  heavy  expenses 
or  make  up  for  low  rates  by  bettering  their  transportation  methods. 
Protected  manufacturers,  again,  are  often  told  that  they  can  meet 
more  severe  foreign  competition,  resulting  from  lower  tariff  duties, 
by  improving  their  processes  or  by  better  management.  And  so  as 
regards  minimum  wages,  whether  for  men  or  for  women.  Now  in  all 
these  matters  the  presumption  seems  to  be  against  the  fulfillment 
of  the  optimistic  expectations.  Improvements  in  the  arts  come 
from  the  most  various  sources  and  in  the  most  various  ways.  All 
sorts  of  possibilities  are  constantly  being  pressed  on  industrial  man- 
agers. The  inducement  to  secure  an  increase  of  profit  or  a  lessen- 
ing of  loss  is  always  keen— as  keen,  it  would  seem,  as  the  range 
of  intelligence  and  enterprise  in  the  managing  classes  makes  possible. 


MINIMUM  WAGES  FOR  WOMEN 


725 


It  is  not  to  be  denied  that  improvements  are  sometimes  intro- 
duced under  conditions  of  stress.  The  question  is  not  whether  this 
sometimes  happens,  but  whether  it  usually  and  normally  happens — 
whether  there  is  a  distinct  tendency  that  heavier  burdens  will  be 
more  easily  borne  because  of  the  concomitant  development  of 
greater  strength.  The  proposition  seems  to  me  highly  disputable. 
Perhaps  there  is  a  tendency  to  put  into  effect  in  hard  times  improve- 
ments already  known,  but  neglected  in  the  days  of  abundant  profits. 
On  the  other  hand  the  stimulus  to  invention  and  progress  is  the 
prospect  of  making  money  and  the  sight  of  others  making  money. 
This  is  the  case  above  all  for  those  improvements  in  plant  and 
machinery,  involving  heavy  investment,  which  have  been  the  most 
effective  among  the  causes  of  material  advancement.  The  problem 
is  one  of  wide  range ;  it  raises  far-reaching  questions  about  the  psy- 
chology of  money-making  and  of  invention ;  but  surely  it  is  the 
bait  of  profit  rather  than  the  threat  of  loss  which  has  been  the  great 
motive  factor  in  bringing  about  better  plant,  new  machinery,  more 
effective  organization,  increase  in  the  productivity  of  industry. 

A  somewhat  different  contention  on  this  score  is  that  the  employees 
themselves  will  become  more  efficient  because  of  higher  wages — 
stronger  physically,  more  alert,  perhaps  more  intelligent.  Will  this 
really  occur  ?  Needless  to  say,  we  must  bear  in  mind  here  also  the 
general  situation,  not  individual  cases.  If  a  single  factory  or  shop 
raises  wages  above  the  usual  rate,  it  is  likely  to  get  the  pick  of  the 
labor  supply  and  may  find  that  the  higher  wages  are  so  much  offset 
by  better  work  that  they  cause  no  loss,  indeed,  prove  to  be  a  source 
of  added  gains.  But  all  factories  and  shops  cannot  do  this  unless 
all  employees  become  more  efficient  by  virtue  of  getting  higher  pay. 
To  say  as  much  as  this  is  to  hold  the  steam-engine  theory  of  wages — 
to  maintain  that  just  as  more  power  is  got  by  putting  more  fuel 
under  the  boiler,  more  labor  power  is  got  by  putting  more  wages 
into  human  beings.  Among  theorists  the  late  Francis  A.  Walker  was 
the  first  conspicuous  proponent  of  the  doctrine,  which,  since  his  day, 
has  appeared  sporadically  in  recent  economic  discussion.  This  much 
of  truth  there  seems  to  be  in  it :  better  feeding  sometimes  causes  men 
and  women  to  be  physically  more  robust ;  better  training  causes  them 
to  be  more  intelligent — if  the  training  be  really  better ;  better  con- 
ditions may  cause  them  to  be  more  alert  and  ambitious.    These  good 


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It  ■• 


726       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

effects  may  come  from  higher  wages.  Just  how  they  come  and  how 
soon,  and  under  what  conditions,  and  with  what  certainty,  cannot  be 
said  with  any  assurance.  There  is  a  complex  of  causes,  a  series  of 
interactions,  a  difference  between  short-time  and  long-time  effects. 
Much  depends  on  the  elimination  of  that  portion  among  the  workers 
—perhaps  no  small  portion — who  by  nature  or  environment  are 
incapable  of  responding  to  uplifting  influences.  Much  depends  on 
the  intelligence  with  which  the  influences  are  guided— on  the  use 
of  food  and  drink  that  are  really  nutritious,  on  education  that  is 
really  helpful,  on  social  conditions  which  in  fact  arouse  alertness. 
As  a  general  proposition,  it  would  probably  be  nearest  the  truth 
to  say  that  higher  wages  are  ordinarily  not  the  cause  of  greater 
effectiveness  in  industry,  but  its  result;  while  yet  it  is  true  that 
under  favoring  conditions  higher  wages  may  also  be  one  among 
causes  of  slowly  developing  effectiveness.  The  influence  of  better 
pay  on  efficiency  is  neither  certain  nor  calculable;  still  less  is  it 
immediate. 

In  the  main  we  must  face  the  probability  that  higher  minimum 
wages  for  all  the  women  affected  will  lead  to  readjustments  extending 
beyond  the  industries  themselves.    They  are  not  likely  to  be  absorbed 
in  the  profits  of  employers  simply  because  they  constitute  only  one 
among  the  expenses  of  production.    Neither  are  they  likely  to  be 
offset  by  an  increase  in  efficiency,  certainly  not  by  a  corresponding 
and  calculable  increase.    They  seem  likely  to  lead  either  to  lessened 
profits  or  to  higher  prices  of  goods.    Either  consequence  leads,  again, 
to  some  curtailment  in  the  scale  of  operations  or  some  employment 
of  others  to  take  the  place  of  the  women.    Optimism  about  its  mak- 
ing no  difference  after  all  should  not  blind  us  to  these  probabilities. 
Turn  now  to  another  phase  of  the  discussion.    Are  not  the  low 
t  wages  of  the  women  explicable  simply  on  the  ground  that  they  are 
\weak  bargainers?    Must  not  theories  of  marginal  serviceability  or 
vendibility  be  applied  with  extreme  caution  to  such  cases  as  these? 
Is  there  not  mere  exercise  of  power  on  the  part  of  employers,  to 
be  counteracted  by  the  exercise  of  power  on  the  part  of  the  state? 
In  the  books  on  economics  we  are  constantly  talking  about  the  hand- 
icap placed  on  the  workman  by  his  lack  of  reserve  funds,  by  his 
ignorance,  by  the  perishability  of  labor,   by   the  stress   of   need. 
Hence  the  occasion  for  labor  organizations  and  labor  legislation. 


MINIMUM  WAGES  FOR  WOMEN 


727 


Are  not  these  considerations  applicable  with  special  force  to  the  work 
and  wages  of  women? 

Beyond  question  the  group  of  women  receiving  low  wages  are 
peculiarly  weak  in  bargaining  power.  They  are  young,  timid,  igno- 
rant ;  they  are  a  shifting  class ;  they  are  easily  browbeaten  and 
bullied.  Further,  they  are  hampered  as  regards  mobility.  Since  they 
usually  live  at  home,  they  cannot  seek  work  far  from  home  and  are 
under  pressure  to  accept  whatever  wages  are  offered  on  the  spot. 

General  reasoning  does  not  seem  to  be  of  much  promise  for  ques- 
tions of  this  sort.  Such  so-called  "exceptions"  or  "qualifications"  in 
the  working  of  economic  "laws"  would  appear  to  call  for  pains- 
taking inquiry  on  the  facts  in  each  particular  case,  and  for  that  sort 
of  inquiry  only.  And  yet  there  are  some  clues  of  a  general  char- 
acter. Low  wages  due  to  mere  weakness  in  bargaining  may  be  ex- 
pected to  be  accompanied  by  other  phenomena.  One  of  these — 
perhaps  the  most  significant — is  unusual  profit  by  the  employer. 
If  his  gains — due  allowance  being  made  for  risk,  order  of  ability 
required,  and  so  on — are  not  above  the  usual  or  competitive  level, 
he  cannot  be  said  to  take  advantage  of  the  employees'  inability  to 
bargain ;  he  succumbs  to  the  force  of  the  market  conditions.  Low 
wages  in  that  case  are  concomitant  with  low  prices  of  the  product ; 
they  are  not  a  cause  of  "sweater's"  profits.  And  low  prices  of  the 
product  are  then  the  result  of  market  conditions,  of  consumers'  de- 
mand. If  goods  can  be  competitively  sold  only  at  a  low  price,  the 
cause  is  that  there  are  many  of  them  as  compared  with  consumers' 
estimates  of  their  desirability ;  and  then  the  explanation  of  low 
wages  is  to  be  found  in  that  ultimate  source  already  indicated — 
the  marginal  serviceability  or  vendibility  of  the  particular  kind  of 
labor,  and  therefore  in  the  numbers  offering  it  in  the  market. 

This  sort  of  reasoning  could  be  used  with  little  hesitation  if  we 
had  to  deal  with  a  simple  case.  If  there  were  one  kind  of  labor 
turning  out  one  kind  of  product ;  if  we  found,  for  example,  that 
women  alone  were  employed  in  the  making  of  candy ;  and  if  we 
found,  further,  that  the  employers  took  no  more  than  the  competitive 
capitalists'  toll  on  the  goods  passing  through  their  hands, — then  we 
should  not  hesitate  to  say  that  if  low  wages  are  paid  to  the  women 
they  must  be  due  to  the  low  price  at  which  the  goods  are  sold, 
not  to  oppressive  exercise  of  bargaining  strength  by  the  employers. 


Jl  1 


ill? 


M 


728       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

The  actual  cases  are,  as  I  have  already  explained,  highly  complex. 
The  women  are  employed  in  conjunction  with  all  sorts  of  other 
workers,  and  their  wages  are  but  one  link  in  the  whole  chain  of 
expenses  of  production.  In  the  constant  irregularities  of  prices  and 
profits,  in  the  partition  of  successive  stages  of  industry  between  dif- 
ferent groups  of  producers,  there  is  room  for  bargaining  power  of 
which  the  consequences  are  not  easily  traced. 

There  is  not,  so  far  as  I  know,  any  body  of  evidence  to  show  that 
profits  in  all  or  most  of  the  industries  which  employ  a  considerable 
proportion  of  women  are  unusually  high.    It  is  often  enough  con- 
tended, indeed,  that  the  profits  are  such  that  the  proposed  increase 
in  wages  can  be  afforded  or  would  make  little  difference.    But  this  is 
not  the  same  as  to  say  that  the  existing  scale  leads  in  the  majority 
of  cases  to  profits  exceptionally  high.    It  is  probable  that  exceptional 
gains  from  low  wages  of  women  do  come  under  some  circumstances  ; 
for  instance,  when  an  industry  first  betakes  itself  to  a  district  where 
this  sort  of  unskilled  labor  is  abundant.    Thus  silk  mills,  in  which 
light  machinery  almost  automatic  in  operation  has  been  introduced 
of  late  years,  have  moved  to  the  anthracite  district  of  Pennsylvania 
and  have  employed  with  profit  the  grown  and  half-grown  children 
of  the  miners.    Candy-makers  have  similarly  planted  themselves  in 
the  heart  of  city  factory  districts.    Those  who  took  the  first  steps  in 
such  utilization  of  labor  supplies  very  likely  "exploited"  them  also- 
paid  low  wages  and  made  high  profits.    Like  other  changes  in  the 
localization  of  industry,  they  would  feel  the  leveling  influences  of 
competition  only  after  the  lapse  of  a  considerable  time.    Yet  transi- 
tional conditions  of  this  sort  are  not  the  typical  ones.    Women's 
low  wages  are  found  for  long  periods  in  all  sorts  of  places  and  in  all 
sorts  of  industries— in  cities  and  in  regions  where  they  have  been 
employed  for  generations,  in  old  industries  as  well  as  new.    There 
is  no  evidence  indicating  that  unusual  profits  have  been   reaped 
thereby  over  a  wide  range  of  industries.    So  far  as  this  sort  of  evi- 
dence goes  there  is  little  to  suggest  that  the  low  wages  have  been 
caused  merely  by  bullying. 

There  is  still  another  direction  in  which  we  may  look  for  evidence 
of  exploitation.  If  there  are  particularly  low  wages  in  one  estab- 
lishment among  others  of  the  same  kind,  or  in  a  few  among  a  con- 
siderable number,  there  is  ground  for  suspecting   that  a   "fair" 


MINIMUM  WAGES  FOR  WOMEN 


729 


market  rate  has  been  depressed  by  taking  advantage  of  weakness. 
Cases  of  this  sort  were  found  in  the  investigations  of  the  Massachu- 
setts Commission  on  Minimum  Wages  and  in  those  of  the  New  York 
Factory  Investigating  Commission.  Variations  from  region  to  region 
(not  from  establishment  to  establishment)  may  constitute  evidence 
of  the  same  sort ;  here,  however,  to  be  used  with  caution,  since  local 
variations  of  wages  are  common  and  are  usually  due  to  other 
causes  than  mere  exercise  of  bargaining  advantage.  Standardization 
and  a  common  rule  would  seem  to  be  peculiarly  called  for ;  and  it  is 
somewhat  surprising  that  comparatively  little  has  been  made  of 
circumstances  of  this  sort  toward  strengthening  the  arguments  for 
legally  enforced  minimum  wages. 

On  the  whole,  the  general  indications  do  not  lead  me  to  believe 
that  the  factor  here  under  consideration — weak  bargaining  power — 
is  the  chief  one  to  bring  about  the  low  wages  of  women.  No  doubt 
it  intensifies  the  situation.  It  stands  in  the  way  of  organization, 
of  mobility,  of  a  holding  to  the  market  rate,  of  response  by  actual 
wages  to  conditions  tending  to  raise  the  "current"  market  rate.  It 
causes  much  to  depend  on  the  temper  and  character  of  the  individual 
employer,  especially  as  regards  matters  accessory  to  the  main  wages 
bargain,  such  as  overtime  payments,  penalties  and  fines,  charges  for 
materials  and  for  breakage.  But  the  great  outstanding  fact  in  the 
situation — the  low  rate  of  wages  which  is  found  year  after  year 
over  a  wide  range  of  industries  in  all  parts  of  the  country — would 
seem  to  be  explicable  only  on  other  and  broader  grounds. 

Tjie  fundamental  cause,  we  are  forced  to^believe,  is  in  the  numbers 
of_those_seeking  employment.  And  these  numbers  are  pafrdf'the 
mass  of  unskilled  workers"^hose  pressure  for  employment  so  pro- 
foundly influences  our  industrial  and  social  conditions  in  every  direc- 
tion. The  low  wages  of  factory  women  are  indissolubly  associated 
with  the  problems  of  immigration.  The  constant  recruiting  of  the 
rank  and  file  of  unskilled  workers  by  the  inflowing  army  of  immi- 
grants keeps  wages  in  this  bottom  range  peculiarly  low  in  the  United 
States.  Though  wages  are  higher  than  for  the  same  class  in  the 
countries  whence  the  immigrants  come,  they  are  low  relatively  to 
the  general  American  scale  of  income  and  prosperity.  It  has  often 
been  remarked  that  the  gap  between  the  wages  of  skilled  and  un- 
skilled labor  is   in   the   United   States  greater   than   elsewhere — 


ill  m 

"IP  1 1 


i 


-2* 


730       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

greater  than  in  old  countries  like  England  and  Germany,  greater 
than  in  Australia  (a  new  country  whose  conditions  are  not  unlike 
our  own).  Relatively,  the  American  day  laborer  and  factory  hand 
is  not  so  well-paid  as  the  skilled  mechanic  or  the  farmer.  And  the 
explanation  is  that  the  continued  immigration  of  vast  numbers  has 
kept  the  bottom-wages  group  full  and  overfull.  I  will  not  undertake 
here  to  consider  whether  the  average  rate  for  all  American  laborers 
of  every  kind  (including  farmers)  has  been  lowered  or  raised  in 
consequence  of  immigration — whether  the  total  national  dividend 
per  worker  has  become  smaller  or  larger.  That  difficult  question, 
as  I  noted  at  the  outset,  has  been  argued  by  the  economists  as  spar- 
ingly as  other  general  questions  on  which  theory  might  be  expected 
to  facilitate  the  answer.  But  as  regards  the  wages  of  the  particular 
class  here  under  discussion — the  ordinary  unskilled  manual  work- 
men— the  influence  of  immigration  seems  beyond  dispute.  Every- 
one knows  that  throughout  the  manufacturing  and  urban  districts 
most  of  these  are  immigrants  and  the  rest  mainly  the  children  of 
immigrants,  and  that  the  immigrant  population  sets  the  wages  stand- 
ards for  the  entire  group.  It  is  their  large  numbers  and  the  con- 
stant recruiting  of  their  numbers  that  cause  wages  to  be  as  low 
as  they  are. 

And  it  is  their  daughters  who  constitute  the  great  army  of  women 
workers  competing  for  employment  in  factories  and  shops.  The 
wages  which  the  parents  get  attract  them  in  great  numbers  to  the 
United  States ;  the  wages  which  the  young  women  get  attract  them 
in  great  numbers  to  the  shops  and  factories.  The  multitude  which 
thus  bids  for  employment  in  the  entire  field  brings  about  current 
rates  of  remuneration  which  serve  on  the  whole  to  "clear  the  market." 
Rates  distinctly  higher  would  cause  more  applicants  to  offer  their 
services  and  would  cause  less  to  be  employed.  The  economic  theory 
of  the  case  is  simple :  the  only  effective  remedy  for  the  low  wages 
of  a  particular  class  of  workers  is  a  decline  in  the  numbers  offering 
themselves  for  the  particular  sort  of  employment. 

When  it  is  said  that  higher  rates  of  wages  would  cause  less  to 
be  employed, — that  the  demand  (that  is,  the  number  demanded) 
would  be  less  at  a  higher  rate  than  at  a  lower, — the  proposition  must 
be  taken  in  the  same  sense  and  with  the  same  qualifications  as  in 
the  case  of  a  commodity.    Much  depends  on  the  closeness  of  the 


MINIMUM  WAGES  FOR  WOMEN 


731 


connection  with  the  consumers.  A  rise  in  the  price  of  sugar,  for 
example,  has  its  effect  in  reducing  the  quantity  demanded  with  prompt- 
ness and  almost  with  calculable  extent.  Similarly,  a  rise  in  the  wages 
of  domestic  servants — an  increase,  say  by  legal  requirement,  of  25  per 
cent  over  the  rates  now  current — would  lessen  the  number  em- 
ployed with  promptness  and,  I  should  suppose,  to  a  considerable 
extent.  A  rise  in  the  price  of  wool,  on  the  other  hand,  would  be 
transmitted  to  consumers  through  the  cloth  manufacturers  and  the 
clothing-makers  and  the  wholesale  and  retail  dealers ;  the  effect 
would  be  slow  in  reaching  consumers  and  might  be  obscured  because 
of  the  simultaneous  influence  of  other  changes ;  it  would  probably 
be  complicated  by  some  resort  to  substitutes  for  wool.  In  the  same 
way,  a  rise  in  the  wages  of  women  in  paper-box  factories  would  also 
have  to  reach  consumers  through  the  effect  first  on  the  box  manu- 
facturers and  then  on  the  other  producers  and  merchants  who  are 
the  first  purchasers  of  the  boxes,  and  it  too  would  be  complicated  by 
the  possible  substitution  of  other  workers  for  women  and  by  that  of 
other  wrappings  in  place  of  boxes.  The  essential  question  is  about 
the  slow-working  influence  of  continuing  pressure.  As  regards  both 
the  wages  of  women  and  the  prices  of  boxes  we  must  consider  the 
consequences  not  of  a  sporadic  change  here  and  there  but  of  one 
affecting  all  enterprises  throughout  the  country.  What  would  happen 
if  legislation  should  try  to  apply  to  the  wages  of  all  women  a  mini- 
mum of,  say,  $8  a  week — the  sort  of  standard  rate  that  is  commonly 
proposed  ? 

The  answer  to  this  question  on  general  reasoning  would  seem 
clearly  to  be  that  not  all  the  women  would  continue  to  be  employed. 
The  numbers  offering  their  services  in  the  market  would  rise ;  it 
is  a  peculiarly  elastic  kind  of  labor  supply.  On  the  other  hand,  the 
number  demanded  in  industry  at  the  higher  rate  would  be  less.  The 
more  efficient  (or  more  tractable)  would  be  culled  out  and  first 
employed.  Others,  of  the  common  run,  would  be  retained  in  certain 
operations  for  which  they  were  serviceable  and  profitable  even  at  the 
higher  rate.  But  there  would  be  a  residuum — how  large  a  proportion 
it  is  impossible  to  say,  but  doubtless  considerable — not  employed 
at  all. 

But  here  still  another  question  presents  itself.  Perhaps  it  is 
desirable  that  a  certain  number — conceivably  a  large  number — 


hi» 


I 


■ 

I 


m 


732       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

should  be  thrust  out  of  employment.  Those  so  affected  would  be 
the  less  efficient  and  less  serviceable.  One  of  the  outstanding  aspects 
of  the  situation  is  IhcJarge  number  of  young  women  who  work 
fitfully  and  sporadically,  drifting  from  job  to  job.  They  have  no 
training,  no  vocational  skill,  no  ambition.  They  earn  something 
during  the  busy  season  and  do  little  or  nothing  at  the  slack  periods. 
Their  presence  and  their  availability  during  the  busy  times  tend  to 
acginttrate  the  irregularity  of  industry.  Hence  the  suggestion  that 
they""Be~3eIfberately  kept  out  of  the  working  ranks.  This  could  be 
accomplished  by  two  measures :  first,_raising  the  age  at  which  em- 
ployment shall  be  permitted,  say  from  sixteen  years  to  eighteen; 
andrsecond,  forbidding  absolutely  any^  ^jmployment  at  less  than  the 
"living"  wage  and  thus  automatically  shutting  out  those  not  em- 
ployaBle  at  that  rate.  To  such  a  policy  there  would  admittedly  have 
to  be  added  something  more — provision  for  the  further  and  better 
education  of  this  class,  not  only  for  higher  culture  but  for  industrial 
and  domestic  work. 

The  program  is  attractive;  it  cannot  but  command  sympathy. 
But  the  difficulties  in  the  way  must  not  be  underrated.  ^^^Q^ffective 
remodeling  of  the  educational  system  of  a  community  is  a  most 
difficuirthiiig  loTrTng  about — not  only  difficult  to  plan  and  pro- 
vide but  difficult  to  fit  into  the  wishes,  the  habits,  and,  not  least, 
the  needs  of  the  backward  constituency.  Such  a  readjustment  as  is 
contemplated  means  a  great  extension  of  secondary  education,  a 
complete  overhauling  of  its  content,  an  immense  increase  in  the 
number  of  pupils.  It  means  further  that  the  period  during  which  the 
young  women  must  be  support^edbylherr  parents  is  lengthened,  and 
lengthened,  too,  at  the  time  when  the  separable  expenses  of  main- 
taining them  have  reached  the  maximum.  The  economic  strain  must 
be  great  so  long  as  the  current  wages  of  men  (heads  of  families) 
remain  at  their  present  level.  It  would  be  necessary  to  reckon  with 
the  pressure  to  reach  the  stage  of  earning  something,  the  temptation 
to  evasion,  the  unpopularity  even  of  well-devised  uplift  education — 
not  to  mention  the  inadequacy  of  the  traditional  ways  of  secondary 
schools,  so  tenaciously  clung  to  by  the  teaching  profession  and  the 
school  authorities.  The  road  to  be  traveled  is  a  long  one,  and  for 
a  considerable  time  the  situation  must  be  dealt  with  as  it  is,  not  as 
we  wish  that  it  may  come  to  be  in  the  future. 


MINIMUM  WAGES  FOR  WOMEN 


733 


A  further  difficult  question  remains.  Assume  that  the  fitful, 
untramed,  mditferent  women  are  got  rid  of ;  that  all  who  offer  them- 
selves for  work  at  the  age  of,  say,  eighteen  years  have  had  an  indus- 
tnally  helpful  education ;  assume~t!i?rratf'the  workers  in  the  market 
are  in  this  sense  efficient, — will  all  of  them  then  be  able  to  get  dis- 
tinctly higher  wages  than  arc  now  current  ?  Perhaps ;  but  not  cer- 
tainly.  General  economic  reasoning  would  suggest  that  wages  depend 
not  on  personal  efficiency  but  on  the  numbers  possessing  the  effi- 
ciency ;  that  is,  on  marginal  effectiveness  or  serviceability.  Double 
the  numbers  of  a  group  of  workers  having  a  given  training,  and  their 
wages  will  go  down  even  though  their  training  has  been  excellent. 
The  net  usefulness  or  effectiveness  of  any  one  such  worker  becomes 
less.  And  even  if  you  maintain  the  numbers  of  a  given  group  at 
the  same  figure,  and  improve  the  training  and  personal  efficiency  of 
all,  their  wages  will  not  necessarily  rise.  To  make  effective  the  new 
potentialities  there  must  be  different  organization  and  different  equip- 
ment— a  response  in  the  managerial  situation.  The  whole  problem 
of  the  relation  between  vocational  training  and  individual  skill  on 
the  one  hand  and  industrial  output  on  the  other  is  a  tangled  and 
troublesome  one.  I  will  refer  here  only  to  one  common  source  of 
error  and  of  undue  optimism — a  confusion  between  the  effect  of 
trade  training  on  an  individual  and  its  effect  on  an  entire  group. 
Equip  a  single  boy  or  a  few  boys  for  a  well-paid  trade,  and  higher 
wages  will  be  got  by  these  few.  Equip  a  great  many  boys  for  such 
a  trade,  and  the  rate  of  wages  in  the  trade  may  go  down.  Compu- 
tations are  sometimes  made  of  the  profitableness  of  trade  training. 
It  is  figured  out  that  the  return  in  enhanced  wages,  compared  with 
the  expense  of  education,  amounts  to  a  magnificent  profit  on  the 
investment.  But  it  is  forgotten  that  if  a  multitude  get  the  training, 
the  wages  will  be  much  less  enhanced,  conceivably  not  enhanced  at 
all.  Equip  a  small  or  a  moderate  number  of  young  women  for  skilled, 
responsible,  steady  work,  and  they  will  get  higher  pay  than  before. 
Equip  all  the  young  women  of  the  same  class  and  the  same  age-groups 
for  such  work,  and  they  will  get  pay  not  so  much  higher,  conceivably 
not  higher  at  all.  The  same  proposition  holds  good  here  as  in  the 
cases  of  new  machinery,  great  inventions,  improved  organization, 
scientific  management.  When  confined  to  a  few,  and  during  the 
earlier  stages,  all   these  bring  profit  to  the  producers ;    when  of 


U 


734      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

universal  application  they  redound  to  the  benefit  of  the  community  at 
large,  and  the  producers  get  their  share  only  as  consumers  and  only 
to  the  same  extent  as  other  consumers. 

In  the  preceding  pages  attention  has  been  given  chiefly  to  the 
case  of  the  women  who  live  at  home  and  are  members  of  a  family 
group — the  great  majority.  What  of  the  minority — one  quarter 
or  one  fifth  of  the  total — who  do  not  have  the  advantage  of  family 
life  and  family  cooperation,  who  must  make  their  own  budget  ? 

Information  about  the  condition  of  these  self-dependent  women 
is  not  as  full  as  could  be  wished.  It  seems  probable,  however,  that 
not  many  of  them  are  in  the  lowest-paid  group.  Their  wages  appear 
to  be  usually  above  the  lowest  rates  and  above  the  average.  The 
women  who  must  make  their  way  alone  are  in  the  main  identical 
with  the  minority  who  get  the  better  rates  of  pay  and  earn  enough 
for  independent  living.^  This  result  is,  indeed,  to  be  expected.  The 
stress  of  need  leads  to  more  sustained  exertion,  more  professional 
exertion,  so  to  speak.  In  the  opinion  of  well-informed  and  sympa- 
thetic observers  there  is  no  good  ground  for  the  impression  that  it 
is  prostitution  which  serves  to  eke  out  the  receipts  of  the  single 
woman.  The  connection  of  prostitution  with  low  earnings  is  undeni- 
able §ind,  indeed,  obvious,  but  the  connection  runs  through  the  entire 
stratum  of  the  poor  and  is  not  especially  noticeable  in  the  case  of  the 
women  quite  dependent  on  their  own  exertions.  These  seem  usually 
to  earn  enough  to  get  along  and  are  no  more  likely  to  sell  themselves 
than  other  women  of  similar  antecedents  and  environment. 

But,  when  all  is  said,  the  lot  of  the  lone  woman  is  hard.  Among 
them  there  must  be  no  small  number  of  individuals  whose  case  is 
pitiable.  Their  situation,  like  that  of  the  women  who  have  to  support 
other  dependents,  brings  out  sharply  and  sadly  the  conflict  between 
the  two  opposing  principles  of  justice  in  distribution — the  principle 
of  need  and  that  of  efficiency.  Our  system  of  private  property  and 
competitive  wages  and  prices  bases  earnings  on  the  latter  principle : 
to  each  according  to  his  contribution.  The  insistent  altruistic  senti- 
ment, the  feeling  of  the  larger  self,  rebels  recurrently  against  the  rigor 
of  the  established  rule  and  would  mitigate  it  or  replace  it  by  the 

^This  conclusion — better  stated  to  be  an  impression  —  I  derive  from  con- 
versation with  social  workers,  members  of  commissions,  and  others  close  to  the 
situation.   Further  inquiry  on  the  point  is  much  to  be  desired. 


MINIMUM  WAGES  FOR  WOMEN 


735 


Ml 


Other :  to  each  according  to  his  needs.  So  it  is  as  regards  the  lone 
woman,  the  widow  who  has  children  to  support,  the  older  or  younger 
woman  who  is  the  sole  prop  of  a  forlorn  family.  The  need  is  great, 
even  though  efficiency  be  slight. 

Unfortunately,  a  prescription  of  minimum  wages  on  the  basis  of 
"proper"  independent  support — the  elimination  of  what  is  called 
parasitism— would  not  be  specially  effective  in  helping  these  women. 
They  might  or  might  not  be  among  those  retained  in  work,  might  or 
might  not  be  among  those  left  unemployed.  I  cannot  but  believe 
that  for  them  we  must  turn  to  other  measures,  both  palliative  and 
curative.  For  the  younger  women,  beyond  question,  we  need  helpful 
education  and  helpful  extension  of  the  period  of  training.  To  them, 
also,  charity  can  be  extended,  particularly  in  the  provision  of  decent 
lodging  at  prices  within  their  means.  Among  their  problems  that 
of  proper  housing  seems  to  be  quite  the  most  serious — morally,  as 
well  as  for  mere  shelter  and  space.  I  can  see  no  better  opportunity 
for  the  sympathetic  spirit  than  in  well-devised  accommodations  for 
this  special  class.  For  the  older  women,  widows'  pensions,  dependents' 
pensions,  infirmity  insurance,— the  various  forms  of  wide  provision 
by  public  authority  for  unavoidable  calamities, — loom  up  among 
the  desiderata  of  the  future.  The  feasibility  of  all  such  legislation 
depends  on  the  perfecting  of  political  and  administrative  machinery 
—a  most  urgent  task,  difficult  to  achieve,  inextricably  bound  up 
with  all  the  defects  of  democracy,  deserving  the  attention  and  the 
devotion  of  the  social  reformer. 

The  preceding  discussion  seems  to  justify  a  warning  that  there  is 
need  of  going  slow  in  the  regulation  of  women's  wages.  More  par- 
ticularly there  is  need  of  caution  in  applying  as  the  standard  for 
determining  all  wages  the  amount  needed  by  the  independent  women. 
The  "parasitic"  interpretation  of  the  situation  is  unwarranted.  The 
women  workers  are  not  a  drain  on  their  families,  or  on  other  indus- 
tries, or  on  the  community  at  large.  It  is  precisely  at  this  point 
that  the  campaign  now  being  carried  on  in  the  United  States  is 
vulnerable.  I  cannot  but  believe  that  an  attempt  to  apply  on  a 
sweeping  scale  the  principle  of  abolishing  "parasitism"  must  before 
long  break  down  in  practice.  The  real  question  is  not  whether  the 
young  women  fail  to  contribute  anything  to  their  families  or  to  the 
national  dividend,— they  do  contribute,— but  how  their  contribution 


i^ 


} 


736       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

can  be  made  larger  and  how  they  can  secure  a  larger  share  of 
the  national  dividend.  The  plain  facts  of  the  situation  must  be 
faced.  The  immense  majority  of  women  who  work  in  factories  and 
like  employments  do  not  need  as  a  minimum  any  such  wages  as  the 
commissions  now  at  work  are  asked  to  prescribe.  To  prohibit  their 
employment  except  on  this  basis — to  require  that  every  woman  at 
work  should  receive  some  such  sum  as  $8  a  week — would  not  bring 
about  the  employment  of  all  at  any  such  rate,  but  a  reduction  of  the 
number  employed  and  a  failure  to  attain  the  desired  end. 

This  by  no  means  leads  to  a  rejection  of  public  regulation  or  a 
denial  of  the  usefulness  and  desirability  of  wage  boards.  The  con- 
siderations adduced  in  preceding  pages  do  not  point  to  the  good  old 
policy  of  laissez  jaire.  It  may  well  be  that  there  is  need  of  regulating 
and  protecting  the  wages  of  women  and  of  prescribing  minimum  rates 
for  those  in  the  lowest  group.  The  conditions  of  their  employment 
are  such  as  to  lead  easily  to  "unfair"  wages — wages  kept  low  by 
taking  advantage  of  timidity,  ignorance,  lack  of  mobility,  lack  of 
bargaining  power.  The  lack  of  standardization  and  the  divergent 
rates  of  pay  under  similar  conditions  point  strongly  to  haphazard 
influences  of  this  sort.  Collective  bargaining  through  organization, 
difficult  enough  for  the  more  independent  and  better-trained  women, 
is  almost  out  of  the  question  for  the  lowest  ^roup.  A  public  commis- 
sion can  act  as  a  regulating  and  standardization  body,  striving  to 
eliminate  the  wage-depressed  employee  and  bringing  about  the  best 
terms  which  the  social  and  industrial  situation  as  a  whole  permits. 
And  such  a  body,  by  the  very  fact  of  its  existence,  must  be  expected 
to  exert  its  influence  for  the  mitigation  of  the  lot  of  the  poor  and 
weak,  and  therefore,  within  the  debatable  zone,  for  an  upward  trend 
of  wages.    Its  aim  must  be  to  press  up,  not  to  keep  down. 

It  may  be  asked  what  standard  a  wage  board  can  set  up  if  no 
absolute  minimum  is  to  be  applied.  The  single-woman  minimum  is 
calculable  and  ascertainable — something  on  which  figures  can  be 
got  and  a  precise  basis  for  action  secured.  How  fix  a  minimum  for 
the  girls  and  women  whose  expenses  are  to  be  allocated  in  a  family 
budget?  The  task  would  seem  to  be  as  hopeless  as  that  of  ascer- 
taining the  separate  supply  price  of  one  among  a  group  of  commodi- 
ties produced  at  joint  cost.  The  answer  must  be  that  the  problem 
is  difficult  and  that  no  simple  rule  is  at  hand  for  solving  it.   A 


MINIMUM  WAGES  FOR  WOMEN 


737 


wage  commission  or  board  not  committed  to  the  standard  of  sep- 
arate support  would  have  to  proceed  by  rule  of  thumb — by  stand- 
ardizing rates  of  pay  not  very  greatly  removed  from  those  found 
in  representative  establishments  of  better  grade  and  watching  how 
the  prescribed  rates  operate  from  time  to  time.  It  would  have  to 
proceed  cautiously  and  slowly,  even  though  sympathetically.  Virtu- 
ally this  is  what  every  wage  board  does,  whatever  the  supposed 
basis  of  precise  action.  We  make  pretenses  when  we  say  or  imply 
that  there  are  rigid  principles  on  which  to  rest  such  determinations. 
Even  for  men  minimum  wages  or  minimum  expenses  of  living  are 
in  reality  shifting  and  relative  things.  The  supposed  fixed  amounts 
vary  from  place  to  place  and  from  generation  to  generation.  It  is 
all  in  the  domain  of  opportunism. 

F.  W.  Taussig 

Harvard  University 


il  A 


nil 


XLIII 

AMERICAN  MINIMUM-WAGE  LAWS  AT  WORK^ 

TO  THE  uninitiated  student  of  American  standards  of  living 
minimum-wage  legislation  in  this  country  presents  a  strange 
anomaly.  On  the  one  hand  is  the  continually  announced  and  appar- 
ently accepted  dictum  that  for  the  woman  worker  a  fair  wage  must 
be  a  living  wage ;  that  anything  less  than  that  constitutes  exploita- 
tion and  parasitism  on  the  part  of  the  industry  engaging  her  ;  and  that 
to  uphold  such  a  living  standard  among  those  whose  bargaining 
power  is  weak,  minimum-wage  laws  are  universally  to  be  enacted 
and  administered.  On  the  other  hand  is  the  inescapable  fact  that 
of  the  fifteen  states  already  having  minimum-wage  laws  upon  their 
statute  books  only  three  have  in  operation  any  rulings  of  wide 
application  that  the  scientific  student  of  minimum  standards  could 
term  at  all  adequate.  Eight  have  a  series  of  substandard  rulings, 
and  the  remaining  four  have  none  at  all. 

It  will  be  the  task  of  this  paper  to  set  forth  some  of  the  reasons 
for  this  anomalous  state  of  affairs,  to  point  out  the  difficulties  under 
which  our  minimum-wage  commissions  are  laboring,  and  to  suggest 
certain  principles  of  drafting  and  administration  that  might  bring 
our  practice  into  closer  conformity  with  our  announced  theory. 

I  CHARACTERISTICS  OF  THE   FIRST  MINIMUM-WAGE 
LEGISLATION,  AUSTRALIAN  AND  BRITISH 

The  origin  of  minimiim-wage  legislation  is  to  be  sou&ht  not  in 
this  country  but  in  England  and  Australia.  Familiar  as  this  fact 
is,  its  significance  appears  to  have  escaped  popular  attention.  The 
first  rudimentary  organs  of  minimum-wage  administration  were  the 
District  Conciliation  Boards  of  New  Zealand,  established  in  1894  for 
the  compulsory  arbitration  of  labor  disputes.    Incidental   to  their 

^From  American  Economic  Review,  Vol.  IX  (1919),  pp.  701-738. 

738 


AMERICAN  MINIMUM-WAGE  LAWS 


739 


general  duty  of  so  supervising  and  directing  collective  bargaining  as 
to  preserve  industrial  peace,  they  were  given  authority  to  fix  mini- 
mum wages.  The  first  independent  wage-fixing  agencies  were,  how- 
ever, created  two  years  later  in  the  state  of  Victoria  in  Australia. 
They  were  called  Speciaj^^^^^^  ^^^  ^^^^  at  first  established  experi- 
mentally  for  certain  notoriously  sweated  trades  that  employed  both 
men  and  women.  These  boards  were  composed  of  an  equal  number 
of  employers  and  employees,  with  a  chairman  from  outside  nominated 
by  both  parties.  They  were  given  no  explicit  criterion  to  go  upon 
mTraming  their  wage  awards,  but  were  apparently  expected  to  argue 
out  their  difficulties  in  true  collectiv^bargaining  style,  under  the  su- 
pervision of  the  disinterested  outsider,  their  chairman,  who  was  to 
represent  the  public  interest. 

So  successful  was  this  system  that  it  was  extended  to  more  and 
more  trades,  was  adopted  by  other  Australian  states,  and  finally, 
in  1909,  by  England.  The  essence  of  the  system  is  the  free  dis- 
cussion of  wage  standards  by  the  authorized  representatives  of  both 
sidH^  with  the  aid  and  criticism  of  one  or  more  impartial  outsiders  ; 
the  fixing,  by  this  responsible  bipartisan  group,  of  standards  that 
are  thereupon  compulsory  upon  all  employers  in  the  industry  ;  and 
the  reservation  by  the  government  of  power  to  suspend  or  otherwise 
mitigate  rulings  that  appear  positively  unfair  or  inexpedient.  No 
definite  cost-of-living  criterion  is  set  up.  The  level  of  the  standards 
finally  fixed  will  rather  depend  upon  the  general  temper  of  the  com- 
munity in  which  the  law  is  operative  and  upon  the  respective  bar- 
gaining power  of  the  two  sides.  Thus,  in  Australia,  a  young  and 
rather  radical  country,  with  labor  relatively  scarce  and  powerfully 
organized,  the  tendency  has  been  for  the  wages  fixed  to  equal  or  even 
exceed  the  minimum  necessary  for  livelihood  ;  while  in  England,  with 
its  cautious  public  and  overstocked  labor  market,  the  tendency,  espe- 
cially in  the  first  years  of  the  law's  administration,  has  been  in 
the  opposite  direction  :  the  wages  fixed,  although  well  in  advance  of 
previous  rates  for  the  trades  concerned,  have  been  as  a  rule  avowedly 
below  the  subsistence  minimum. 

Certain  safeguards  in  the  English  law  itself  (Trade  Board  acts  of 
1909)  have  accentuated  this  difference.  In  the  first  place,  the  pro- 
visions of  the  act  could  only  be  extended  to  other  trades  than  the 
four  originally  specified,  "if  they  [that  is,  the  Board  of  Trade,  the 


it 


a 


§ 


1^ 


^^S'. 


lipi 


i 


iifi 


740       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

general  supervisory  body  that  establishes  the  separate  trade  board] 
are  satisfied  that  the  rate  of  wages  prevailing  in  .  .  .  the  trade 
is  exceptionally  low^  as  compared  with  that  in  other  employments, 
and  that  the  other  circumstances  of  the  trade  are  such  as  to  render 
the  application  of  the  Act  .  ,  .  expedient.''^  In  other  words,  boards^ 
could  not  be  established  upless  conditions  in  the  trade .were_worse 
even  than  in  neighboring  trades,  and  then  only  if  the  financial  state 
of  the  business  was  sufficiently  healthy.  Yet  in  England,  prior  to 
the  war,  wages  in  all  the  great  woman-employing  industries  were 
notoriously  low,  while  the  industries  that  were  submerged  even 
beneath  this  level  were  extremely  apt  to  be  in  a  declining  condition 
financially.  This  clause  in  the  law  is  therefore  very  interesting  as 
showing  that  business  considerations  were  explicitly  given  priority 
over  humanitarian. 

In  the  Victorian  statute,  on  the  other  hand,  these  two  sets  of 
considerations  were,  in  the  last  resort,  apparently  to  be  considered 
as  parallel  and  noninterfering  —  an  interesting  comment  upon  the 
general  level  of  wages  apparently  contemplated  by  the  Victorian 
draftsmen.  The  Court  of  Industrial  Appeals  (the  final  reference 
tribunal  for  the  separate  boards)  is  to  consider,  in  its  review  of  any 
ruling,  ''whether  the  determination  appealed  against  has  had  or  may 
have  the  effect  of  prejudicing  the  progress,  maintenance  of,  or  scope 
of  employment  in  the  trade  .  .  .  affected  ;  and  ...  [if  so]  ... 
the  court  shall  make  such  alterations  as  in  its  opinion  may  be 
necessary  to  remove  or  prevent  such  effect  and  at  the  same  time  to 
secure  a  living  wage  to  the  employees."^ 

Another  new  safeguard  introduced  in  the  English  law  was  the 
prolongation  of  the  period  of  initial  delay  before  any  ruling  could 
go  into  effect,  together  with  elaborate  provisions  for  indefinite 
suspension  by  the  Board  of  Trade  afterwards  in  case  the  ruling 
appeared  to  them  "premature  or  otherwise  undesirable."^ 

So  much  for  the  negative  features  of  the  English  law.  On  the 
positive  side  we  find  a  centralization  of  supervisory  power  in  one 

1  British  Trade  Boards  Act,  looo,  Section  i,  (2)  (italics  mine).  This  statute  and 
almost  all  the  succeeding  ones  quoted  in  this  article  may  be  found  in  "Oregon 
Minimum  Wage  Brief,"  by  Felix  Frankfurter  and  Josephine  Goldmark,  pp.  1-76. 
The  individual  notation  of  the  American  laws  has  therefore  been  omitted. 

2 Factories  and  Shops  Act,  191 2,  Section  175  (italics  mine). 

3 British  Trade  Boards  Act,  Sedition  5,  (2). 


AMERICAN  MINIMUM-WAGE  LAWS 


741 


permanent  government  body,  the  Board  of  Trade,  and  the  giving 
of  great  flexibility  to  the  possible  scope  of  the  wage  rulings  them- 
selves :  "  Those  rates  may  be  fixed  so  as  to  apply  universally  to  the 
trade,  or  so  as  to  apply  to  any  process  ...  or  to  any  special  class 
of  workers  ...  or  to  any  special  area."^ 

Both  England  and  Australia  make  special  provision,  by  individual 
permit,  for  infirm  workers  to  receive  less  than  the  established 
minimum. 

II.  GROWTH  OF  AMERICAN  LEGISLATION  :  THE  MASSACHU- 
SETTS AND  OREGON  PRINCIPLES  CONTRASTED 

Such  was  the  status  of  minimum-wage  legislation  when  it  was 
first  seriously  considered  by  this  country  in  191 1.  In  that  year  the 
Massachusetts  legislature  passed  a  resolve  requesting  the  governor 
to  appoint  an  investigating  commission  "to  study  the  matter  of 
wages  of  women  and  minors,  and  to  report  on  the  advisability 
of  establishing  .  .  .  [wage]  boards.  .  .  ."-  This  Commission  on 
Minimum-Wage  Boards  submitted  an  excellent  report  together  with 
the  draft  of  a  bill  which,  with  certain  important  modifications,  was 
thereupon  enacted  into  law. 

Inits-Driginal  form  this  Massachlisettsbill  followed  the  British  and 
Aij^jT^lbp  5;y^tpm  .as^4±js£lv  as  American  constitutional  limitations 
permitted ;  but  these  limitations  were  of  the  greatest  importance. 

1.  The  American  law  could  apply  only  to  women  and  minors, 
since  if  it  were  extended  to  men  it  would  most  certainly  be  held  by 
the~c"ourts  to  run  counter  to  the  "  freedom  of  contract "  clause  of 
the  Fourteenth  Amendment. 

2.  The  American  law  must  beware  of  delegating  legislative  func- 
tions to  an  administrative  agency.  It  must  therefore  clearly  define 
(fl)~the  conditicns  under  which  an  industry  should  fall  within  the 
sco4i£Lof  the  wage  commission  at  all;  {b)  the  criteria  upon  which 
wage  awards  were  to  be  rendered  ;  {c)  the  exact  relation  of  board 
to  commission.  Since  the  commission  was  the  permanent  supervisory 
body,  the  only  safe  course  was,  obviously,  to  centralize  all  ultimate 
responsibility  in  its  hands. 

The  essential  features  of  the  Massachusetts  bill  were  accordingly 
as  follows  :    ( i )  It  provided  for  a  permanent  appointive  commission, 
1  British  Trade  Boards  Act,  Section  4,  (i).        2 Resolves  of  igii,  chap.  71. 


ijt: 


I 


A 


742       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

with  power  (a)  "to  inquire  into  the  wages  paid  to  the  female  em- 
pioyeeSlmmybccupatron  in  the  Commonwealth  if  the  commission 
has  reason  to  believe  that  the  wages  paid  to  a  substantial  number 
of  such  employees  are  inadequate  to  supply  the  necessary  cost  of 
living  and  to  maintain  the  worker  in  health'''')'^  (b)  thereupon  to 
"  establish  a  wage  board  consisting  of  not  less  than  six  representatives 
of  employers  in  the  occupation  in  question,  of  an  equal  number  of 
representatives  of  the  female  employees,  .  .  .  and  of  one  or  more  dis- 
interested persons  ...  to  represent  the  public  .  .  .";2  and  (c)  upon 
the  receipt  of  a  report  from  the  board  to  "approve  any  or  all  of 
the  determinations  recommended  ...  or  [to]  recommit  the  sub- 
ject to  the  same  or  to  a  new  wage  board."  ^  Once  approved,  the  rates 
were  to  be  rendered  obligatory,  after  due  notice  and  public  hearing, 
by  a  formal  order  of  the  commission  effective  in  sixty  days.  Vio- 
lation of  the  order  constituted  a  misdemeanor  punishable  by  fine 
and  imprisonment.  (2)  The  basis  of  wage  determination  by  the 
boards  was  made  explicitly  the  double  one  of  cost  of  living  plus 
financial  condition  of  the  business,  with  the  business  considerations 
evidently  taking  the  priority  : 

Each  Wage  Board  shall  take  into  consideration  the  needs  of  the 
employees,  the  financial  condition  of  the  occupation  and  the  prob- 
able effect  thereon  of  any  increase  in  the  minimum  wage  paid,  and 
shall  endeavor  to  determine  the  minimum  wage  .  .  .  suitable  for  a 
female  of  ordinary  ability.  . 


»4 


Apparently  it  was  presupposed  that  the  "suitable"  wage  finally 
reached  would  commonly  be  below  the  actual  cost  of  subsistence. 
Such  a  view  is  borne  out  by  the  cautious  words  of  the  investigating 
commission's  report :  "  It  is  the  opinion  of  this  Commission  .  .  . 
that  in  all  these  industries  the  wage  scale  will  stand  a  readjustment 
of  rates  that  will  raise  the  lowest  wages  to  something  nearer  the 
living  wage.  .  .  ."^ 

^  Section  3  (italics  mine) . 

2 Section  4  (italics  mine). 

3  Section  6. 

■* Section  5  (italics  mine).  It  was  hoped  that  the  weight  given  the  employer's 
interests  would  avoid  collision  with  the  "due  process"  clause  of  the  Fourteenth 
Amendment. 

^'Report  of  Massachusetts  Commission  on  Minimum-Wage  Boards,  p.  24 
(italics  mine). 


II 


AMERICAN  MINIMUM-WAGE  LAWS 


743 


Even  so  careful  a  statute  was,  however,  unable  to  run  the  gant- 
let of  the  Massachusetts  legislature.  Before  its  final  passage  the 
bill  was  shorn  of  its  most  vital  portion,  the  section  on  enforcement. 
The  "orders"  of  the  commission  were  changed  to  mere  "recom- 
mendations," and  the  penalty  of  fine  and  imprisonment  to  mere 
adverse  publicity.  The  recalcitrant  employer  in  Massachusetts  is 
now  faced  with  nothing  worse  than  the  publication  of  his  name 
in  certain  newspapers ;  and  even  this  penalty  he  can  avoid  if 
he  can  prove  before  a  court  that  "compliance  with  the  recom- 
mendations of  the  Commission  would  render  it  impossible  for  him  to 
conduct  his  business  at  a  reasonable  pro  fit. ''  ^  Profits,  in  other  words, 
are  avowedly  made  a  "first  charge"  upon  the  business. 

The  weaknesses  of  this  earliest  of  American  minimum-wage  laws 
may  accordingly  be  summed  up  as  follows,  under  the  three  heads  of 
principle  of  wage  determination,  character  of  wage-fixing  agency,  and 
method  of  enforcement. 

1.  Principle  of  wage  determination.  Women  (normal,  experi- 
enced7"adult  women)  shall  receive  wages  just  high  enough  to  keep 
them  alive  and  physically  well,  provided  their  doing  so  does  not 
threaten  to  interfere  either  with  the  general  financial  prosperity  of 
the  trade  or  with  the  "reasonable  profits"  of  an  individual  employer. 

2.  X^^  agency  for  the  immediate  carrying  out  of  these  principles 
is  a  large  mixed  board  of  employers  and  employees,  with  in  no 
case  more  than  one  fifth  of  the  total  membership  representing  the 
disinterested  public. 

3.  The  sole  means  of  enforcement  is  in  the  indirect  pressure  of 
public  opinion.  Boards  and  commission,  therefore,  know  beforehand 
tEaTany  ruling  that  threatens  to  prove  burdensome  to  the  individual 
employer  can  safely  be  disobeyed,  that  anything  approaching  drastic 
action  will  tend  to  defeat  its  own  ends. 

In  view  of  all  these  limitations  it  is  surprising  to  find  how  much 
has  been  accomplished  in  Massachusetts.  The  mere  focusing  of  atten- 
tion upon  the  problem  of  wages  and  livelihood  appears  to  have  sufficed 
materially  to  raise  the  wages  in  many  submerged  trades.  The  usual 
process  is  for  the  board  to  thresh  out  what  they  agreed  to  be  a 

^  Section  6  (italics  mine).  As  a  matter  of  fact,  the  Commission  has  not  found 
it  worth  while  to  publish  such  a  black  list;  instead  it  occasionally  publishes 
white  lists  of  such  employers  as  do  comply! 


.^^mp^ 


'9  '- 
-f  ■ 


1  - 


II: 


744       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

minimum-subsistence  budget  and  then  to  see  how  close  they  think 
they  can  come  to  that  without  infringing  upon  the  "financial  condi- 
tion of  the  business"  or  (what  amounts  to  the  same  thing)  without 
incurring  wholesale  violation  of  their  decree.  Usually  the  wage  finally 
agreed  upon  lags  about  a  dollar  behind  the  original  budget  ;^  while 
this  in  turn  has  usually  omitted  or  cut  down  below  the  subsistence 
level  a  good  many  necessary  items  ;  even  so,  the  minimum  is  usually 
a  distinct  advance  over  previous  rates.  Thus  in  the  brush  industry, 
the  first  to  be  investigated,  the  original  budget  came  to  $8.71  ;  the 
legal  "suitable"  rate  was  established  at  15^  cents  an  hour,  which 
allowed  the  average  worker  to  earn  about  S7,"  but  previous  average 
earnings  had  been  below  $6.  The  percentage  of  violations  at  the  end 
of  the  first  year  was  gratifyingly  low,  and  has  been  reported  to  be 
decreasing  since.^ 

1  Massachusetts  Budgets  and  Wage  Decrees  to  July  1,  1919* 


AMERICAN  MINIMUM-WAGE  LAWS 


745 


Board 

Budget  Total 

Date  of 
Budget 

Decree 

Date  when 
Effective 

Brush 

$8.71 

Jan.,  1914 

15^  c.  hr. 

Aug.  15,1914 

Candy      

8.75 

Summer,  1914 

(no  decree) 

Laundry 

8.77 

Winter,  191 5 

$8.00 

Sept.  1, 1915 

Retail  stores   .    .    . 

(no  exact 
budget) 

8.50 

Jan.  I,  1916 

Women's  clothing  . 

8.98 

Spring,  191 6 

8.75 

Feb.  1, 1917 

Men's  clothing    .     . 

10.00 

Spring,  1917 

9.00 

Jan.  I,  1918 

Men's  furnishings  . 

10.45 

Summer,  1917 

9.00 

Feb.  I,  1918 

Muslin  underwear  . 

9.65 

Winter,  19 18 

9.00 

Aug.  I,  1918 

Retail  millinery  .    . 

11.64 

Spring,  1918 

10.00 

Aug.  I,  1918 

Office  cleaners    .    . 

"•54 

Spring,  1918 

30  c.  hr.  night  work 
26  c.  hr.  day  work 

Mar.  I,  1 919 

Wholesale  millinery 

12.50 

Fall,  1918 

11.00 

Jan.  I,  1919 

Candy     

12.50 

June  5,  1919 

12.50 

Jan.  1, 1920 

Canning 

11.00 

June  24,  1919 

11.00 

Sept.  1, 1919 

•From  Sixth  Annual  Repjort  of  Massachusetts  Mini  mum- Wage  Commission,  Appendixes  3  and  4  ; 
and  Monthly  Labor  Review,  April  and  August,  19 19. 

2  This  rate  was  based  on  the  supposition  of  a  fifty-four-hour  week,  which 
would  here  have  given  the  worker  $8.37.  However,  the  industry  was  notorious 
for  its  prevalence  of  short-time  work. 

^  It  has  averaged  only  about  i  per  cent  of  the  employees  covered.  (Report  of 
the  Minimum-Wage  Commission,  1915  and  1917,  pp.  14-15  and  32.)    However, 


The  example  of  Massachusetts  so  encouraged  progressive  groups 
in  various  parts  of  the  Union  that  in  the  following  year  eight  other 
states  passed  minimum-wage  laws.  Of  these  by  far  the  most  im- 
portant is  Oregon's.  It  has  served  as  a  model  for  the  bulk  of  our 
subsequent  legislation,  and  may  fairly  be  contrasted  with  the  original 
Massachusetts  statute  as  showing  the  growing  definiteness  and 
articulateness  of  the  living-wage  idea. 

1ie_.Qregon_law  provides  for  a  central  administrative  commis- 
sion and  subsidiary  boards' appointed  by  it  after  the  Massachusetts 
fashion,  working  through  the  orthodox  machinery  of  public  hearings 
and  private  investigations  and  conferences  ;  but  this  machinery  is 
to  be  used  for  strictly  living-wage  ends.    Section  i  reads : 

It^shall  be  unlawful  to  employ  women  in  any  occupation  .  .  .  for 
wages  which  are  tnadequaTe  lo~suppLy  the  necessary  cost  of  living  and 
tu  iiidiiitdiu-^hem-  iTi'  heaTlh  rancrTf  shall  be  unlawful  to  employ 
minors  ...  for  unreasonably  low  wages. ^ 

Boards  and  commissions  alike  are  given  no  other  criterion  of  wage 
fixing  than  this  simple  and  explicit  one  of  the  "necessary  cost  of 
living."  No_mention  is  made  anywhere  of  suitability,  expediency, 
oxjhe  financiaTcondiHon  of  the  industry;  instead,  in  every  para- 
graph the  cost-of-living  basis  is  repeated  in  identical  words. 

Once  the  recommendations  of  a  board  have  been  approved  by  the 
commission,  they  are  issued  as  obligatory  orders,  binding  within 
sixty  days  upon  ever>'  employer  in  the  industry,  regardless  of  his 
difficulties  in  meeting  them;  disobedience  is  punishable  by  heavy 
fine  and  imprisonment.  Moreover,  the  personnel  of  the  subsidiary 
boards  (here  called  conferences)  is  so  arranged  that  impartial  de- 
cisions are  more  easily  rendered :  the  whole  board  is  smaller,  the 
representatives  of  the  public  have  a  larger  share  of  the  membership, 
and  every  board  has  at  least  one  member  of  the  central  commission 

other  determinations  of  the  Commission  have  not  been  so  well  received.  Thus 
the  great  majority  of  laundry  employers  refused,  illegally  but  successfully 
(1Q15-1917),  even  to  allow  the  Commission  to  examine  their  pay  rolls  to  see 
what  their  degree  of  compliance  was  (1915  Report,  p.  15;  1017  Report,  p.  35) ; 
while  within  the  women's  clothing  industry  the  Commission  reports  (1917 
Report,  p.  36),  "Complete  compliance  was  found  ...  in  only  about  half  of 
the  custom  dressmaking  establishments." 
1  Italics  mine. 


m 


'  'I 


I 


746       TRADE  UNIONISM  AND  LABOR  PROBLEMS 
sitting  officially  on   it.^     In^  all    thpse  ways   the  Rouble-standard, 

collective-bargaining  idea — the  nffi<:ial  halanrincr  nf  Q|;jj;^n«;jn£r  JrjtpfptttQ 

— W5uld  seem  to  have  given  way  before  that  of  the  living  wage  pure 
and  simple^  ~" 

It  "may  well  be  asked,  What  could  have  caused  so  radical  a  change 
in  legal  principle  in  one  short  year  ?  The  answer  is  probably  two- 
fold. On  the  one  hand,  Oregon  is  a  Western  state,  with  more  radical 
views  in  regard  to  industry,  a  relatively  small  number  of  women 
employees,  and  a  radical  method  of  legislation  (the  minimum  wage 
was  an  initiative  measure).  On  the  other  hand,  Oregon  had  the  ad- 
vantage of  being  the  second  state  to  pass  such  a  law  :  she  already 
had  the  solid  precedent  of  Massachusetts  to  go  upon;  and,  since 
American  constitutionalism  required  the  wage-fixing  basis  to  be  quite 
definite  in  any  case,  it  became  relatively  easy  for  the  Oregon  advo- 
cates to  insist  upon  sloughing  off  the  "double-faced"  and  apparently 
mercenary  elements  of  the  older  law. 

Of  the  thirteen  statutes  that  have  followed  Massachusetts  and 
Oregon  nine  may  be  said  roughly  to  have  copied  the  Oregon  model, 
one  the  Massachusetts  model,  while  three  have  to  be  put  into  a 
separate  category  as  flat-rate  laws.^ 

III.  FLAT-RATE  LAWS 

Tb,p  flat-ratP  laws  differ  from  both  the  earlier  models  in  that  they 
jjiperate  not  through   commissions  but   through  direct  fiat  of   the 

^"Such  conference  shall  be  composed  of  not  more  than  three  representatives 
of  the  employers  in  said  occupation,  of  an  equal  number  of  .  .  .  employees 
.  .  .  and  of  not  more  than  three  disinterested  persons  representing  the  public 
and  of  one  or  more  commissioners"  (Section  8). 

-  Chronologically  the  laws  run  as  follows : 

191 2  —  Massachusetts. 

1913  — California,  Colorado  (on  the  Massachusetts  model,  now  obsolete), 

Minnesota,  Nebraska  (repealed  1919),  Oregon,  Utah,  Washington, 
Wisconsin. 
191S  —  Arkansas,  Kansas. 

191 7  — Arizona,  Colorado  (new  law,  on  the  Oregon  model). 

1918  — District  of  Columbia. 

1919— North  Dakota,  Texas;  also  Porto  Rico. 
The  gap  in  legislation  that  occurred  during  1915-1917  was  due  to  long-drawn 
litigation  in  the  Oregon  case.    The  law  was  finally  upheld  by  a  divided  opinion 
of  the  Supreme  Court  — Justice  Brandeis,  as  previous  counsel  for  the  defense, 
not  voting. 


AMERICAN  MINIMUM-WAGE  LAWS 


747 


statute^ itself.  The  different  rates  for  experienced  adults,  learners, 
and  minors  are  set  once  and  for  all  in  the  body  of  the  law  and  apply 
uniformly  throughout  the  state  to  all  industries  specified.  The  ad- 
vantages oi  flat-rate  legislation  are  that  it  (i)  avoids  the  constitu- 
tional difficulty  of  delegation  of  powers  and  (2)  is  extremely  simple 
ang~cHeap  to  administer.  Its  overwhelming  disadvantage  is  of  course 
its  lack  of  flexibility. 

The  simplest  and  most  inflexible  of  our  flat-rate  laws  is  that  of 
Arizona  (1917).  It  covers  all  manufacturing,  mercantile,  hotel, 
restaurant,  and  office  occupations  and  sets  for  them  one  simple  state- 
wide minimum  of  Sio  for  all  females,  of  whatever  age  or  experience. 

Somewhat  more  discriminating  is  the  Utah  statute  of  19 13.  It 
applies^  to  all  females  in  all  lines  of  industry,  but  sets  lower  rates 
for  minors  and  learners  than  for  experienced  adults.  The  adult  rate 
is  $7.50  per  fifty-four-hour  week.  These  rates  were  set  in  1913  at 
the  passage  of  the  original  act  and  have  never  been  changed  since. 
This  is  not  surprising,  since  it  would  take  a  statutory  amendment 
to  do  so. 

The  Arkansas  law  (191 5)  at  first  glance  looks  like  a  genuine 
hybrid  between  the  flat-rate  and  the  commission  principle.  It  sets 
the  same  series  of  state-wide  rates  as  Utah,  culminating  in  the  same 
$7.50  for  experienced  women,  but  it  establishes  at  the  same  time 
a  minimum-wage  commission  of  the  usual  type,  under  the  chairman- 
ship of  the  Commissioner  of  Labor,  to  revise  the  rate  by  localities 
or  trades  whenever  it  may  appear  either  too  high  or  too  low.  On  the 
face  of  it  this  would  seem  a  good  compromise,  combining  the  advan- 
tages of  a  universal  basic  rate  with  those  of  periodic  local  adjustment. 
In  practice,  however,  the  periodic  adjustment  has  never  taken  place ; 
the  commission  feature  of  the  law  has  remained  entirely  unutilized. 
In  consequence,  when,  in  August,  19 18,  the  National  War  Labor 
Board  was  called  in  to  consider  the  case  of  the  laundry  industry  in 
Little  Rock,^  it  found  the  operatives  still  receiving  their  19 15  mini- 
mum of  $7.50  per  fifty-four-hour  week,  and  promptly  raised  the  scale 
some  40  per  cent,  to  Sn — an  interesting  example  of  the  war-time 
supersession  of  state  by  federal  agencies.- 

1  National  War  Labor  Board,  Docket  No.  233. 

2 A  thorough-going  flat-rate  law  has  been  established  for  Porto  Rico  in  1919. 
It  provides  a  weekly  minimum  of  $6  for  exp>erienced  women  over  sixteen,  $4 
for  learners. 


H 

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748       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

IV,  COMMISSION  LAW  ON  THE  MASSACHUSETTS  MODEL 

Nebraska's  is  the  only  statute  that  at  the  beginning  of  19 19  still 
directly  followed  Massachusetts  in  its  two  characteristic  features. 
It  had  copied  verbatim  the  earlier  law's  explicit  consideration  of  the 
financial  condition  of  the  industry"  and  had  adopted  in  mitigated 
form  its  noncompulsory  provisions/  However,  although  passed  in 
19 13,  this  law  had  never  gone  into  operation,-  and  in  the  19 19  session 
of  the  legislature  it  was  repealed.  Now  that  the  constitutionality  of 
the  more  radical  type  has  been  upheld  in  the  Oregon  case,  there  seems 
little  likelihood  that  any  other  state  will  recur  to  the  older  model. 


V.  COMMISSION  LAWS  ON  THE  OREGON  MODEL 

Of  the  nine  laws  that,  following  Oregon,  have  both  enforceable 
decrees  and  an  unequivocal  cost-of-living  basis,  three  have  been 
rendered  inoperative  for  longer  or  shorter  periods  of  time  by  litiga- 
tion connected  with  the  Oregon  case,  while  a  fourth  has  as  yet  been 
inactive  (according  to  the  Commission)  because  of  war  conditions. 

^  It  provided  no  other  penalty  save  newspaper  publicity.  However,  the  pub- 
licity was  at  least  made  mandatory,  not  optional  with  the  Commission,  and  the 
employer  seeking  exemption  from  it  would  have  had  to  prove  to  the  court  that 
compliance  would  endanger  not  merely  his  profits  but  "  the  prosperity  of  the 
business." 

The  Nebraska  law  also  copied  Massachusetts  in  a  less  important  objectionable 
feature,  namely,  the  requirement  of  a  two-thirds  majority  for  all  decisions  of 
wage  boards.  In  Massachusetts  this  has  operated  as  a  direct  incentive  to  ob- 
stinacy on  the  part  of  the  employers,  since  employees  and  public,  even  though 
combined  unanimously,  could  never  outvote  them.  (See,  e.g.,  the  account  of 
the  disagreement  of  the  Office  Cleaner's  Board,  1918,  in  the  Monthly  Labor 
Review,  April,  1919,  p.  187.)  In  Nebraska  the  provision  would,  however,  have 
been  mitigated  in  practice  by  the  companion  provision  that  each  board  must 
have  on  its  membership  as  representatives  of  the  public  the  entire  body  of 
commissioners  (four). 

2  In  explanation  of  their  failure  to  put  any  minimum  wage  into  operation, 
the  Nebraska  Commission  stated  that  no  complaints  were  made  :  "  Since  the 
adoption  of  the  law  in  1913,  no  complaint  has  been  filed  with  the  Commission, 
and  therefore  no  meeting  of  the  Commission  has  ever  been  held.  .  .  .  There 
had  been  more  or  less  agitation  before  this  Commission  was  created  in  1913,  and 
during  the  session  of  legislatures  since,  but  there  seem  to  have  been  no  reports 
of  any  kind  made"  (letter  to  the  Secretary  of  the  American  Association  for 
Labor  Legislation,  July  22,  1918). 


AMERICAN  MINIMUM-WAGE  LAWS 


749 


The  new  Colorado  Commission  (191 7)  states  that,  owing  to  the 
war,  ..."  there  was  no  cause  for  complaint  from  the  classes  affected 
by  the  Act,  and  consequently  this  Commission  has  had  very  little 
...  to  do  thereunder."  1  As  a  matter  of  fact,  however,  this  inactiv- 
ity may  well  have  been  due,  at  least  in  part,  to  a  more  absorbing 
interest  in  matters  outside  the  minimum  wage.  The  Commission  here 
is  a  general  State  Industrial  Commission,  with  many  duties. 

The  Wisconsin  law  (19 13)  also  gave  the  wage-fixing  power  into 
the  hands  of  its  general  Industrial  Commission.  "  During  1914-1917," 
writes  their  secretary,  "  this  Commission  believed  that  little  could  be 
gained  by  establishing  a  minimum-wage  scale  which  would  im- 
mediately be  tied  up  by  an  injunction,"  while  for  some  time  there- 
after they  were  hampered  by  lack  of  funds.-  However,  now  (since 
August  I,  19 19)  they  have  established  a  state-wide  minimum  for 
experienced  women  and  minors  over  seventeen,  in  all  occupations,  of 
22  cents  per  hour  (or  $12.10  per  fifty-five-hour  week). 

The  Kansas  law  gives  the  power  of  fixing  wages  into  the  hands 
neither  of  a  minimum-wage  commission  pure  and  simple  nor  of  a 
general  industrial  commission,  but  of  a  so-called  Industrial  Welfare 
Commission  created  for  the  purpose  of  setting  standard  hours  and 
conditions  of  work  as  well  as  wages.  In  this  respect  it  follows 
Oregon^  and  the  other  two  coast  states  yet  to  be  cited.* 

Established  as  it  was  in  191 5  after  the  beginning  of  the  Oregon 
litigation,  the  Kansas  Commission  has  only  been  operative  since 
March,  191 8.  The  Minnesota  Commission,  established  two  years 
earlier,  had  the  advantage  of  a  year's  enforcement  of  its  rulings  be- 
fore the  opening  of  the  Oregon  case,  and  revived  those  rulings  later 
in  19 1 8.  Both  commissions  had  evidently  suffered  from  the  cooling- 
off  process  incident  to  so  long  a  delay ;  they  declared  themselves 
unable  to  adjust  the  recently  legitimatized  rates  to  present  prices. 
"Our  first  minimum  wage  went  into  effect  on  March  18  of  this 
year  (1918),"  writes  a  representative  of  the  Kansas  Commission."^ 

^Second  Report,  Colorado  Industrial  Commission,  pp.  127-128. 

2  Letter  to  the  writer,  December  12,  1918. 

3  It  did  not  seem  necessary  while  dealing  with  the  Oregon  law  to  point  out 
this  additional  administrative  distinction,  since  it  in  no  way  affects  the  essential 
nature  of  the  wage  award. 

*  The  Washington  Commission  does  not  have  power  to  fix  hours,  only  wages 
and  working  conditions.  'Letter  to  the  writer,  October  31,  1918. 


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750       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

"We  consider  that  .  .  .  [it]  is  very  low.  [Their  rate  for  experi- 
enced women  in  stores  and  laundries  is  only  $8.50,  although  for 
factories  it  has  more  recently  been  raised  to  $11.]  However,  it  was 
as  much  as  the  employers  on  our  Board  would  concede."  A  repre- 
sentative of  the  Minnesota  Commission  adds :  ^ 

The  Commission  was  reappointed  on  April  ist  of  this  year  (19 18) 
[the  Minnesota  law  had  finally  been  declared  constitutional  three 
weeks  before],  and  it  decided  to  enforce  the  wage  orders  already  is- 
sued .  .  .  based  on  the  cost  of  living  in  normal  times  in  order  that 
the  law  might  go  into  effect  at  once.  [These  rates  provided  a  maxi- 
mum of  S9  for  experienced  workers  in  first-class  cities.]  If  wage 
rates  were  to  be  altered  the  Commission  would  have  had  to  make  an 
exhaustive  study  into  the  cost  of  living  covering  the  entire  state 
because  our  Attorney  General  has  ruled  that  wage  rates  must  be 
state-wide  in  their  effect  when  established.  This  would  have  meant 
a  delay  of  at  least  six  months  in  the  enforcement  of  the  law.^ 

Two  other  commission  laws,  those  of  Texas  and  North  Dakota, 
have  been  enacted  only  this  year  (19 19),  so  that  no  rulings  have 
as  yet  been  issued  under  them.  The  Texas  law  provides  for  an 
Industrial  Welfare  Commission,  headed  by  the  Chief  of  the  Bureau  of 
Labor  Statistics,  while  the  North  Dakota  law,  in  unique  fashion,  gives 
the  power  of  fixing  wages,  hours,  and  working  conditions  into  the 
hands  of  its  state  Workmen's  Compensation  Bureau. 

The  four  remaining  commission  statutes  of  a  compulsory  char- 
acter have  all  been  enforced  from  the  beginning^  and  have  resulted 
in  the  four  highest  sets  of  rates  yet  attempted.  They  belong  to  the 
three  Pacific  coast  states  (1913)  and  the  District  of  Columbia 
(1918).  The  Pacific  states  have  industrial-welfare  commissions, 
while  the  District  of  Columbia  has  a  regular  minimum-wage  com- 
mission. The  language  and  substantive  features  of  all  four  are,  how- 
ever, practically  identical,  the  Oregon  law  having  served  as  a  model 
for  the  rest. 

1  Letter  to  the  writer,  November  9,  iqi8  (italics  mine). 

2The  rates  have  since  been  scaled  up  (August,  1919).  Experienced  workers 
in  first-class  cities  now  receive  $11  per  week  of  forty-eight  hours  or  less. 

3  Strictly  speaking,  the  California  law  did  not  really  get  under  way  until 
after  the  Oregon  decision.  During  1914-1915  the  Commission  confined  itself  to 
a  thorough  investigation  of  wages  and  cost  of  living,  and  in  1916  issued  but 
one  order,  that  on  canneries.  As  soon  as  the  Oregon  decision  was  rendered, 
however,  in  April,  191 7,  the  Commission  sprang  into  full  activity. 


ft   , 


AMERICAN  MINIMUM-WAGE  LAWS 


751 


All  four  sets  of  rulings  are  now  based  on  a  forty-eight-hour  week. 
For  this,  Oregon  and  Washington  fix  $13.20  as  the  minimum  wage; 
California,  $13.50;  and  the  District  of  Columbia,  for  the  two  trades 
with  which  it  has  so  far  dealt— printing  and  publishing  and  mer- 
cantile—no less  than  $15.50  and  $16.50.  All  these  rates  have  been 
either  newly  set  or  revised  within  the  past  year.  (Washington's 
minimum  dates  only  to  November,  19 19,  while  Oregon's  became 
effective  October  14,  1918.)  The  three  Pacific  coast  rates,  like  that 
of  Wisconsin,  are  most  noteworthy  in  that,  for  the  first  time,  they 
apply  uniformly  to  all  trades  covered  by  the  law. 

Two  sets  of  factors  aside  from  the  drafting  of  the  laws  themselves 
may  have  contributed  to  make  these  four  recent  sets  of  rates  so  high : 
in  the  Pacific  coast  states  a  greater  readiness  to  "give  women  a 
chance,"  coupled  with  a  lesser  degree  of  overcrowding  in  the  female- 
labor  market ;  in  the  District  of  Columbia,  the  immediate  proximity 
of  the  United  States  Bureau  of  Labor  Statistics,  with  its  wealth  of 
scientific  material  plus  personal  explanation  at  the  immediate  service 
of  boards  and  commission.  However,  what  is  perhaps  still  more  im- 
portant, all  these  states  have  had  close  contact  between  commission 
and  local  wage  board.  In  California  the  executive  officer  of  the  com- 
mission acted  as  chairman  of  the  recent  boards,  while  in  the  record- 
breaking  District  of  Columbia  decision,  all  three  members  of  the 
commission  have  actually  thus  participated. 

VI.   DEFINITIONS   OF   THE   LIVING   WAGE 

The  variation  in  wording  of  the  living-wage  definitions  in  all  the 
various  statutes  we  have  seen  passing  in  review  does  not,  so  far  at 
least,  seem  to  have  had  any  direct  effect  upon  the  character  of  the 
decisions  rendered.  They  run  all  the  way  from  Kansas's  "  adequate 
for  maintenance"  and  "to  supply  the  necessary  cost  of  living" 
to  Minnesota's  "sufficient  to  maintain  the  worker  in  health  and 
supply  .  .  .  [her]  with  the  necessary  comforts  and  conditions  of 
reasonable  life"  and  Wisconsin's  "sufficient  .  .  .  [for]  .  .  .  wel- 
fare"—"welfare"  being  further  defined  as  "reasonable  comfort, 
reasonable  physical  well-being,  decency,  and  moral  well-being." 
Almost  all  the  statutes,  following  the  Oregon  and  Massachusetts 
precedent,  refer  to  health  ("  to  maintain  in  good  health  "),  and  many 
add  a  reference  to  moral  protection  or  to  general  welfare  or  both. 


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752       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

VII.  THE  ROLE  OF  THE  ADVISORY  BOARDS 

Another  variation  in  the  wording  of  the  statutes,  that  does  not 
seem  so  far  to  have  had  any  marked  effect  upon  their  operation,  is 
the  variation  in  the  role  assigned  the  subsidiary  wage  boards.  In 
some  states  their  appointment  is  mandatory,  in  others  optional  with 
the  central  commission.^  In  practice,  however,  with  one  exception 
(Minnesota),  all  the  commissions  that  are  actually  operative  have 
chosen  to  do  their  work  through  boards.^ 

This  may  seem  rather  surprising,  since  the  presence  of  the  boards 
necessarily  complicates  and  delays  every  decision.  It  means  a  larger, 
more  partisan,  and  less  well-informed  group  of  people  discussing  each 
issue.  However,  it  also  means  a  group  that  is  closer  to  the  public 
confidence.  The  board  members  are  themselves  direct  representatives 
of  employers  and  employees,  and  in  educating  each  other  in  methods 
of  straight  thinking  on  the  wage  problem  they  are  at  the  same  time 
helping  to  gain  that  general  good  will  without  which  so  new  and  ten- 
tative a  t3^pe  of  rulings  could  not  finally  succeed. 

Moreover,  as  a  purely  practical  question  of  time,  the  over- 
burdened volunteer-^  commissioner  in  a  large  industrial  state  could  not 
afford  to  go  exhaustively  into  the  technical  problems  of  each  trade 
and  then  sit  through  a  long  series  of  hearings  on  each.  The  local- 
board  members*  can  divide  up  this  responsibility  and  pool  their  in- 
formation at  the  end. 

Granted,  then,  that  it  has  proved  desirable  to  retain  the  services 
of  the  advisory  boards,  the  second  question  arises.  What  is  (or 
should  be)  the  limitation  of  their  power  as  over  against  that  of  the 
commission?    Once  their  advice  is  sought,  may  it  be  disregarded? 

iThe  new  (1919)  Texas  law  alone  makes  no  provision  for  the  calling  of 
such  boards. 

2  The  states  in  which  the  appointment  of  boards  is  mandatory  are  Massa- 
chusetts, Kansas,  Nebraska,  and  Wisconsin. 

3  In  most  states  the  members  of  the  commission  are  wholly  unpaid.  In 
Massachusetts  and  California  alone  do  they  receive  a  $10  per  diem.  Wisconsin, 
Colorado,  and  Utah  have  general  industrial  commissions  with  salaried  officers, 
but  their  minimum-wage  work  is  incidental. 

*  Board  members  are  ordinarily  paid  a  very  small  per  diem,  usually  the 
same  rate  as  jurors,  though  in  some  states  they  receive  nothing  at  all.  Only 
California  pays  as  much  as  Ss.  Even  these  small  amounts,  however,  form  a 
serious  drain  upon  the  all  too  scanty  funds  of  the  commissions. 


AMERICAN  MINIMUM-WAGE  LAWS 


753 


Here  interpretations  differ.  All  the  states  allow  the  commission  to 
reject  a  report  and  resubmit  the  subject  to  the  same  or  a  new  board ; ' 
but  the  real  question  is,  May  they  themselves  alter  the  recommenda- 
tions without  resubmittal? 

Certain  statutes,  such  as  those  of  Oregon,  Washington,  and  Kansas, 
have  been  interpreted  unequivocally  to  forbid  this,  and  the  com- 
missions chafe  under  the  strain.  A  representative  from  Kansas 
writes:  "We  believe  that  the  Boards  are  very,  very  helpful  indeed, 
but — that  after  the  public  hearing  the  Commission  should  be  able  to 
make  such  modifications  as  it  thinks  necessary  and  issue  the  ruling 
then  as  final." ^  On  the  other  hand,  certain  other  statutes,  notably 
that  of  California,^  plainly  leave  the  alternative  of  commission 
action  open. 

In  California,  consequently,  the  Commission  has  taken  very  useful 
advantage  of  its  privilege :  thus,  when  the  mercantile  and  laundry 
boards  of  191 7  failed  to  come  to  an  agreement,  the  Commission 
merely  made  note  of  the  two  conflicting  sets  of  budgets  and  proceeded 
to  establish  a  final  rate  of  its  own.*  Surely  this  is  preferable  to  the 
Kansas  and  Massachusetts  system. 

VIII.   THE   COMPOSITION   OF   THE   ADVISORY   BOARDS 

In  dealing  with  Massachusetts  and  Oregon  we  have  already  re- 
ferred to  the  eft'ect  of  variations  in  the  size  and  personnel  of  advisory 
bodies.  Obviously,  the  larger  the  board,  the  greater  will  be  its  tend- 
ency towards  debate  rather  than  scientific  analysis.  Similarly,  the 
larger  the  number  of  partisans  as  compared  to  the  number  of  repre- 
sentatives of  the  public,  the  less  likely  is  the  scientific  view  to  get  a 
hearing.  And,  finally,  the  wider  the  separation  of  the  board  from  the 
sources  of  information  accessible  to  the  permanent  commission,  the 
less  likely  is  the  scientific  view  even  to  be  understood.  The  most 

1  And  all  but  Minnesota  allow  them  thus  to  resubmit  any  part  of  the  subject. 

2  Letter  to  the  writer,  October  31,  1918. 

3 The  California  statute  reads:  "...  the  recommendation  of  such  wage 
board  shall  be  made  a  matter  of  record  for  the  use  of  the  Commission"  .  .  .; 
and  then:  ''The  Commission  shall  have  further  power  after  a  public  hearing 
had  upon  its  own  motion  or  upon  petition  to  fix  ...  a  minimum  wage  to  be 
paid  to  women  and  minors  .  .  ."    (Sections  5  and  6;  italics  mine). 

*See  Third  Biennial  Report  I.  W.  C.  of  California,  pp.  24  ff.  In  both  cases 
this  final  rate  approximated  that  of  the  employees. 


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754       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

efficient  board  is  therefore  unquestionably  one  in  which  the  total 
membership  is  small,  the  public  being  represented  equally  with  the 
other  two  sides,  and  on  which,  in  addition,  at  least  one  member  of 
the  central  commission  sits  permanently. 

This  last  requirement  is  fulfilled  in  Oregon,  Washington,  California, 
and  the  District  of  Columbia,  the  four  states  as  pointed  out  above 
whose  boards  have  so  far  promulgated  the  highest  rates.  In  Massa- 
chusetts the  practice  of  the  Commission  has  been  to  appoint  as  one 
representative  of  the  public  the  permanent  paid  secretary  of  the 
Commission,  who  is  known  as  "  the  executive  officer  of  the  board," 
and  appears  to  be  invested  with  a  good  deal  more  dignity  than  he  has 
in  most  states.  This  may  help  to  account  for  the  relatively  good  rul- 
ings that  the  Massachusetts  boards  have  issued.  Certainly  they  ap- 
pear to  have  been  better  informed  than  many  of  our  statutorily  more 
fortunate  bodies.  In  the  nature  of  the  case  the  secretary  of  a  com- 
mission is  an  excellent  person  to  represent  the  scientific  point  of  view 
to  the  other  members  of  an  advisory  board.  He  is  the  one  salaried 
expert  who  gives  his  full  time  to  the  work  of  the  commission,  and 
should  of  necessity  be  more  familiar  than  anyone  else  with  all  its 
sources  of  information.  His  effectiveness  is,  of  course,  further  en- 
hanced when  he  holds  full  voting  membership  in  both  bodies.  This  has 
belen  the  fortunate  practice  of  California,  where  the  "woman's  repre- 
sentative" on  the  Commission,  who  acts  also  as  its  ''executive  officer," 
serves  as  chairman  of  each  wage  board.  However,  California  has  the 
weakness  of  providing  for  no  other  representatives  of  the  public. 

IX.  PRACTICAL  DIFFICULTIES  IN  WAGE-SETTING  :   THE 
PROBLEM  OF  AN  ADEQUATE  ORIGINAL  WAGE 

When  it  comes  actually  to  fixing  a  "  living  wage,"  American  boards 
are  confronted  with  a  whole  series  of  difficulties.  In  the  first  place, 
whj,tever  xoay  be  said  in  the  language  of  the  statute  itself,  every  board 
member  knows  that  in  practice  therepresentativesjpf  the- employers 
and  all  who  sympathize  with  them  are  bounJ  to  take  the  condition 
of  the  industry  itself  into  consideration.  What  else,  indeed,  are  they 
there  for  ?  If  the  object  of  the  law  were  merely  to  establish  an 
abstractly  scientific  standard  of  living  for  each  employee,  regardless 
of  its  reaction  upon  conditions  of  employment  and  trade  in  general, 


AMERICAN  MINIMUM-WAGE  LAWS 


755 


why  work  through  representative  boards  at  all  ?      Why  not  merely 
have  a  central  executive  commission  or,  better  still,  a  single  paid 
expert  whose  duty  it  would  be  to  adjust  well-established   family 
standards   (such  as  those  issued  by  the  United  States  Bureau  of 
Labor  Statistics)   to  local  conditions  and  the  needs  of  the  single 
woman,  revising  these  standards  at  appropriate  intervals  as  the  cost 
of  living  went  up  or  down?     In  practice  everyone   knows   that 
minimum-wage  legislation  is  as  yet  in  a  tentative  stage,  that  public 
opinion  is  by  no  means  "solid"  behind  it,  and  that  the  work  of  con- 
ciliating and  bringing  into  cooperative  relations  the  members  of  all 
parties  represented  on  a  board  is  still  by  no  means  the  least  of  its 
functions.    The  unequivocal  language  of  our  statutes,  in  other  words, 
is  to  be  regarded  rather  as  a  guidepost  for  further  progress  than  as 
an  index  of  present  achievement,  and  the  most  that  forward-looking 
members  of  boards  and  commissions  can  do  is  to  keep  its  prospect 
fresh  in  the  eyes  of  their  colleagues.    The  great  majority  of  repre- 
sentatives of  the  public  at  present  tend  inevitably  to  side  with  the 
employers  so  far  as  taking  a  vivid  interest  in  the  financial  welfare 
of  the  business  goes.    Thus  questions  of  interstate  rivalry  are  always 
favorite  topics  of  discussion — Will  such  and  such  a  rate  put  the 
manufacturers  of  state  A  at  a  disadvantage  with  state  B?    Very 
few  are  the  representatives  of  the  public  who  will  not  give  at  least 
some  weight  to  such  considerations. 

In  the  second  place,  the  representatiyes-Xii-lb€.-employees  are  sel- 
^om^oTarcalibeTaralPcoiT^^^ 

Tliey~are  themselves,  as  a  rule,  working  women  unaccustomed  to 
mathematical  reasoning  and  unable  to  express,  in  a  careful  and  con- 
vincing manner,  even  the  facts  they  have  clearly  in  mind.  Knowing 
beforehand  that  something  in  the  nature  of  a  struggle  is  about  to 
take  place,  they  are  all  too  apt  either  to  capitulate  prematurely  or 
else  to  resort  to  mere  sentimental  appeals  that  lose  them  public  con- 
fidence. Above  all,  they  are  in  very  many  cases  unable  to  plead  all 
the  facts  they  know  with  even  the  vigor  and  skill  of  which  they  are 
capable,  because  they  are  afraid  of  the  ill  will  of  their  employers. 
All  our  laws,  to  be  sure,  insert  severe  penalties  for  any  such  dis- 
crimination on  the  part  of  employers  against  workers  who  testify ; 
but  indirect  discrimination  is  difficult  to  trace,  and  the  habit  of  a 
self -subordinating  frame  of  mind  is  not  easy  to  overcome. 


'?»S»f''^'* 


.:l4l 


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756       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

'  Finally,  all  three  groups  (the  employees  of  course  especially)  are 
apt"lo~t5rTyoetully  untrained  in  the  handling  of  budget  material; 
ffeqilenn>rit  is  difficult  for  them  to  grasp  the  very  concept  of  an 
average.  When  it  comes  to  drawing  up  a  supposedly  accurate 
schedule  of  necessary  expenditures,  therefore,  the  chances  are  a 
hundred  to  one  that  the  major  items  will  be  listed  in  their  most  fav- 
orable (that  is,  least  expensive)  light,  while  many  very  important 
minor  items  will  be  overlooked  entirely.  Employees  are  quite  as 
ready  as  employers  to  omit  all  such  items  from  their  calculations, 
with  the  result  that  the  budgets  to  which  they  agree  are  commonly 
several  very  important  dollars  short. ^ 

The  following  quotations  from  representatives  of  minimum-wage 
commissions  may  help  to  illustrate  some  of  the  foregoing  points : 

I .  The  bargaining  character  of  boards ;  weight  given  to  financial 
considerations : 

The  award  of  $13.20  was  really  a  compromise  between  the  employ- 
ers and  employees  who  served  on  the  conference,  the  former  having 
recommended  Si 2  and  the  latter  Si 5  ( Washington ).- 

Evidence  is  taken  at  each  of  the  conferences  on  what  the  cost  of 
living  really  is,  but,  so  far,  no  attempt  has  been  made  to  verify  or 
sift  or  tabulate.  ...  In  the  .  .  .  conference  the  employers  fought 
hard,  and  the  employees  were  obstinate,  so  the  result  was  really 
obtained  by  bargaining.  .  .  .  They  (the  employers  of  another  con- 
ference) suggested  that  $11  was  a  fair  minimum  .  .  .  and  the  em- 
ployees threw  down  their  defiance  in  the  shape  of  a  claim  that  $15 
was  necessary.  .  .  .  When  a  compromise  was  suggested  in  the 
shape  of  $13.50,  nobody  offered  the  least  objection  .  .  .  (British 
Columbia).^ 

The  function  of  the  commission  in  these  debates  is  well  summed 
up  by  the  Washington  representative : 

In  the  final  session,  with  only  members  of  the  board  present,  the 
wage  question  is  always  a  struggle  for  a  decent  living  by  the  employee 

1  Thus  questions  of  average  medical  attention,  of  average  time  lost  through 
illness  or  unavoidable  industrial  lay-off,  of  recreation,  gifts,  insurance,  dues, 
charity,  reading  matter,  vacation,  legal  holidays,  house  moving,  postage,  toilet 
supplies,  railroad  and  car  fare,  extra  food,  etc.,  are  tremendously  skimped.  The 
common  practice  is  to  lump  a  great  many  of  them  together  under  the  catch-all 
"miscellaneous,"  with  the  resultant  total  often  smaller  than  even  one  or  two  of 
its  component  parts  would  be  if  taken  alone. 

2 Letter  to  the  writer,  November  iq,  1918. 

3  Letter  to  the  writer,  December,  1918. 


AMERICAN  MINIMUM-WAGE  LAWS 


757 


and  a  struggle  to  keep  down  "overhead  cost"  by  the  employer, 
and  when  it  gets  to  the  "bargaining"  point  (which  it  always  has), 
the  Commission  should  insist  on  the  text  and  spirit  of  the  law  that 
the  "cost  of  living"  is  the  basis  on  which  to  decide  the  wage. 

2.  Weakness  in  bargaining  power  of  the  employees: 

We  consider  that  our  minimum  wage  ($8.50)  is  very  low.  How- 
ever, it  was  as  much  as  the  employers  on  our  Board  would  concede 
(Kansas). 

Our  experience  (in  19 13-19 14)  was  not  satisfactory.  We  found 
the  employers  represented  their  class  too  well,  and  they  tried  to  get 
the  minimum  as  low  as  possible,  with  no  reference  to  the  cost  of 
living.  The  rates  finally  adopted  ranged  from  $8  to  $9.  The  em- 
ployees were  lacking  in  initiative  because  of.  their  fear  of  the  em- 
ployers. One  might  be  able  to  get  better  representatives  of  employees 
in  those  communities  where  women  are  better  organized.  The  idea  of 
getting  men  employees  to  represent  women  employees  might  be 
worth  trying  .  .  .  (Minnesota). 

X.  THE  TIME   ELEMENT:   DIFFICULTIES   IN   REVISING 

RATES 

One  of  the  discouraging  things  about  minimum-rate  making  is 
that  during  a  period  of  rapidly  changing  prices,  such  as  we  have  had 
ever  since  our  first  American  wage  laws  went  into  effect,  it  takes  a 
very  short  time  for  a  rate  to  become  antiquated.^  When  that  hap>- 
pens  it  is  difficult  to  get  the  commission  to  act — to  start  afresh  on 
the  weary  round  of  investigations  and  hearings  and  orders.  The  more 
thorough  the  original  investigation  has  been,  the  more  will  it  neces- 
sarily have  cost  in  time  and  money  and  the  less  funds  and  energy 
will  there  now  be  in  the  hands  of  the  commission  to  repeat  the  process 
or  any  part  of  it.  On  the  other  hand,  if  the  original  survey  has  been 
cursory,  or  even  if  it  has  been  painstaking  but  inexact,  any  revision 
based  in  the  main  on  those  previous  findings  will  incorporate  the 
errors  of  the  former  findings. 

Of  these  two  difficulties  Minnesota  furnishes  a  good  example  of 
the  first,  Oregon  of  the  second.  In  Minnesota  the  old  19 13-19 14 
rates  of  $8-89  have  recently  been  reissued  by  the  Commission,  not 

^Take  as  an  extreme  case  the  calendar  year  191 7,  during  which  the  average 
(country-wide)  increase  in  living  costs  was  some  25  per  cent.  By  the  end  of  the 
year  a  $10  wage  would  have  been  worth  only  $8. 


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758       TR.\DE  UNIONISM  AND  LABOR  PROBLEMS 

because  anyone  supposes  that  a  woman  can  today  live  on  them,  but 
because  the  complete  new  state-wide  survey  which  the  Commission 
considers  necessary  would  take  so  long  to  finish  that  it  seemed  better 
to  have  the  old  rates  as  a  stop-gap  meanwhile.  In  Oregon  the  19 18 
rates  were  based  exclusively  on  the  rise  in  living  costs  since  the  adop- 
tion of  the  19 1 5-19 1 6  rates;  when,  as  a  matter  of  fact,  the  19 15- 
19 1 6  rates,  themselves  a  revision  of  the  19 13-19 14  ones,  had  been 
markedly  inadequate.^  By  19 19  the  lag  became  so  apparent  that  in 
August  a  fresh  state-wide  minimum  of  $13.20  was  enacted. 

In  distress  over  the  19 18  situation  of  continuous  inadequacy  and 
upheaval,  a  representative  of  the  Oregon  Commission  wrote: 

There  is  too  much  of  *a  tendency  to  fix  the  minimum  ...  at  a  bare 
existence.  ...  If  we  could  work  out  a  scientific  wage  basis  and  give 
the  Industrial  Welfare  Commission  power  to  advance  that  minimum 
each  time  the  cost  of  living  made  a  perceptible  advance,  a  lot  of  the 
machinery  which  now  must  be  used  would  be  unnecessary. 

To  believers  in  the  advantages  of  representative-wage-board  ad- 
ministration, the  concluding  suggestion  would  seem  but  a  counsel  of 
despair.  A  more  hopeful  possibility,  in  the  opinion  of  the  writer, 
would  be  to  give  the  Commission  limited  power  of  revision  in  ac- 
cordance with  the  terms  of  an  order,  say  for  a  year  after  the  order 
went  into  eftect,  at  the  end  of  which  time  the  usual  conference  ma- 
chinery would  have  to  be  resorted  to.  More  important  than  such  a 
step,  however,  would  be  the  establishment  for  the  benefit  of  all  our 
commissions  of  a  thoroughly  reliable  clearing  house  to  formulate  the 
basic  standards  themselves.  An  elaborate  federal  agency  such  as  our 
Bureau  of  Labor  Statistics  is  of  course  eminently  fitted  for  such  a 
task.  It  would  be  perfectly  feasible  for  them  to  issue  a  series  of 
detailed  and  authoritative  standards  for  self-supporting  women,  on 
a  strictly  commodity  basis,  as  they  are  at  present  engaged  in  doing 
for  families  for  the  various  large  regional  zones  in  the  country  that 

^So  far  back  as  1913  the  social-survey  committee  of  the  Oregon  Consumers' 
League,  in  a  study  which  was  at  least  more  accurate  than  anything  that  has 
succeeded  it  in  the  state,  had  set  about  $10  a  week  as  a  minimum  living  wage. 
Vet  in  191S-1Q16  the  rates  agreed  to  ranged  to  only  from  $8.56  to  $9.25.  Ap- 
plying (quite  fairly  and  scientifically)  the  34  per  cent  increase  which  the  figures 
of  the  United  States  Bureau  of  Labor  Statistics  and  other  government  agencies 
showed  at  the  beginning  of  iqi8  to  these  low  rates,  the  resultant  $ii.io-$ii.6i 
still  fell  far  short  of  a  full  living  minimum. 


AMERICAN  MINIMUM-WAGE  LAWS 


759 


have  sharply  differentiated  costs  and  customs.  These  general  stand- 
ards the  bureau  would  of  course  revise  periodically  in  accordance 
with  the  cost  of  living,  so  that  all  that  would  remain  for  the  state 
boards  and  commissions  would  be  to  make  those  purely  local  adjust- 
ments for  which  they  appear  to  be  peculiarly  fitted.  Even  if  popular 
pressure  and  the  exigency  of  business  conditions  did  drive  a  given 
rate  temporarily  well  below  the  established  commodity  minimum,  it 
would  be  with  the  immense  advantage  of  leaving  the  basic  facts  in 
the  case  undisguised  and  undisputed,  and  the  natural  burden  of  proof 
weighing  against  the  continuance  of  the  objectionable  practice. 

Pending  such  a  series  of  federal  surveys,  much  could  be  done  by 
local  commissions  in  comparing,  adapting,  and  perfecting  each  other's 
best  standards,  and  in  applying  locally  all  the  government  figures 
that  do  appear.  The  commission  secretaries,  if  adequately  paid  and 
endued  with  double  membership  on  board  and  commission,  as  has 
been  previously  suggested,  could  take  the  lead  in  this  work  of 
standardization  and  education. 

XL  THE  GROWING  SCOPE  OF  WAGE  AWARDS 

Within  the  past  six  months  a  most  remarkable  and  hopeful  develop- 
ment has  taken  place  in  the  direction  of  standardization  of  rates — 
a  standardization  within  states  and  between  neighboring  states  as 
well.  Whereas  formerly  awards  have  always  been  made  separately 
for  separate  trades  (and  often  for  different  sections  of  the  state), 
in  the  latter  half  of  1919  Wisconsin,  California,  and  Oregon  have  fol- 
lowed the  example  (then  unique)  set  by  Washington  a  year  ago,  in 
establishing  uniform  rates  for  all  industries  throughout  the  state. 
In  the  case  of  the  Pacific  group,  moreover,  these  rates  are  practically 
identical  for  all  three  states — $13.20  and  $13.50  per  forty-eight-hour 
week.  For  learners  California  and  Oregon  retain  trade  distinctions,^ 
but  for  experienced  adults  the  rates  all  read  alike.  The  significance 
of  this  new  departure  can  scarcely  be  overemphasized.  It,  more  than 
anything  else  we  have  hitherto  had  to  record,  marks  the  breakdown 
of  the  old  system  of  local  business  protection  and  the  erection  of 
living  standards  that  can  be  scientifically  impartial. 

■^This  is  quite  proper  in  view  of  the  varying  international  advantages  of 
different  trades.   See  sections  XIV  and  XV  below. 


In 


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760       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

XXL  THE  LONG  VIEW :  ACTUAL  EARNINGS  VERSUS 

HOURLY  RATE 

The  final  difficulty  attending  the  decisions  of  board  and  commis- 
sion is  that  of  equating  the  nominal-wage  rate  to  actual  income. 
Nearly  everyone  would  agree,  on  the  one  hand,  that  it  would  be 
absurd  to  pay  a  woman  deliberately  choosing  part-time  work  a  full 
week's  wage.  On  the  other  hand,  nearly  everyone  would  agree  that 
it  would  be  equally  unfair  to  pay  a  woman  engaged  for  full-time 
work,  and  required  to  be  on  the  premises  all  through  working  hours, 
for  say  only  twenty-five  hours  of  her  time,  if  slack  production,  per- 
haps in  another  part  of  the  factory,  kept  her  machine  unexpectedly 
idle  at  irregular  intervals.  But  between  these  two  extremes  there  are 
many  gradations  which  prove  most  elusive  to  handle. 

The  great  majority  of  our  commissions  have  made  no  attempt  to 
solve  the  difficulty.  They  have  frankly  adopted  the  hourly-rate 
scale  throughout  the  industries  with  which  they  have  had  to  deal, 
making  no  variation  for  chronically  part  time  or  seasonal  industries. 
That  is,  the  so-called  "weekly  wage  rate"  they  enforce  is  based  on 
the  assumption  that  all  workers  work  the  full  legal  number  of  hours 
each  week;  it  is  only  by  so  doing  that  they  are  to  be  enabled  to 
support  themselves.  If  they  work  less,  no  matter  by  whose  fault, 
they  will  receive  less  than  the  week's  minimum  income  that  has  been 
agreed  upon  as  necessary  decently  to  support  life.  Thus  Massa- 
chusetts's  order  (November,  1918)  for  the  wholesale-millinery  in- 
dustry contains  the  express  proviso:  "These  rates  ($11  for  the 
experienced  adult)  are  for  full-time  work,  by  which  is  meant  the  full 
number  of  hours  per  week  (fifty-four)  ^  required  by  employers  and 
permitted  by  the  laws  of  the  Commonwealth." ^  This  is  for  one  of 
the  most  seasonal  industries  in  existence,  where  almost  anyone  would 

1  Since  then  (1919)  the  legal  hours  of  work  in  Massachusetts  for  women  and 
minors  have  been  reduced  to  forty-eight. 

2 U.S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  VIII,  No.  2 
(1919)1  p.  195-  In  the  Arkansas  flat-rate  law  the  same  principle  is  expressed 
even  more  rigidly:  ".4//  female  workers  working  less  than  nine  hours  per  day 
shall  receive  the  same  wages  per  hour  as  those  working  nine  hours  per  day" 
(italics  mme)  ;  while  the  very  recent  state-wide  Wisconsin  order  (June,  1919) 
omits  the  mention  of  a  weekly  norm  at  all :  "  No  employer  shall  employ  any 
experienced  female  at  a  wage  rate  of  less  than  22  cents  per  hour." 


Is 


AMERICAN  MINIMUM-WAGE  LAWS 


761 


agree  it  is  impossible  to  expect  the  employee  to  find  full  supplemen- 
tary occupation  in  the  short  stretches  between  seasons.^ 

A  slightly  more  hopeful  position  is  shown  in  two  orders  of  Oregon 
and  Washington.    The  Oregon  order  (April,  1918)  reads: 

When  business  conditions  render  it  impracticable  for  an  employer 
to  furnish  to  any  employee  full-time  employment  (fifty-four  hours), 
the  employer  shall  not  be  required  to  pay  such  employee  any  greater 
sum  than  the  hourly  wage  for  the  number  of  hours  of  actual  employ- 
ment, provided  such  employer  shall  so  arrange  consecutive  hours  of 
continuous  employment  that  each  employee  may  have  a  fair  oppor- 
tunity [sic !  ]  for  securing  such  employment  as  will  enable  her  to 
earn  a  full  week's  wage. 

Washington  is  a  trifle  more  explicit  as  to  what  constitutes  "em- 
ployment," but  fails  to  specify  that  the  hours  be  consecutive.  Among 
the  1915  rulings  we  read: 

(4)  When  an  employee  is  required  to  hold  herself  at  certain  hours 
at  the  call  or  service  of  an  employer,  such  hours  shall  be  included  as 
hours  of  employment. 

(5)  .  .  .  any  arbitrary  condition  imposed  by  the  employer  which 
prevent  her  from  earning  ...  [a  living]  wage  is  contrary  to  the  in- 
tent and  spirit  of  the  law.  In  exceptional  cases,  where  business  con- 
ditions offer  less  than  full-time  employment  (eight  hours  a  day, 
forty-eight  a  week),  a  regular  schedule  of  hours  shall  be  arranged 
between  employer  and  employee  ...  [so]  that  she  may  not  be 
deprived  of  arranging  for  additional  employment  elsewhere.^ 

In  striking  contrast  to  these  half-hearted  attempts  at  amelioration 
is  the  November,  19 18,  decree  of  the  California  Commisaon.  Here 
for  the  first  time  we  have  a  recognition  of  the  principle  that  it  is  the 
employer  who  is  responsible  for  keeping  the  employee's  supply  of 
work  steady.   The  decree  reads  : 

^  The  same  provision  is  to  be  found  in  the  more  recent  decreases  for  canning 
and  candy-making,  also  seasonal  (July,  1919).  (See  Massachusetts  Minimum- 
Wage  Commission  Bulletins  18  and  19.) 

2  1.  W.  C.  Rulings,  Form  17A  (italics  mine).  The  general  War  Emergency 
Order  of  September,  1918,  adds  the  following  clauses:  "Every  .  .  .  firm  .  .  . 
offering  less  than  full-time  employment  to  female  employees  in  any  .  .  .  trade 
.  .  .  shall  post  in  a  conspicuous  place  in  the  establishment  a  proper  schedule 
of  hours  to  be  observed,  for  such  period  of  time  in  advance  as  the  Industrial 
Welfare  Commission  shall  in  its  discretion  determine,  not  later  than  noon  of 
the  preceding  day"  (I.  W.  C.  Order  No.  18,  September  10,  1918;  italics  mine). 


II 


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762       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

No  person,  firm,  or  corporation  shall  employ,  or  suffer,  or  permit 
an  experienced  woman  or  minor  to  be  employed  in  any  manufacturing 
industry  at  a  rate  of  wages  less  than  Sio  for  a  forty-eight-hour  week 
(21  cents  per  hour).  //  any  employer  docs  not  provide  the  full 
forty-eight  hours  of  employment  during  any  week,  he  must  pay  to  all 
experienced  adult  and  minor  workers  not  less  than  25  cents  per  hour 
for  the  time  worked.^ 

It  will  be  seen,  of  course^  that Jhis  Califorpi^gcheme^  a  "penalty 
differential '^e  might  call  it,  does  not  help  the:  worker  who  is  laid 
pff  for  a  Tuir week  or  more.  In  fact,  if  the  differential  were  made 
very  pronounced  it  might  well'  encourage  an  employer  in  a  seasonal 
industry  (such  as  candy,  millinery,  or  paper  boxes)  who  was  faced 
with  the  alternative  of  using  all  of  his  force  on  part  time  or  using 
only  a  portion  of  them  on  full  time,  to  choose  the  latter  and  lay  off 
as  many  as  possible  so  as  to  be  able  to  employ  the  remainder  at 
the  full-time  rate.  Employments  with  a  "peak  load"  on  certain 
days  of  the  week  would,  however,  be  materially  bettered.  Thus  the 
laundry  industr>'  could  not  longer  dock  its  employees  for  the  short 
time  provided  them  on  Mondays  and  Saturdays. 

A  more  drastic  step  in  the  same  direction  has  since  been  taken  by 
the  Minnesota  Commission.  Their  July,  19 19,  decree  establishes  a 
flat  weekly  wage  of  Si  i  "  per  week  of  forty-eight  hours  or  lessT^  The 
short-week  employer  is  thereby  penalized  by  the  full  amount  of  his 
underemployment . 

A  method  that  indirectly  attacks  the  longer-time  seasonal  industries 
has,  however,  recently  been  introduced  by  the  Wisconsin  Commission. 
Their  noteworthy  first-wage  order  (June,  1919)  provides  that  "in 
seasonal  industries  operating  only  for  a  few  months  during  the 
year  no  learning  period  is  recognized,  and  all  female  and  minor 
employees  .  .  .  shall  be  paid  ...  [the  full  experienced  adult  mini- 
mum]."^   Since  in  ordinary  establishments  lower  rates  may  be  paid 

^U.  S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  VIII,  No.  2, 
p.  192  (italics  mine).  Even  more  elaborate  provisions  are  made  in  the  Mer- 
cantile Order  of  June,  1919,  whereby  part-time  workers  receive  35  cents  an 
hour  instead  of  28. 

-  Italics  mine.  Above  forty-eight  hours  the  rate  is  no  higher,  namely,  still  23 
cents  an  hour. 

3 Industrial  Commission  of  Wisconsin,  Order  of  June  27,  1019,  sect.  4.  It 
should,  however,  be  noted  that  the  order  explicitly  omits  all  provision  for  the 
chronically    short-hour    industry.    In    section    i    of    the    "Findings    of    Fact" 


^'1^1 


AMERICAN  MINIMUM-WAGE  LAWS 


763 


IP 


to  as  many  as  25  per  cent  of  the  employees,  this  means  a  very  real 
penalty  for  the  seasonal  trade.^ 

It  would,  however,  doubtless  be  advisable  to  assess  industries  that 
are  notoriously  seasonal  even  more  directly  by  raising  their  general 
minimum  for  experienced  workers  as  well.  This,  on  a  weekly  basis, 
was  the  system  adopted  by  Australian  boards  for  the  highly  irregular 
occupation  of  dock  laborer.  "In  setting  the  minimum  hourly  rate 
.  .  .,  the  necessary  cost  of  a  week's  living  was  divided  by  the  average 
number  of  hours  of  work  obtained  weekly."- 

This  system  has  also  been  adopted  by  Massachusetts  in  a  recent 
ruling  on  office-cleaners  (January,  1919).^  This  ruling  is  in  its  way 
quite  as  remarkable  as  the  ones  quoted  from  California  and  Wiscon- 
sin. Here  the  Commission  had  found  by  previous  investigation  that 
the  average  number  of  hours  worked  per  week  at  the  occupation  was 
only  thirty-six,  and  that  four  fifths  of  the  women  worked  at  night. 
The  new  ruling  provides  a  30-cent  hourly  rate  for  night  work  and 
a  26-cent  rate  for  day  work.  On  the  basis  of  the  full  legal  fifty- 
four-hour  week,  even  the  day  rate  would  yield  1 14,  whereas  the 
budget  agreed  to  by  the  board  amounted  to  only  $11.54.  It  was 
therefore  the  typical  thirty-six-hour  worker  whose  case  was  really 
being  provided  for.  True  to  Massachusetts  tradition,  she  would  re- 
ceive somewhat  less  than  the  budget  allowed,  namely,  at  the  30-cent 
rate,  $10.80  a  week,  and  at  the  26-cent  rate,  $9.26.  These  are  not 
very  munificent  sums,  but  the  recognition  they  show  of  the  short- 
time  problem  is  extremely  important. 

However,  the  idea  suggested  by  the  California  decree,  of  making 
the  rate  directly  enforceable  upon  the  individual  employer  who  fails 
to  provide  full  work,  and  upon  him  alojte,  seems  too  good  to  lose  sight 

we  read :  "  Many  items  in  the  cost  of  living  of  female  and  minor  employees 
vary  directly  with  the  number  of  hours  they  are  required  to  work.  Those  who 
have  short  hours  of  labor  .  .  .  having  time  to  do  much  work  for  themselves 
.  .  ."  etc.  Section  i  of  the  order  proper  accordingly  reads  baldly :  "  No  em- 
ployer shall  employ  any  experienced  female  or  .  .  .  minor  ...  at  a  wage  rate 
of  less  than  22  cents  per  hour," 

1  On  the  Wisconsin  scale  it  would  amount  to  about  3  to  4  per  cent  of  the 
wages  bill. 

^New  Statesman,  June  6,  1914,  p.  263,  quoted  in  Commons  and  Andrews, 
Principles  of  Labor  Legislation,  p.  182. 

^See  U.S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  VIII, 
No.  4  (1919),  pp.  186-187. 


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764       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

of.  Perhaps  a  combination  of  both  methods  would  be  possible; 
namely,  a  slight  penalty  for  the  habitually  seasonal  or  short-time 
industry  as  a  whole  in  the  shape  of  a  higher  hourly  rate,  and  an 
additional  differential  for  the  employer  whose  work  was  unusually 
irregular.^ 

A  point  which  it  is  important  to  stress,  while  dealing  with  the 
matter  of  hourly  rates,  is  that  it  is  closely  bound  up  with  the  ques- 
tion of  the  legal  hours  of  employment  in  each  state.  The  same 
weekly  minimum  may  mean  very  different  things  to  both  employer 
and  employee  if  the  number  of  hours  for  which  it  is  being  paid  is 
different.  Thus  Oregon  in  April  of  19 18  changed  her  minimum  for 
manufactures  from  $8. 64  to  $11.61.  Meanwhile  her  neighbors, 
Washington  and  California,  were  paying  only  Sio.-  At  first  the 
employer  members  of  her  board  protested  at  this  disproportionate 
advance,  but  it  was  successfully  pointed  out  to  them  that,  since  both 
Washington  and  California  were  limited  to  a  forty-eight-hour  week, 
while  Oregon  worked  fifty-four,  the  respective  wage  rates  for  the 
three  states  would  be  rendered  practically  equal,  thus : 

Washington  and  California  .  .  $10.00  a  week  -r-  48  hours  =  21  cents  per  hour' 
Oregon $1 1. 61  a  week -=- 54  hours  =  21 J  cents  per  hour 

^This  could  be  assessed  in  some  such  way  as  the  one  originally  outlined  by 
the  chairman  of  the  first  Massachusetts  brush  board  (quoted  in  Annual  Report 
of  New  York  Factory  Investigating  Commission,  Vol.  VI  (1915),  Appendix  IV, 
p.  633):  "Each  weekly  pay  day  the  minimum  weekly  rate  set  by  this  board 
shall  be  multiplied  by  ten,  and  if  the  total  earnings  during  that  ten-week  period 
immediately  preceding  each  weekly  pay  day  do  not  equal  that  amount,  the 
difference  shall  be  paid  her  each  week."  A  simpler  method,  however,  in  the 
opinion  of  the  writer  would  be  to  assess  each  employer  at  an  hourly  rate  that 
roughly  corresponds  to  the  average  per-capita  short  time  that  he  had  pro- 
vided during  a  specified  period  in  the  recent  past.  Thus  an  employer  who 
had  averaged  20  i>er  cent  fluctuation  above  that  allowed  for  in  the  general  trade 
estimate  would  have  to  pay  a  20  per  cent  differential  on  his  minimum  hourly 
rate.  (Needless  to  say,  "short  time"  in  the  above  sense  does  not  include  time 
lost  by  the  worker's  own  fault,  i.e.,  voluntary  absenteeism.) 

2  The  California  decrees  at  this  time  did  not  cover  manufacture,  but  $10  was 
the  rate  for  stores,  etc. 

3  Incidentally  the  Oregon  members  were  made  to  realize  that  hitherto  the 
advantage  had  lain  very  heavily  on  the  other  side  and  that,  nevertheless,  their 
neighbors  had  not  been  ruined.  Up  to  this  time,  when  the  Washington  and 
California  rates  were  already  $10,  or  21  cents  per  hour,  the  Oregon  rates  for 
manufacture  had  ranged  from  $8.25  to  S8.64,  or  155^-16  cents  per  hour.  (The 
higher  rate  was  for  the  city  of  Portland.) 


'  i  I 


AMERICAN  MINIMUM-WAGE  LAWS 


765 


The  close  connection  between  hours  of  work  and  wages  per  hour 
is  doubtless  one  very  important  reason  why  so  many  of  our  states 
have  assigned  hours  as  well  as  wages  to  the  jurisdiction  of  their 
minimum-wage  ("industrial  welfare")  commissions.    Where  no  di- 
rect connection  between  the  hour-fixing  and  the  wage-fixing  machinery 
of  a  state  exists,  it  is  always  possible  to  reduce  the  hourly  wage  by 
increasing  the  number  of  hours  for  a  given  industry.    Thus  a  repre- 
sentative of  the  Washington  Commission  writes :  "  During  one  session 
of  the  Legislature  the  .  .  .  Association  .  .  .  attempted  to  secure  an 
amendment  to  the  woman's  eight-hour  law  providing  for  an  emergency 
clause  allowing  overtime.    Had  this  passed,  it  would  have  indirectly 
reduced  wages,  as  all  wages  are  based  on  an  eight-hour  day  and  six- 
day  week."  ^    And  again,    "  The  question  of  seasonal  industries,  such 
as  fish  and  fruit  canning,  do  not  come  under  the  Factory  Orders  and 
the  wage^  applies  to  them."   The  converse  of  this  connection  is  seen 
where  the  legal  hours  of  work  are  suddenly  reduced.    The  wage  per 
hour  is  automatically  raised.    Thus  Massachusetts's  adoption  (1919) 
of  a  forty-eight-hour  week  in  place  of  a  fifty-four  gives  her  women 
nearly  a  13  per  cent  hourly  increase. 

XIII.  SPECIAL  CLASS  OF  WORKERS  :  THE  DEFECTIVE 

Besides  the  difficulties  attendant  upon  the  setting  of  the  regular 
rate  for  normal  adult  women,  our  minimum-wage  commissions  have 
to  face  the  problems  of  three  special  classes  of  workers  generally 
recognized  as  substandard :  the  young,  the  inexperienced,  and  the 
defective.  Of  these  the  defective  have  thus  far  proved  much  the 
easiest  to  deal  with. 

In  all  our  states  save  Massachusetts,  Wisconsin,  and  Kansas  the 
class  is  narrowed  to  include  only  adult  women  who  are  physically 
defective.^  The  method  of  handling  these  cases  is  always  by  individ- 
ual license,  issuable  by  the  commission  direct.  The  wage  boards 
naturally  have  nothing  to  do  with  them.    Each  license  sets  a  special 

1  Letter  to  the  writer,  October  26,  1918. 

2 I.e.  the  rate  per  hour.  This  gives  a  higher  weekly  wage  to  these  long- 
hour  industries. 

3 In  Wisconsin,  however,  it  applies  to  "any  female  or  minor  unable  to  earn 
the  living  wage,"  and  in  Massachusetts  and  Kansas  to  "  any  employee  ...  of 
less  than  ordinary  ability.  ..."  • 


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766       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

substandard  rate  for  the  worker  concerned,  which  may  be  temporary 
or  permanent  according  to  the  nature  of  the  defect  and  the  wording 
of  the  law.  Some  laws  limit  the  proportion  of  defectives  that  may  be 
employed  in  any  one  establishment  to  one  in  ten. 

So  far  the  total  number  of  licenses  issued  by  the  active  minimum- 
wage  states  has  been  surprisingly  small.  As  one  secretary  writes, 
"Employers  evidently  do  not  want  to  ask  for  defectives'  permits 
unless  there  is  no  question  about  the  employee's  being  unable  to  make 
a  living  because  of  .  .  .  her  defect."  Washington  reports  only  fifty 
in  five  years  of  commission  activity.  The  California  Commission 
states  in  respect  to  the  laundry  industry,  where  infirm  workers  are 
more  easily  accommodated  than  elsewhere:  "No  license  has  been 
granted  to  any  woman  except  upon  the  signed  statement  of  a  licensed 
physician  that  the  applicant  was  not  able  to  work  to  normal  capac- 
ity at  ordinary  tasks,  either  because  of  age  or  physical  disability. 
Even  then  no  license  is  granted  for  less  than  $8.  .  .  .  In  No- 
vember, 19 1 8,  less  than  3  per  cent  of  the  total  employees  .  .  . 
[held]  such  permits."^ 

None  of  these  states  report  any  difficulty  because  of  applications 
from  the  mentally  defective.  In  many  cases,  of  course,  the  mentally 
defective  would  also  be  physically  handicapped  and  thus  receive 
their  classification  without  question.  Of  the  six  licenses  thus  far 
issued  by  the  Minnesota  Commission  three  were  for  women  thus 
doubly  handicapped.  Our  informant  states  that  no  case  of  purely 
mental  defect  has  as  yet  arisen.  The  Washington  Commission 
reports  similarly,  "We  have  had  no  application  from  a  mentally 
subnormal  person." 

In  view  of  the  large  number  of  mental  defectives  known  to  be  at 
large  in  our  population,  this  state  of  affairs  is  certainly  surprising. 
Perhaps  the  majority  of  them  find  their  way  into  simple  piecework 
operations  where  their  reduced  output  can  affect  no  one  but  them- 
selves.2  Others  doubtless  drift  about  from  job  to  job,  never  making 
themselves  valuable  enough  to  an  employer  to  cause  him  even  to  try 

1  Third  Biennial  Report,  I.  W.  C.  of  California,  p    70 

2  However,  in  a  state  like  California  they  would  probably  be  discovered  even 
there  if  large  numbers  congregated  in  any  one  branch  of  piecework,  for 
Cahfornia  has  he  provision  m  her  ruling  on  manufactures  that  66  f  per  cent 
of  all  pieceworkers  employed  by  any  one  establishment  must  earn  over  the 
weekly  rate  (LW.C.  Order  No.  11,  amended  1919,  sect.  8,  (d)) 


AMERICAN  MINIMUM-WAGE  LAWS 


767 


for  a  license  for  them.  But  a  large  remainder  appear  to  be  still  un- 
accounted for.  Can  it  be  that  much  of  our  industry  is  so  simplified 
and  routinized  that  even  a  moron  is  good  enough  to  support  herself 
at  it  ?  Nay,  possibly  that  she  may  in  some  respects  be  preferable  to 
her  normal  and  therefore  more  restless  sister  ? 

In  the  future  without  doubt  the  problem  of  the  defective  will  grow 
more  acute,  as  minimum-wage  legislation  is  extended  to  our  more 
thickly  settled  industrial  states  and  as  the  minimums  in  our  existing 
rulings  are  raised  to  something  nearer  a  full  living  wage.  A  clear 
understanding  of  the  ground  of  licensing  would  then  be  imperative. 
The  Massachusetts- Kansas-Wisconsin  system  of  "wide  open"  licenses 
would  doubtless  offer  increasing  dangers,  while  a  definition  that 
strictly  excluded  all  but  the  physically  incapacitated  would  doubtless 
err  equally  on  the  other  side. 

As  the  number  of  licenses  grows,  opportunities  for  constructive 
social  work  on  the  part  of  the  commissions  should  grow  also.  They 
can  become  the  logical  centralizing  agency,  the  clearing  house,  for 
putting  adult  women  defectives  in  touch  with  other  appropriate 
agencies.  The  system  of  renewable  licenses  will  enable  them  to  keep 
track  of  the  progress  of  each  case,  while  threat  of  forfeiture  gives 
them  unusual  persuasive  power. 

XIV.  MINORS  AND  APPRENTICES 

The  problem  of  the  untrained  and  the  immature  worker  is  far 
more  puzzling.  How  long  does  it  take  a  woman  to  learn  a  trade? 
(What  trade?)  How  much  longer  does  it  take  her  if  she  is  not  a 
woman  but  a  young  girl?  (In  which  trades  does  age  count  for 
most?)  Are  there  any  trades  in  which  an  experienced  girl  under 
eighteen  is  as  useful  as  if  she  were  grown  ?  What  is  a  trade  anyway  ? 
How  far  shall  one  go  in  subdividing  our  complicated  industry  to  tell 
when  a  woman  who  is  changing  her  position  must  begin  at  an  appren- 
tice wage  over  again?  These  are  some  of  the  questions  that  have 
gradually  been  brought  home  to  our  commissions  in  the  course  of 
their  operations. 

The  method  of  administering  the  problem  is  unfortunately  some- 
what complicated.  In  most  of  our  laws  it  is  provided  that  both  these 
classes  of  workers  shall  receive  special  rates,  but  that,  while  the  rate 


II 


II 


ii 


768      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

for  minors  shall  be  fixed  by  the  commission  direct,  that  for  adult 
learners  shall  be  reached  by  the  usual  board  machinery/  It  may 
well  be  that  some  of  the  planlessness  of  which  we  shall  hereafter  have 
cause  to  complain  is  due  to  this  divided  responsibility.  On  the  face 
of  it  the  two  problems  are  so  closely  related  that  it  seems  only  reason- 
able to  have  the  same  agency  responsible  for  both.  That  agency,  in 
view  of  the  extreme  complexity  of  the  subject,  would  naturally  be 
the  central  commission.  However,  the  technical  trade  advice  of  the 
lower  boards  could  be  made  extremely  valuable  to  the  commission, 
provided  it  were  not  made  finally  binding. 

The  Oregon  apprenticeship  rulings  show  very  interestingly  how 
one  commission,  or,  if  you  will,  one  group  of  boards,  has  gradually 
been  awakening  to  the  complexity  of  its  task.  In  the  1913  ap- 
prenticeship conferences  Oregon  merely  issued  a  flat-rate  minimum 
of  $6  per  fifty-four-hour  week  for  all  industries,  '*and  the  maximum 
length  of  time  such  workers  shall  be  considered  inexperienced  in  any 
one  industry  shall  ...  be  ...  one  year."=^  Here  we  have  no  at- 
tempt to  define  what  is  to  be  considered  "one  industry"  and  no 
distinction  between  apprentices  who  are  brand-new  and  those  who 
are  almost  completely  experienced.  Moreover,  the  learning  period 
Itself  is  extremely  long.  If  such  length  had  any  justification  at  all 
one  would  suppose  it  could  only  be  on  the  ground  of  acquainting  the 
learner  with  a  good  many  branches  of  a  rather  difficult  trade 

The  commissioners  themselves,  however,  apparentlv  had  no  clear 
Idea  on  the  subject,  for  they  seem  to  have  done  nothing  to  prevent 
employers  from  taking  advantage  of  the  loose  wording  of  the  ruling 
By  1916  such  grave  abuses  had  sprung  up  that  the  new  conference 
then  m  session  was  instructed  to  consider  a  refinement  of  terms 
Some  employers  dismissed  girls  as  soon  as  the  first  year  had  ex- 
pired or  shifted  them  to  slightly  new  work  in  different  departments, 

finrZ'  h?  ""^  ^"^u    '''*'''  ^^"f^'-"^^  ^"d  Washington,  make  no  express  di.-' 
Unction   between   the   wages   to   be   paid   the   skilled    and    the    unskilled;    and 
California  makes  no  distinction  between  minors  and  adults.    Both  these  state<; 
however,  empower  the  commission  to  issue  individual  apprenticeship  licenses.' 
m  practice  this  provision  appears  to  have  made  for  greater  flexibilitv  of  rul- 

iTs  w  k"'  ^r^"""'  ^^^^  ^"  ^''  ^^"e'-al  War  Emergency  Order  of  November, 
1918,  Washington  chose  to  ignore  all  differences  of  skill -the  flat  rate  of  $13  20 
bemg  supposed  to  apply  to  all  women  and  the  $q  to  all  minor.  ) 

^Quoted  in  "The  Oregon  Minimum  Wage  Law"  (Reed  CoUege  A.  B.  thesis) 
by  Samuel  B.  Weinstein,  p.  21  (italics  mine). 


^l 


AMERICAN  MINIMUM-WAGE  LAWS 


769 


thus  starting  them  on  a  second  year  of  apprenticeship  at  $1  a  day."^ 
It  apparently  never  occurred  to  the  conference  to  go  so  far  as  to  re- 
quire the  new  employer  to  pay  the  girl  what  she  had  last  been  receiv- 
ing or  to  force  the  old  employer  to  increase  the  girl's  wage  at  the 
expiration  of  a  year  of  any  sort  of  service  with  him.  Instead,  they 
tried  the  method  of  inducements :  they  adopted  a  rising  scale,  begin- 
ning at  $6  as  before,  but  increasing  $1  every  four  months,  so  that  by 
the  end  of  the  year  the  apprentice  would  be  receiving  very  nearly  the 
full  adult  minimum  and  the  temptation  to  dismiss  her  would  be  very 
much  reduced.  This  device  of  the  graduated  scale  is  now  in  use  by 
practically  all  our  commission  states.-  It  operates  as  an  incentive  to  the 
employee  to  stick  to  her  job  as  well  as  to  the  employer  to  retain  her. 

By  19 1 8  Oregon  had  decided  to  attempt  a  refinement  of  the 
graduated  scale.  When  it  came  to  raising  the  general  level  of  wage 
rulings  in  accordance  with  war  prices,  the  mercantile  conference 
decided  to  abandon  the  policy  of  fixed  three-month  periods  and  to 
substitute  irregular  periods,  the  first  very  much  shorter  than  the 
others,  to  encourage  the  new  hand  to  overcome  the  inertia  of  the 
first  few  weeks ;  moreover,  they  decided  to  shorten  the  total  ap- 
prenticeship term  for  their  industry  from  a  year  to  eight  months.^ 

All  the  Oregon  19 18  conferences  finally  realized  the  necessity  of 
meeting  squarely  the  abuse  of  shifting  girls  about  from  one  depart- 
ment to  another.  They  accordingly  had  the  Commission  issue  the 
following  ruling : 

After  any  woman  shall  have  completed  any  prescribed  period  of 
service  as  an  apprentice,  she  shall  not  thereafter,  while  working  for 
the  same  employer,  be  paid  a  wage  less  than  that  prescribed  for  the 
next  succeeding  period,  unless  a  permit  therefor  shall  be  issued  by 
the  Industrial  Welfare  Commission.* 

1  Quoted  in  "The  Oregon  Minimum  Wage  Law"  (Reed  College  A.  B.  thesis) 
by  Samuel  B.  Weinstein,  p.  31- 

2  California  in  her  latest  order  (No.  5,  amended  June,  1919)  adds  the  express 
warning,  "Learners'  permits  will  be  withheld  by  the  Commission  where  .  .  . 
firms  .  .  .  make  a  practice  of  dismissing  learners  when  they  reach  their 
promotional  periods." 

3  This  system  has  been  perpetuated  under  the  new  iqiq  rulings.  The  mer- 
cantile scale  now  runs:  first  month,  $q  per  forty-eight-hour  week;  next  three 
months,  $10.50;  last  four  months,  $12;  full  adult  wage,  $13.20.  A  somewhat 
similar  system  had  previously  been  in  force  in  Washington  for  the  laundry  and 
telephone  industries.     (Oregon  I.  W.  C.  Order  No.  37,  August  12,  1918,  sect.  3.) 

*I.W.C.  Order  No.  36,  April  12,  1918,  sect.  5  (italics  mine). 


t\ 


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770      TRADE  UNIONISM  AND  LABOR  PROBLEMS 

So  far  Oregon  has  not  issued  any  ruling  to  prohibit  a  new  em- 
ployer from  engaging  a  partly  experienced  girl  at  a  beginner's  wage. 
Discussion  at  present  centers  about  the  question  of  how  greatly 
variations  in  individual  firm  methods  justify  at  least  a  short  initial 
term  of  fresh  apprenticeship/  Wisconsin  and  Arkansas  alone  have 
faced  the  issue  unequivocally.  The  Arkansas  flat-rate  law  (1915) 
states,  "All  time  served  as  inexperienced  workers  or  apprentices 
shall  be  cumulative";  while  the  Wisconsin  Commission's  first-wage 
order  (June,  1919)  reads,  "Employees  shall  be  deemed  experienced 
after  six  months  of  employment  in  the  trade  or  industry,  whether  for 
the  same  employer  or  different  employers."- 

In  general  it  may  safely  be  said  that  the  problems  of  apprentice- 
ship have  not  received  the  thorough  and  dispassionate  study  which 
they  demand ;  that,  in  fact,  they  have  been  slighted  as  compared 
with  the  problems  of  the  experienced  worker.  Very  probably  the 
chief  fault  lies  in  a  lack  of  vital  interest  on  the  part  of  the  employees' 
representatives, —  their  own  apprenticeship  period  lying  so  very  far 
in  the  background  of  their  memory,— combined  with  a  lack  of  in- 
timate knowledge  of  trade  processes  on  the  part  of  the  representatives 
of  the  public,  and  a  natural  desire  on  the  part  of  the  employers  to 
"get  a  bit  of  their  own  back"  where  they  find  least  opposition  to  it. 
Unquestionably  the  great  majority  of  our  apprenticeship  periods  have 
been  too  long,  the  wages  too  low,  the  instruction  indifferent,  and  the 
opportunity  for  abuses  in  the  way  of  repetition  of  half-completed 
periods  too  little  guarded  against.^ 

It  would  take  a  very  thorough  revamping  of  our  present  industrial 
methods  to  give  inexperienced  women  the  most  rapid  and  thorough 
training  of  which  they  are  capable ;  but  surely  the  process  could  be 
greatly  speeded  up  by  the  mere  mechanical  shortening  of  the  learning 

^Some  commissions  take  the  mild  precaution  of  requiring  the  old  employer 
at  any  time  to  furnish  the  apprentice  upon  request  with  a  certificate  showing 
the  length  of  her  service  with  him.  Arkansas  contains  this  provision  in  her 
statute. 

2I.W.  C.  Order  of  June  27,  1919,  sect.  4. 

3  One  abuse  very  commonly  guarded  against  is  the  employment  of  a  dis- 
proportionate number  of  apprentices  in  any  one  establishment.  Thus  the  new 
California  rulings  for  .  .  .  stores  and  factories  provide  that:  "The  total  num- 
ber of  learners  .  .  .  (adult  and  minor  combined)  shall  not  exceed  33!^  per 
cent  of  the  total  number  of  [workers]  employed"  (sect.  3).  See  I.  W.  C. 
Orders  5  and  11,  amended  1919,  sect,  i,  (c). 


AMERICAN  MINIMUM-WAGE  LAWS 


771 


period,  forcing  the  employer  to  concentrate  whatever  training  he 
did  propose  to  give  into  a  shorter  time,  and  protecting  him,  with 
low  initial  wages  but  a  rapidly  rising  scale,  on  the  one  hand  from 
the  temptation  of  discharging  the  partially  trained,  and  on  the  other 
from  the  inclination  of  the  partially  trained  themselves  to  wander 
off  and  seek  a  fresh  trade. 

The  extent  to  which  the  length  of  the  apprenticeship  period  may 
be  a  matter  of  local  custom — or  rather  of  local  inertia — is  shown 
by  a  comparison  of  three  recent  laundry  awards  of  Massachusetts 
and  Arkansas.  In  Massachusetts  all  apprenticeship  periods  are  ex- 
tremely long  (probably  yet  another  reflection  upon  her  system  of 
nonenforceable  awards),  ranging  from  one  to  a  full  two  years.^  Her 
laundry  award  whereby  workers  are  "held  experienced  after  one  year, 
if  absences  have  not  been  of  unreasonable  duration,"  is  therefore  by 
no  means  exceptional.^  In  Arkansas,  by  the  19 15  flat-rate  statute, 
the  apprenticeship  period  for  all  trades  (laundries  therefore  included) 
was  set  at  six  months,  just  half  that  of  Massachusetts.  Yet  when  in 
the  summer  of  19 18  the  National  War  Labor  Board  came  into  that 
state  to  settle  the  laundry  difficulties  in  Little  Rock,  it  not  only  raised 
the  whole  wage  scale  tremendously  but  promptly  reduced  the  six- 
month  period  to  thirty  days.^  Here  we  have  a  variation  in  three 
typical  rulings  of  1200  per  cent.*    Which  of  the  three  was  right  ?^ 

^See  table,  "Minimum  Wage  Regulations  for  Women,  January  i,  1917,"  in 
Oregon  Minimum  W^age  Brief,  p.  76. 

2 Thus  millinery  (December,  1918)  requires  two  years,  candy-making  (July, 
1919)  a  year  and  a  half,  and  even  canning  (July,  1919)  a  year  !  Contrast  with 
this  last  the  recent  Wisconsin  decree :  "  In  seasonal  industries  operating  only 
for  a  few  months  during  the  year  no  learning  period  is  recognized,  and  all 
female  and  minor  employees  .  .  .  shall  be  paid  .  .  .  [the  full  experienced-adult 
wage]"  (Minimum  Wage  Order  No.  i,  June  27,  1919,  sect.  4). 

3 National  War  Labor  Board,  Docket  No.  233,  Joint  Report  of  Section  In 
re  Employees  vs.  Laundry  Owners,  Little  Rock,  Arkansas. 

*An  almost  equally  striking  variation  is  found  in  the  laundry  rulings  (prior 
to  September,  191 8)  of  the  three  Pacific  coast  states,  where  conditions  of  work 
might  be  considered  more  closely  equivalent  and  where  no  outside  agency  has 
interfered.  In  Oregon  the  period  was  one  year  ;  in  California,  fifteen  months  ; 
and  in  Washington,  two  months  !  The  California  period  has  now  been  reduced 
to  six  months,  while  Washmgton's  191 8  rulings  recognize  no  learning  period 
at  all. 

5  The  arguments  for  short-time  training  are  certainly  borne  out  by  the  ex- 
perience of  the  U.  S.  Shipping  Board,  which  during  1918  carried  on  appren- 
ticeship courses  for  all  the  various  difficult  shipyard  trades.   The  learners,  who 


i 


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^.     *ff 


f  • 


772       TFL4DE  UNIONISM  AND  LABOR  PROBLEMS 


XV.   SOME  SPECIAL  PROBLEMS  OF  MINORS 

For  the  workers  under  eighteen  the  difficulty  of  securing  adequate 
training  in  the  shortest  possible  time  is  complicated  by  the  desirabil- 
ity of  keeping  the  younger  of  them  out  of  industry  altogether.  A 
high  initial  wage,  it  may  cogently  be  argued,  directly  encourages  the 
small  boy  or  girl  of  fourteen  to  leave  school  and  go  to  work.  On  the 
other  hand,  a  very  low  initial  wage  encourages  the  employer  to  seek 
out  all  the  immature  help  he  can.  Which  is  stronger,  the  induce- 
ment to  the  child  and  its  parents  or  the  inducement  to  the  employer  ? 

Most  of  our  commissions  have  taken  a  middle  ground,  apparently 
assuming  that  while  it  is  their  primary  duty  to  protect  the  child  from 
crass  wage  exploitation,  they  need  not  scale  up  his  wages  too  meticu- 
lously in  accordance  with  his  probable  productivity.  Thus  Oregon's 
19 19  orders  assigned  all  minors  between  fourteen  and  fifteen  a  flat 
rate  of  $6,  those  between  fifteen  and  sixteen,  $7.20.^  In  Washington, 
for  two  years  previously,  the  flat  rate  for  all  under  sixteen  was  S6.^ 
In  their  war-time  emergency  conference  the  Washington  Commission, 
however,  appears  to  have  swung  over  to  the  full-productivity  idea : 
its  minimum  for  all  minors  is  now  $g,  with  a  dollar  increase  every 
six  months  of  employment.^  In  British  Columbia  the  Commission  has 
taken  the  commendable  stand  of  trying  to  keep  the  girl  under  sixteen 
out  of  industry  altogether  by  "preventing,  except  under  special 
license,  the  employment  of  such  girls  "  and  by  "  collaborating  with  the 
educational  authorities  to  raise  the  age  for  leaving  school  [and]  .  .  . 
to  provide  more  satisfactory  methods  for  industrial  .  .  .  education."* 

For  minors  over  sixteen  there  seems  no  good  reason  to  prolong 
the  low-wage  period  beyond  what  is  absolutely  necessary  by  reason 

"were  drawn  principally  from  unskilled  shipyard  work  and  from  manufactur- 
ing," were  after  their  training  able  in  the  main  to  hold  their  own  with  ex- 
perienced journeymen.  Yet  "statistics  from  twenty-one  yards  indicate  that 
the  average  training  period  jor  all  men  was  nineteen  days.''  (See  P.  H.  Doug- 
las and  F.  E.  Wolfe,  "  Labor  Administration  in  the  Shipbuilding  Industry  during 
the  War,"  Journal  of  Political  Economy,  May,  1919,  pp.  378-379.) 

1  Oregon  I.  W.  C.  Order  No.  46,  August  12,  1919. 

2  Washington  I.  W.  C.  Order,  September  14,  191 7. 

3 I.e.  until  the  adult  minimum  of  $13.20  is  reached. 

*  Letter  to  the  writer  by  a  close  associate  of  the  Commission,  January  17, 
1919. 


\H 


AMERICAN  MINIMUM-WAGE  LAWS 


773 


of  lack  of  skill.    All  our  commissions  now  arrange  a  rising  apprentice 
scale  for  these  workers,  but  in  most  states  the  rise  is  unduly  slow. 
Thus  in  Oregon,  while  the  initial  wage  for  minors  over  sixteen  is 
nearly  as  high  as  that  for  women  learners  (viz.  $8.50  instead  of  $9), 
the  subsequent  advance  toward  the  full  minimum  takes  three  times 
as  long.    "  For  the  purpose  of  determining  a  rising  scale  for  minor 
apprentices  the  working  time  of  female  minors  between  sixteen  and 
eighteen  years  shall  be  divided  into  periods  of  three  months  each. 
Each  period  .  .  .  shall  be  considered  the  equivalent  of  one  month 
in  the  corresponding  period  of   the  apprenticeship   of    the   adult 
worker."^    There  are  no  exceptions  to  this  rule.    Consequently  no 
girl  under  eighteen,  however  proficient  she  may  be  and  however  long 
her  trade  experience  (it  may  be  almost  four  years),  can  ever  com- 
mand the  adult  minimum.    IMinors  over  sixteen  who  are  not  appren- 
tices also  begin  at  $8.50  and  are  advanced  50  cents  every  six  months. 
In  Massachusetts  the  rise  is  even  slower.    There  in  the  retail-store 
industry  no  girl,  however  experienced,  can  command  more  than  an 
apprentice  wage  until  she  is  over  nineteen  ;  while  in  women's  clothing 
factories  she  must  be  nineteen  and  a  half. 

In  California,  on  the  other  hand,  mere  immaturity  as  such  is  not 
allowed  to  affect  the  status  of  a  worker  once  she  is  partially  ex- 
perienced. Here  in  the  laundry  and  hotel  and  restaurant  industries 
the  girl  of  from  fourteen  to  eighteen  starts  on  an  exact  par  with  her 
adult  sister ;  in  stores,  factories,  and  offices  she  starts  at  a  dollar 
lower  wage,  but  after  a  given  initial  period  continues  on  through 
the  regular  stages  of  adult  apprenticeship  at  adult  wages ;  only  in 
"unskilled  and  unclassified"  occupations  does  she  remain  perma- 
nently below  adult  par.^ 

In  Wisconsin  the  exceptionally  proficient  minor  is  safeguarded  by 
the  provision :  ''  Permit  children  producing  the  same  output  as  em- 
ployees in  a  higher  wage  classification  shall  be  paid  not  less  than  the 
minimum  wage  rate  for  such  class."  ^ 

1 1.  W.  C.  Order  No.  46,  sect.  2. 

2  For  three  weeks  she  receives  |8  instead  of  the  adult's  $10,  and  thereafter 
$10  instead  of  the  adult's  $1350. 
3 In  Order  of  June  27,  1919,  sect.  3. 


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■  rt'. 

1? 

i 


774       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

CONCLUSION 

In  summing  up  this  review  of  American  minimum-wage  admin- 
istration, it  may  be  well  to  group  our  recommendations  for  the  future 
under  three  definite  heads :  first,  the  need  for  a  real  living  standard  ; 
second,  the  need  for  a  more  flexible  standard ;  third,  the  need  for 
centralization  of  administrative  responsibility. 

I.  A  Real  Living  Standard 

I.  First  and  foremost  among  our  needs  is  undoubtedly  that  of  a 
clear,  unequivocaUba^  standard  of  living  for  the  working  woman, 
a  standard  that  shall  take  account  ot  the  whole  range  of  her  neces- 
sities,  not  only  day  by  day  but  year  by  year/  For  this  we  should 
have  a  standard  budget,  formulated  preferably  by  our  federal  Bureau 
of  Labor  Statistics,  revised  by  them  periodically  in  accordance  with 
changes  in  the  cost  of  living,  and  adjustable  by  local  boards  and 
commissions  to  local  conditions. 

2-  To  reducejhis  budget  to  terms  of  iveckly  wage  rate  we  must 
have  (a)  a  clear-cul:  policy  on  the  part  of  boards  and  commissions 
that  the^Miving  wage"  shall  mean  a  "living  jncomfi-'^.  the  year  round  ; 
(^)  morej£curate Jnformation  by  these  bodies  as  to  local  irregu- 
larities of  employmenTfXcy^  simple  method  of  advancing  hourly 
rates  by  "irregularity  differentials^^henever  trades  or  individual 
establishments  fail  to  provide  full-timTwor 

3.  A  necessary  corollary  to  such  a  full  living  standard  would  be 
the  extension  of  our  special  provisions  for  substandard  workers. 
^^^  ^-Lf!.^^^^^^^^^'  ^^°  would  now  of  course  include  the  mentally 
incapable,  "niTdouble  system  of  individual  licensing  plus  limitation 
of  numbers  in  any  one  establishment  might  well  be  revised  to  include 
a  third  element,  namely,  the  selection  of  a  series  of  especially  "ap- 
proved" occupations  in  which  such  workers  could  be  allowed  to 
congregate  without  limit;  each  plant  in  the  "approved"  list  being 
subject  to  special  supervision  by  the  commission— all  defective 
workers,  meanwhile,  whether  working  in  an  "approved"  establish- 
ment or  at  large,  to  be  inspected  and  relicensed  periodically,    (b)  For 

1  For  a  detailed  discussion  of  the  components  of  such  a  standard  see  D.  W. 
Douglas,  "  The  Standard  of  Living  for  Working  Women  :  a  Criticism  of  Current 
Theories,"  Quarterly  Journal  of  Economics,  February,  1920. 


\      \ 


AMERICAN  MINIMUM-WAGE  LAWS 


775 


inexperienced  workers  and  minors  we  need  a  more  scientific  series 
(^^state'-wide  ^'rotk-boTTcm^  minimums,  graded  according  'to'  age ; 
and  above~these  a  series  of  specially  adjusted  apprentice  mini- 
mums  that  should  be  as  varied  as  the  trades  they  represent.  That  is, 
it  should  be  left  to  the  discretion  of  the  commission  and  boards 
whether  for  a  given  trade  there  should  be  any  distinction  at  all  be- 
tween the  comparatively  new  and  the  old  hand  or  between  the  youth- 
ful and  the  adult ;  and  if  there  should,  just  what  ought  to  be  their 
relative  rates  of  advance.  The  number  of  apprentices  allowed  in  any 
one  establishment  should  doubtless  continue  to  be  limited. 

II.  A  Flexible  Standard 

Next  only  to  the  need  for  a  standard  that  shall  be  adequate  at  the 
outset  is  the  need  for  a  greater  flexibility  in  its  application.  I  have 
already  pointed  out  the  need  for  (i)  more  rapkijevision  of  estiib- 


en  price  chani 

tTiat  for  specified  periods  of  a  year  or  so  the  commissions  be  given 
ad  interim  power  to  revise  existing  rates.  They  could  readily 
do  this  in  accordance  with  the  cost-of-living  index  numbers  which 
the  Bureau  of  Labor  Statistics  could  furnish  them.  Two  other 
devices  for  increasing  flexibility  are,  however,  no  less  important. 
These  are  ( 2 )  the  forestalling  of  bad  wagej:onditions  that  are  as  yet 
only  apprehended,  by  empowermg""tHe  commission  to  issue  rulings 
for  trades  jhat  may  aFtHe  time^stTll  be  oh  a  living  basis  ;  and  (jLl^ie 
easing  off  of  radical  advances  for  the  employer  b}^  permitting 
the  commission  under  exceptional  circumstances  to  distribute  the 
scheduled  advance  in  wages  over  a  specified  period.  Reform  number 
three  is  a  refinement  over  the  method  now  in  force  in  Washington 
(where  the  application  of  the  whole  rate  as  such  may  be  postponed), 
and  is  to  be  found  in  its  present  form  in  the  excellent  new  British 
Trades  Board  Act  of  1918.^ 

1  It  was  also  used,  although  without  express  legal  provision,  by  the  original 
Massachusetts  Brush  Makers'  Wage  Board  in  1914: — "The  rate  to  go  into  effect 
at  once  shall  be  15^2  cents  an  hour.  At  the  end  of  a  year's  time  the  rate  shall 
automatically  become  18  cents.  .  .  ."  (Second  Annual  Report  of  the  Minimum 
Wage  Commission  of  Massachusetts,  p.  9).  Ordinarily  Massachusetts  follows 
the  Washington  method.  Thus  the  candy  decree  of  last  July  does  not  go  into 
effect  until  January. 


I'f; 


!l 


Hi 


776       TR.\DE  UNIONISM  AND  LABOR  PROBLEMS 

Number  two  occurs  in  the  revised  British  statute  alone.^  Both 
these  innovations  are  of  great  significance ;  the  anticipation  of  low 
wages  is  especially  valuable  in  a  time  of  sudden  oversupply  of  labor 
such  as  has  occurred  in  many  industries  since  the  close  of  the  war, 
while  the  gradual  application  of  certain  rates  is  sure  to  become  a 
practical  necessity  as  the  living-wage  idea  becomes  more  firmly  estab- 
lished and  radical  advances  grow  more  common.  Where  some  com- 
promise with  purely  financial  considerations  appears  inevitable,  this 
form  is  infinitely  preferable  to  the  current  one  (of  setting  up  a  final 
rate  that  is  substandard),  since  this  proposed  device  is  self -remedying 
and  deceives  no  one. 

III.  Centralization  of  Administrative  Responsibility 

Finally  we  need  a  grpatpr  f^^nrpntration  of  power  and  of  the  respon- 
sibility that  goes  with  it  if  our  commissions  areTo~opeFaTe  effectively 
in  the  larger  industrial  states.  The  writer  has  already  pointed  out 
the  advantages  that  accrue  from  (i)  empowering  the  commission 
upon  occasion  to  overrule  the  advice  oj  the  boards  and  (2)  giving 
the  executive  officer  of  the  commission  a  voting  membership  on  both 
the  boards  and  the  commission  itself.  The  combination  of  these  two 
devices  should  go  far  toward  helping  to  organize  the  information  at 
the  commission's  disposal  and  bringing  it  to  bear  impartially  upon  the 
formation  of  a  consistent  policy. 

3.  A  more  radical  change  in  organization  that  might  prove  very  ad- 
vantageous in  our  larger  states  would  be  to^ace  the  whole  minimum- 
wage  commission  under  the  charge  of  the  existing  Department  of 
Labor,  making  of  it  an  independent  bureau  with  a  special  Deputy 
Commissioner  of  Labor  at  its  head.  He  would  then  become  the 
paid  executive  officer  of  the  commission,  taking  over  the  repre- 
sentative duties  we  were  just  now  assigning  to  the  secretary.    This 

1 U.  S.  Bureau  of  Labor  Statistics,  Monthly  Labor  Review,  Vol.  VII,  No.  5, 
1Q18,  paraphrases  and  comments  upon  these  two  provisions  as  follows:  "The 
new  act  permits  the  Minister  of  Labor  to  apply  its  provisions  to  any  trade  in 
which  it  appears  to  him  that  no  adequate  machiner>'  exists  for  the  effective 
regulation  of  wages.  It  is  thus  possible  to  forestall  an  apprehended  fall  in 
wages  in  view  of  changes  or  anticipated  changes  in  conditions  of  employment. 
.  .  .  Rates  may  also  be  fixed  to  come  into  operation  successively  on  the  ex- 
piration of  specified  periods,  and  variations  in  rates  may  be  declared  operative 
only  during  specified  periods." 


AMERICAN  MINIMUM-WAGE  LAWS 


777 


system  would  have  the  advantage  of  placing  freely  at  the  commis- 
sion's disposal  all  the  information  that  could  be  gathered  by  the 
department,^  as  well  as  its  full  power  of  inspection  and  enforcement, 
without  giving  up  the  commission's  local  autonomy .^  Its  possible 
disadvantage  would  be  the  transfer  to  the  commission  of  any  ineffi- 
ciency that  lurked  in  the  department. 

4  A  most  significant  centralization  in  administrative  methods 
(as  dislmcrmnrorganization)  thiFilready  has  taken  place  in  four 
of  our  states  is  the  wideningjn^XQPfi^JJsage  awards.  As  has  been 
pointed  out,  the  fixing  of  state-wide  adult  rates,  combined  with  care- 
fully specialized  trade  provisions  for  the  inexperienced,  marks  the 
opening  of  a  new  era  in  scientific  standards. 

5.  A  useful  precursor  to  such  standardization  would  be  theregular 
holding  of  re"i-*^-l  cpniprenrP.,  for  groups  of  states  that  "Ta^e  the 
same  economic  problems.    Such  a  conference  was  held  tentatively 
aJailFiTBTi^iry  bS^???^^^    three  Pacific  coast  states  at  the  invita- 
tion of  the  Washington  Commission,  just  before  that  body  called 
together  its  own  war-emergency  conference.   It  is  highly  probable 
that  it  was  influential  in  the  subsequent  raising  of  the  California 
and  Oregon  rates  to  the  uniform  Washington  level.    Similarly,  when 
once  the^perennially  reintroduced  New  York  and  Pennsylvania  bills 
become  law,  a  North  Atlantic  conference  between  these  states  and 
Massachusetts  (and  perhaps  by  that  time  New  Jersey)  would  cer- 
tainly appear  to  be  in  order.    In  view  of  the  sometimes  wide  variations 
of  the  law  between  neighboring  states  it  would  of  course  be  best 
not  to  introduce  any  formality  into  these  meetings,  but  to  have  the 
understandings  arrived  at  mere  "gentlemen's  agreements."    As  such 
they  should  go  far  to  allay  interstate  misunderstandings  and  break 
the  force  of  the  constantly  recurring  employers'  argument  in  regard  to 
throttling  competition.    They  should  certainly  serve  as  a  spur  to  the 
laggard  states  in  each  group. 

iMost  of  our  existing  laws  provide  that  the  department  shall  collect  data 
for  the  commission  upon  request,  but  so  long  as  the  two  agencies  rcmam  separate 
this  is  apt  to  cause  friction.  The  new  Texas  law  overcomes  this  difficulty  by 
providing  that  the  head  of  the  Bureau  of  Labor  Statistics  shall  himself  serve  as 
chairman  of  the  new  commission.  u    u     j 

2  The  new  North  Dakota  law  gives  the  task  of  wage-settmg  into  the  hands 
of  the  existing  Workmen's  Compensation  Bureau;  while  the  iqiq  reorganization 
act  of  Massachusetts  transfers  it  to  the  three  members  of  the  newly  created 
Department  of  Labor  and  Lidustries  who  form  the  State  Board  of  ConciliaUon. 


im 


778       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

In  making  all  these  specific  recommendations  we  have  not  forgotten 
that  at  the  basis  of  all  our  reforms  must  lie  a  growth  of  public  con- 
fidence and  interest  in  the  work  of  the  commissions.    Ihe  chain'^of 

minrmaili-WilMB  auLlVlly rarnBTioTfrorger  tFan  its  weakest  link, 

which  is  the  assistance  every  commission  has  to  receive  from  the 
public — in  the  form  of  adequate  representation  on  its  boards,  at- 
tendance at  its  hearings,  support  from  the  courts,  and,  above  all, 
adequate  appropriations  from  the  state  legislature.  The  financial 
difficulties  under  which  some  of  our  most  progressive  commissions 
have  been  struggling  make  the  degree  of  their  success  really  astound- 
ing.i  The  commissions  themselves  must  of  course  do  all  they  can  to 
extend  the  field  of  their  publicity.  Whenever,  as  in  the  case  of 
Massachusetts,  they  have  been  blessed  with  sufficient  funds,  they  have 
indeed  gone  into  print  very  vigorously,  if  somewhat  learnedly.  But 
the  larger  and  less  dignified  task  of  widespread  popular  appeal  must 
necessarily  rest  with  the  outside  friends  of  the  movement.  If  half 
the  energy  that  habitually  goes  to  pushing  minimum-wage  campaigns 
were  carried  over  and  devoted  to  popularizing  the  work  of  the  com- 
missions when  once  they  have  been  established,  the  whole  range  of 
problems  we  have  been  discussing  would  be  immensely  simplified. 


Seattle,  Washington 


Dorothy  \V.  Douglas 


lis  it,  for  example,  generally  known  that  the  Oregon  Commission  has  an 
annual  appropriation  for  all  purposes  (including  secretary's  salary,  office  ex- 
penses, invesUgations,  rent,  pubUcity,  inspection,  and  enforcement!)  of  only 
$3500  ? 


XLIV 

OPERATION  OF  THE  INDUSTRIAL  DISPUTES  IN- 
VESTIGATION ACT  OF  CANADA^ 

INTRODUCTION 

OMITTING  administrative  details,  the  essential  features  of  the 
Canadian  Industrial  Disputes  Investigation  Act  may  be  ex- 
pressed in  a  statement  of  purpose  and  scope.    The  purpose  of  the  act 
as  expressed  in  the  complete  title  is  "  to  aid  in  the  prevention  and 
settlement  of  strikes  and  lockouts  in  mines  and  industries  connected 
with  public  utilities."-    Although  the  title  thus  disclaims  restriction 
of  the  right  to  strike  or  lock  out  and  limits  the  scope  to  disputes  in 
industrie's  affecting  directly  the  public  welfare,  the  act  provides  that 
a  strike  or  lockout  in  these  industries  is  illegal  until  the  dispute  has 
been  reported  on  by  a  board  of  conciliation  and  investigation  and, 
further,  that  industries  other  than  those  specified  may  be  brought 
within  the  scope  of  the  act  by  agreement  of  both  parties  to  the 
dispute,  the  right  to  strike  or  lock  out  being  suspended  during  an 
investigation.    This  restriction  upon  the  right  to  strike  or  lock  out 
pending  an  investigation  has  caused  the  act  to  be  known  generally  as 
the  Compulsory  Investigation  Act. 

The  Canadian  Industrial  Disputes  Investigation  Act  has  been  in 
operation  since  March  22,  1907.'  The  numerous  reports  appearing 
as  a  result  of  official  and  personal  inquiries  in  addition  to  the  monthly 
and  annual  publications  of  the  Canadian  Department  of  Labor  are 
evidences  of  the  widespread  interest  in  the  results  of  the  adminis- 
tration of  the  act.  For  the  most  part,  however,  reports  on  the  act 
have  dealt  with  disputes  referred  to  boards  for  adjustment  or  in 

1  Taken  in  part  from  the  U.S.  Bureau  of  Labor  Statistics,  Bulletin  No.  233 

2  Scope  extended  March  23,  1916,  by  order  of  the  Governor  General  in 
council  to  include  munitions  of  war  industries. 

3  Amended  May  4,  1910. 

779 


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780       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

which  application  was  made  for  such  reference  and,  while  directing 
attention  to  violations  and  to  disputes  in  which  strikes  or  lockouts 
were  not  averted  by  reference  to  boards,  have  not  been  concerned 
in  large  measure  with  the  question  of  illegal  strikes  and  lockouts  or 
the  enforcement  of  the  penal  provisions.  Nevertheless,  our  chief 
interest  in  the  act  as  an  experiment  in  government  intervention  is 
not  in  its  administration  as  a  conciliatory  measure,  but  in  the 
compulsory  investigation  and  restrictive  provisions  of  the  act  which 
serve  to  characterize  it. 

Upon  this  point  several  observers  have  expressed  opinions.  Sir 
George  Askwith,  Chief  Industrial  Commissioner  of  Great  Britain, 
visited  Canada  during  the  latter  part  of  19 12  for  the  purpose  of  in- 
quiring into  the  working  of  the  Industrial  Disputes  Investigation 
Act.  Speaking  of  the  suitability  of  the  Canadian  act  to  Great  Britain 
and  concluding  his  observations,  Mr.  Askwith  says : 

Where  it  (the  Industrial  Disputes  Investigation  Act)  was  frankly 
accepted  as  a  means  of  preventing  disputes  it  has  worked  extremely 
well,  but  where  ...  its  introduction  has  been  resented,  it  has  not 
succeeded  to  the  same  extent.  In  such  latter  cases  where,  by  the 
imposition  of  penalties,  efforts  have  been  made  to  enforce  the  act 
the  results  have  not  been  satisfactory. 

The  question  then  arises,  What  is  the  real  value  of  the  act,  and 
can  any  points  in  the  act  be  suitably  adapted  to  this  country'?  Is 
the  restriction  upon  the  right  of  proclaiming  a  lockout  or  strike  so 
much  of  the  essence  of  the  act  as  to  make  the  act  of  no  effect  if  such 
restrictions  were  not  compulsory  ?  And  do  the  penalties  which  are 
proposed  to  be  enforced  for  breach  of  the  restrictions  of  the  act  add 
to  its  value? 

In  my  opinion  the  real  value  of  the  act  does  not  lie  in  either  of 
these  propositions,  and  certainly  not  in  the  second.  The  pith  of  the 
act  lies  in  permitting  the  parties  and  the  public  to  obtain  full  knowl- 
edge of  the  real  cause  of  the  dispute  and  in  causing  suggestions  to  be 
made  as  impartially  as  possible  on  the  basis  of  such  knowledge  for 
dealmg  with  existing  difficulties,  whether  a  strike  or  lockout  has  com- 
menced or  not.  This  action  on  behalf  of  the  public  allows  an  ele- 
ment of  calm  judgment  to  be  introduced  into  the  dispute  which  at 
the  time  the  parties  themselves  may  be  unable  to  exercise. 

It  is  claimed,  and  the  claim  is  backed  up  by  statistics,  that  the 
restrictions  upon  a  strike  or  lockout  prior  to  such  a  judgment  have 
been  of  great  assistance  in  causing  a  calm  discussion  or  investigation 
at  an  early  date.  If  the  power  of  giving  such  judgment  had  existed 
without  the  restrictions,  and  if  the  various  trades  affected  had  been 


THE  INVESTIGATION  ACT  IN  CANADA 


781 


gradually  educated  to  see  the  advantage  of  discussion  prior  to  a 
dispute  and  had  had  the  means  by  and  through  which  such  dis- 
cussion could  take  place,  it  may  be  that  practically  similar  results 
would  have  been  obtained,  without  the  difficulty  of  having  a  law, 
the  complete  enforcement  of  which  is  almost  impracticable,  and 
which,  while  it  has  been  accepted  in  cases  where  education  has 
existed,  has  been  found  very  difficult  in  cases  where  the  law  is  resented 
and  joint  consent  has  not  been  in  being.^ 

Writing  in  19 10  for  the  United  States  Bureau  of  Labor  Statistics 

and  under  the  heading  ''Suggested  Amendments,"  Dr.  Victor  S. 

Clark  observes : 

If  men  can  strike  vnth  impunity  in  disregard  of  the  law,  what  is 
the  value  of  the  latter  in  preventing  or  postponing  strikes  ?  Will  the 
act  not  fall  into  abeyance  except  in  those  minor  and  less  acute  dis- 
putes where  there  is  least  call  for  government  intervention?  Has  a 
law  any  force  at  all  that  operates  only  by  the  tolerance  of  the  law- 
breakers? It  should  be  recognized  that  expediency  must  constantly 
be  consulted  in  administering  such  an  act;  but  it  would  seem  that 
the  latter,  though  it  may  retain  some  residuary  value  as  providing 
convenient  machinery  for  public  mediation,  must  lose  its  distinctive 
character  and  its  interest  as  experimental  legislation  unless  some  Vv-ay 
is  discovered  to  secure  the  observance  of  the  clauses  deferring  strikes 
and  lockouts  until  after  an  investigation  has  been  held.  Unless  these 
clauses  are  enforced,  the  law  becomes  an  ordinary  conciliation  act, 
burdened  by  the  discredit  of  its  unenforced  provisions.^ 

The  same  investigator  in  a  paper  before  the  Academy  of  Political 
Science  in  the  city  of  New  York,  November  22,  19 16,  speaking  of 
illegal  strikes  in  Canadian  industries,  remarked  that : 

No  effort  has  been  made  in  the  past  to  punish  a  large  body  of 
men  for  striking.  This  raises  the  question  of  the  value  of  the  penal 
provisions  of  the  law.  It  is  argued  that  if  the  act  does  not  put 
strikers  in  jail  and  subject  offending  employers  to  heavy  fines,  these 
provisions  are  useless.  But  even  though  violations  are  seldom  prose- 
cuted, neither  strikers  nor  employers  dare  defy  the  law  of  the  land 
in  disputes  prominently  before  the  public  and  affecting  the  pros- 
perity and  comfort  of  a  large  body  of  citizens.    By  doing  so  they 

1  Report  to  the  Board  of  Trade  (Great  Britain)  on  the  Industrial  Disputes 
Investigation  Act  of  Canada,  1907,  by  Sir  George  Askwith,  K.  C.  B.,  K.  C.,  Chief 
Industrial  Commissioner,  p.  iS- 

-"Canadian  Industrial  Disputes  Investigation  Act  of  1907,"  by  Victor  S. 
Clark,  Ph.D.,  U.S.  Department  of  Commerce  and  Labor  Bulletin  No.  86, 
pp.  19,  20. 


If 


I' 


II 


i 


782       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

would  put  a  powerful  weapon  in  the  hands  of  their  opponents,  and 
they  would  fatally  prejudice  their  case  in  the  high  court  of  public 
opinion.^ 

Honorable  F.  A.  Acland,  Deputy  Minister  of  Labor  for  Canada 
and  Registrar  of  Boards  of  Conciliation  and  Investigation,  writes : 

Reference  has  been  made  to  the  strikes  occurring  in  disputes  which 
had  been  before  boards  and  had  not  been  adjusted.  There  has  been 
also,  in  industries  coming  under  the  act,  a  considerable  number  of 
strikes  in  disputes  which  have  not  gone  before  a  board  for  investiga- 
tion. Work  ceased  in  these  cases  without  regard  to  the  act.  Many 
of  the  serious  coal-mining  strikes  in  western  Canada  during  recent 
years  have  occurred  in  this  way. 

What,  it  may  be  asked,  becomes  of  the  penalties  prescribed  for 
these  apparent  infringements  of  the  statute?  The  reply  must  be 
that  such  cases  have  seldom  gone  to  the  courts.  It  has  not  been  the 
policy  of  the  successive  ministers  under  whose  authority  the  statute 
has  been  administered  to  undertake  the  enforcement  of  these  provi- 
sions. The  parties  concerned,  or  the  local  authorities,  have  laid 
information  occasionally,  and  there  have  been  in  all  eii^ht  or  ten 
judicial  decisions.  The  mining  industry  has  been  the  chief  delin- 
quent in  the  matter  of  infringements,  and  there  have  been  occasional 
derelictions  on  the  part  of  the  lower  grades  of  transport  or  shipping 
labor ;  m  the  higher  grades  of  railway  labor  the  act  has  been  well 
observed. - 


DIFFICULTY  OF  MEASURING  EFFECTIVENESS  OF  ACT 

Before  proceeding  to  an  analysis  of  trade  disputes  occurring  in 
industries  within  the  scope  of  the  act,  or  bjrought  within  its  scope  by 
the  agreement  of  both  parties  to  the  dispute,  it  seems  proper  to 
point  out  that  statistics  do  not  furnish  incontrovertible  evidence  of 
the  success  or  failure  of  legislative  measures  to  prevent  or  settle 
strikes  or  lockouts,  and  to  state  that  the  inquiry  upon  which  this 
report  is  based  was  not  made  with  the  expectation  of  pronouncing 
upon  the  value  of  the  Canadian  act  in  toto  as  an  instrument  for  the 
adjudication  of  labor  disputes.  To  arrive  at  such  a  conclusion  it 
would  be  necessary  to  resort  to  laboratory  methods— to  assume  a 

'  Proceedings  of  the  Academy  of  Political  Science  in  the  city  of  New  York 
Vol.  VII,  No.  I,  pp.  15,  16.  ' 

-labor  Gazette,  April,  1916,  p.  1118.      (Reprint  from  Canadian  Law  Times 
of  March,  1916.) 


THE  INVESTIGATION  ACT  IN  CANADA 


7^3 


static  society  upon  which  successive  experiments  might  be  tried  under 
identical  conditions  and  to  devise  a  means  of  recording  concretely 
human  reactions  to  such  experiments.    It  is  axiomatic  that  social 
and  economic  conditions  make  for  industrial  peace  or  unrest  irrespec- 
tive of  antistrike  or  lockout  legislation.    Any  attempt,  therefore,  to 
compare,   without   correlation  with   other   factors,   the   number   of 
trade  disputes  resulting  in  strikes  or  lockouts  during  a  period  prior 
to  the  passage  of  measures  for  their  adjustment  with  strikes  and 
lockouts  during  a  subsequent  period  is  open  to  serious  objection. 
Moreover,  it  is  impossible  to  estimate  the  salutary  effect  of  anti- 
strike  or  lockout  legislation  in  making  for  voluntary  negotiations 
and  in  preventing  precipitate  action  whether  or  not  the  aid  of  such 
legislation   is   directly   invoked.    It    is   apparent   that   accelerating 
influences  in  some  industries  have  served  to  discredit  the  value  of 
the  Canadian  act,  whereas  in  other  industries  retarding  influences 
have  tended  measurably  to  decrease  the  number  of  strikes  and  lock- 
outs and  give  undue  credit  to  its  restrictive  provisions.    Thus  the 
growth  of  unionism  in  the  coal-mining  industry  has  led  to  concerted 
strike  action  for   the  establishment   of  union  principles,  approxi- 
mately 50  per  cent  of  the  time  lost  in  mining  strikes  during  the 
period  1907-19 16  occurring  in  strikes  for  union  recognition,  for  the 
principle  of  the  closed  shop,  or  for  the  reinstatement  of  discharged 
union  employees.    In  industries  connected  with  the  operation  and 
maintenance  of  steam  railways,  on  the  other  hand,  unionism  is  more 
generally  recognized  and  the  principle  of  the  working  agreement  more 
generally  accepted.    INIeasured  solely  by  the  number  of  strikes  and 
lockouts,  the  number  of  employees  affected,  or  the  time  lost,  it  is 
probable  that  any  legislation  would  have  evidenced  merit  in  the 
prevention  of  railway  strikes  and  failure  in  the  prevention  of  mining 
strikes.    It  is  idle  to  speculate  as  to  how  many  strikes  or  lockouts 
might  have  occurred  in  Canadian  industries  since  the  inception  of 
the  Industrial  Disputes  Investigation  Act  had  that  act  not  been 
passed.    It  is  incorrect  to  assume  that  every  dispute  referred  under 
the  act  would  have  resulted  in  a  strike  or  lockout  but  for  such 
reference,  even  though  a  statutory  declaration  of  intent  to  strike 
or  lock  out  is  required  before  a  board  can  be  created.    Any  analysis, 
therefore,  must  be  made  with  a  frank  recognition  that  it  is  impossible 
to  measure  absolutely  and  concretely  the  results  of  social  legislation. 


I 


( 


'I 


ii 


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i 


784       TR.\DE  UNIONISM  AND  LABOR  PROBLEMS 

Apart  from  the  interpretation  of  strike  and  lockout  statistics  is 
the  question  of  reliability  of  such  information.  It  is  safe  to  assume 
that,  in  point  of  number,  fewer  strikes  and  lockouts  escape  public 
attention  subsequent  to  the  inception  of  laws  designed  to  prevent  or 
settle  such  disputes  than  for  a  previous  period.  The  benefits  from 
such  legislation  may  thus  appear  less  than  they  really  are  because  of 
a  more  complete  record  of  labor  disturbances. 

^Moreover,  if  the  importance  of  disputes  is  to  be  measured,  it  is 
necessary  to  consider  as  well  the  number  of  employees  affected  and, 
if  the  dispute  results  in  a  strike  or  lockout,  the  time  lost.  Each  of 
these  considerations  offers  new  difficulties.  However  honest  in  intent 
either  side  may  be,  it  is  natural  for  each  to  minimize  the  strength 
of  the  other  and  to  magnify  its  own  position.  The  questions  of 
when  a  strike  or  lockout  ends,  how  the  time  loss  is  to  be  measured, 
how  to  determine  the  number  of  employees  directly  affected  for  the 
purpose  of  computing  such  time  loss,  what  consideration  is  to  be 
given  to  employees  indirectly  affected  (especially  in  sympathetic 
action  and  in  declarations  of  intent  to  strike  or  lock  out  not  resulting 
in  such  action),  are  pertinent  to  any  statistical  analysis  of  trade 
disputes  and  permit  of  wide  latitude  in  interpretation. 

So  far  as  the  employer  is  concerned,  a  strike  is  in  being  only  if 
the  operation  of  his  establishment  is  seriously  interrupted,  and  termi- 
nates when  the  operation  is  resumed;  public  recognition  is  most 
keen  when  the  strike  reflects  itself  in  inconvenience  to  the  pub- 
lic;  whereas  employees  affected  regard  the  strike  as  unsettled  so 
long  as  their  organization  remains  intact  and  they  are  not  returned 
to  their  former  positions.  Conflicting  reports  as  to  the  duration  of 
a  strike  and  the  number  of  employees  aft'ected  are  therefore  not 
unusual. 

Undoubtedly  the  best  index  of  the  importance  of  a  strike  or  lock- 
out, apart  from  its  immediate  effect  upon  the  public  welfare,  is  the 
time  loss.  Remedial  legislation,  however,  is  most  effective  before  a 
dispute  reaches  the  acute  stage  of  a  strike  or  lockout,  and  obviously 
the  importance  of  such  legislation  cannot  be  estimated  by  time  loss 
averted  in  disputes  settled  without  cessation  of  work.  Furthermore, 
the  time  loss  is  at  best  but  an  approximate  figure.  It  is  usually  deter- 
mined by  multiplying  the  number  representing  employees  affected 
by  the  number  of  workdays'  duration,  but  this  may  lead  to  grave 


THE  INVESTIGATION  ACT  IN  CANADA 


7S5 


inaccuracy  in  cases  where  the  plant  is  operated  with  a  reduced  force 
and  the  number  of  employees  on  strike  varies  from  day  to  day. 

Even  greater  inaccuracy  arises  in  the  use  of  figures  representing 
employees  indirectly  affected.  A  threatened  coal  strike  might  con- 
ceivably affect  indirectly  every  other  industry  in  the  country, 
and,  by  the  same  analysis,  every  strike  must  affect  indirectly  em- 
ployees in  other  industries.  If  such  employees  are  to  be  considered 
in  an  aggregate  with  employees  directly  affected,  a  definite  rule  must 
be  followed  which  should  exclude,  as  too  problematical  for  consider- 
ation, those  employees  reported  to  be  indirectly  affected  in  contem- 
plated strikes  or  lockouts  and  should  include  only  those  thrown  out 
of  work  as  a  direct  result  of  strike  or  lockout. 

An  additional  difficulty  is  encountered  when  an  attempt  is  made  to 
harmonize  a  classification  of  disputes  adopted  prior  to  the  enactment 
of  antistrike  or  lockout  legislation  with  the  classification  adopted  or 
suggested  by  such  legislation.    Strikes  and  lockouts  have  been  re- 
ported by  the  Canadian  Department  of  Labor  since  1901.    In  these 
reports  the  basis  of  classification  is  the  industry,  but  no  industrial 
group  as  thus  reported  comes  wholly  within  the  scope  of  the  Indus- 
trial Disputes  Investigation  Act  as  interpreted  by  those  administering 
it.    Thus,  mining  and  quarrying  constitute  one  group  in  the  monthly 
and  annual  summaries  of  trade  disputes,  but  in  the  application  of 
the  act  quarrying  has  been  excluded  from  its  restrictive  provisions. 
Metal  and  shipbuilding  trades  constitute  a  group  which  would  be 
entirely  without  the  scope  of  the  act  but  for  the  inclusion  of  electrical 
workers,   linemen,   and   ship   repairmen.    Under   the   group   ''Gen- 
eral  Transport"    are   included   street-railway   employees,   shipping 
employees,  steam-railway  employees,  and  teamsters.    Teamsters  have 
been  considered  as  within  the  scope  of  the  act,  however,  only  when 
their  work  is  connected  with  the  handling  of  freight  at  terminals. 
The  group  "Unskilled  Labor,"  while  mainly  outside  the  restrictive 
provisions  of  the  act,  may  contain  laborers  who,  by  virtue  of  the 
work  performed  in  connection  with  certain  public  utilities,  belong 
properly  within  the  scope  of  the  act.    Moreover,  the  Industrial  Dis- 
putes Investigation  Act  is  not  applicable  to  disputes  involving  fewer 
than  10  employees,  whereas  strikes  and  lockouts  are  reported  in  all 
cases  where  6  or  more  employees  are  involved.    On  the  other  hand, 
the  applicability  of  the  act  is  not  determined  by  the  duration  of  the 


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if 


S??"''  7 


786       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

strike  or  lockout,  whereas  it  is  a  rule  of  the  Canadian  Department 
of  Labor  not  to  report  strikes  or  lockouts  of  less  duration  than 
twenty-four  hours. 

SCOPE  OF  ACT 

Obviously  any  attempt  to  measure  the  effectiveness  of  the  Cana- 
dian act  must  be  preceded  by  a  consideration  of  the  scope  of  the 
act.  In  the  absence,  however,  of  any  interpretation  having  the 
force  of  a  legal  opinion,  it  is  impossible  to  establish  an  inflexible 
rule  of  action. 

To  the  extent  that  the  act  is  administered  as  a  conciliatory  and 
not  as  a  coercive  measure,  it  would  obviously  be  unwise  for  officials 
to  pronounce  upon  the  legality  of  strikes  and  lockouts  not  coming 
before  a  board,  lest  the  circumstances  surrounding  subsequent  similar 
disputes  necessitate  a  reversal  of  opinion. 

It  is  recognized,  too,  that  if  doubt  exists  as  to  the  enforceability  of 
provisions,  the  measure  containing  them  is  often  more  useful  if  pur- 
posely indefinite  and  if  discretion  is  permitted  in  its  application. 
Conversely,  if  discretion  is  permitted,  the  question  of  expediency 
plays  so  important  a  role  that  anticipation  of  action  might  serve  to 
defeat  its  purpose. 

If,  on  the  other  hand,  an  effort  is  being  made  to  administer  the 
act  strictly  as  a  compulsory  measure,  an  admission  of  illegality  must 
necessarily  reflect  upon  the  enforceability  of  the  provisions  of  the 
act  or  upon  its  administration.  In  either  case  subsequent  applica- 
tion of  the  provisions  would  be  more  difficult. 

The  safest  course,  no  doubt,  and  the  one  taken  in  the  analysis  pre- 
sented later,  is  to  assume  that  when  the  Minister  of  Labor  constitutes 
a  board  of  conciliation  and  investigation  upon  the  application  of  one 
party  to  a  dispute  it  amounts  to  a  decision  that  the  act  applies  to 
that  class  of  disputes.  Such  action  by  the  Minister  of  Labor,  how- 
ever, does  not  constitute  a  precedent  which  either  he  or  subsequent 
ministers  are  bound  to  follow,  nor  does  it  in  any  way  limit  the  right 
of  either  party  to  apply  for  an  injunction  seeking  to  restrain  a  board 
from  proceeding,  on  the  ground  that  the  act  does  not  apply  to  a 
particular  dispute. 

The  act  applies  to  "disputes  in  mining  property,  agency  of  trans- 
portation   or    communication    or    public    service    utility    including 


THE  INVESTIGATION  ACT  IN  CANADA 


787 


.  .  .  railways,  whether  operated  by  steam,  electricity,  or  other  motive 
power,  steamships,  telegraph  and  telephone  lines,  gas,  electric  light, 
water  and  power  works"  involving  ten  or  more  employees  in  skilled 
or  unskilled  manual  or  clerical  work.  It  should  be  noted,  too,  that 
the  act  applies  only  to  disputes  in  which  the  controversy  has  reached 
a  stage  such  that,  "  failing  an  adjustment  of  the  dispute  or  a  reference 
thereof  by  the  minister  to  a  board,  ...  a  lockout  or  strike  will 
be  declared  .  .  .  and  that  the  necessary  authority  to  declare  such 
lockout  or  strike  has  been 'obtained."  It  is  provided  further  that 
the  violation  of  privileges,  rights,  and  duties  of  employers  or  em- 
ployees does  not  constitute  a  dispute  in  the  meaning  of  the  act  if 
such  violation  is  in  itself  an  indictable  offense.  Subject  to  these  limi- 
tations and  to  the  provision  that  for  disputes  in  industries  not  speci- 
fied in  the  act  both  parties  must  concur  in  the  application,  it  is 
possible  for  disputes  in  all  industries  to  be  referred  for  adjustment, 
but  in  this  respect  the  act  is  simply  a  conciliatory  measure  with 
provision  for  voluntary  arbitration. 

From  the  circumstances  surrounding  the  inception  of  the  act — 
a  prolonged  coal  strike — ^it  might  be  inferred  that  the  term  "min- 
ing" had  reference  to  coal  mines.  Boards  have  been  created,  how- 
ever, for  metal  miners,  and  asbestos  miners  have  been  considered 
within  the  scope  of  the  act.  "Transportation"  permits  of  greater 
latitude  in  interpretation,  but  it  is  not  clear  whether  the  phrase 
"agency  of  transportation"  is  intended  to  be  defined  as  "railways 
.  .  .  operated  by  steam,  electricity,  or  other  motive  power,"  or 
whether  the  inclusion  of  specific  means  excludes  other  means.  Thus 
far  it  seems  to  have  been  the  policy  of  the  department  to  include 
without  question  the  operation  and  maintenance  of  steam,  electric, 
and  water  transportation  agencies  serving  as  public  carriers.  Team- 
sters have  been  considered  as  a  transportation  agency,  as  previously 
stated,  when  their  work  is  intimately  connected  with  the  handling  of 
freight  at  the  ends  of  transportation  lines.  The  same  reasoning, 
however,  would  lead  to  the  inclusion  of  transfer  companies  carrying 
passengers  and  baggage  and  might  conceivably  embrace  the  employees 
of  any  concern  doing  general  transfer  work  for  the  public  whether 
by  team,  motor  truck,  or  taxicab.  The  maintenance  of  such  transfer 
agencies  would  undoubtedly  bring  within  the  scope  of  the  act  in- 
dustries not  contemplated  by  those  who  framed  it,  yet  the  relation 


( 


"  •!,. 


788       TRADE  UNIONISM  AND  LABOR  PROBLEM^ 

bf  a  blacksmith  shop,  a  harness  shop,  a  public  garage,  a  paving  crew, 
or  a  road  gang  to  certain  forms  of  public  transportation  is  somewhat 
similar  to  the  relation  which  a  roundhouse,  a  railway  machine  shop, 
or  a  section  gang — in  which  latter  industries  the  act  has  been  held 
to  be  applicable — bears  to  steam  railways.  The  construction  of 
transportation  facilities  has  been  excluded  in  the  application  of  the 
act,  but  it  is  sometimes  difficult  to  determine  where  maintenance 
leaves  off  and  construction  begins. 

Somewhat  more  indefinite  is  the  expression  "industries  connected 
with  public  utilities."  The  term  public  utility  has  not  received  legal 
interpretation  in  Canada  and  admits  of  a  large  measure  of  discretion 
in  its  use.  In  Australasian  states  public  utilities  include  the  supply 
and  distribution  of  electricity  for  light  or  power ;  gas  for  lighting, 
cooking,  or  industrial  purposes ;  water  for  domestic  purposes  ;  the 
supply  of  milk  and  the  slaughtering  or  supply  of  meat  for  domestic 
consumption ;  the  production  or  distribution  of  any  article  of  food 
the  deprivation  of  which  might  tend  to  endanger  human  life  or 
cause  serious  bodily  injury ;  the  working  of  any  ferry,  tramway,  or 
railway  used  for  the  public  carriage  of  goods  or  passengers  ;  and  the 
production  and  distribution  of  coal.  In  the  application  of  the 
Canadian  act  occupations  connected  with  the  supply  and  distribution 
of  gas,  electricity,  and  water  for  domestic  consumption  are  admittedly 
within  the  scope  of  the  act,  though  the  guiding  principle  of  the 
relation  to  the  public  welfare  might  conceivably  bring  other  indus- 
tries within  the  list  of  public  utilities. 

METHOD  OF  REFERRING  DISPUTES  UNDER  THE  ACT 

As  stated  previously,  the  act  denies  the  right  to  strike  or  lock  out 
in  certain  industries  until  the  matters  in  dispute  have  been  investi- 
gated and  reported  on  by  a  board  of  conciliation  and  investigation 
appointed  by  the  Minister  of  Labor.  It  is  provided,  however,  that 
the  initiative  in  such  an  investigation  must  be  taken  by  one  of  the 
parties  to  the  dispute.  That  is,  before  a  board  can  be  appointed 
either  employer  or  employees  must  make  formal  request  for  an  inves- 
tigation. If  the  dispute  occurs  in  an  industry  not  within  the  scope 
of  the  restrictive  provisions  of  the  act,  employer  and  employees 
must  concur  in  the  request  before  a  board  can  be  appointed.   After 


THE  INVESTIGATION  ACT  IN  CANADA  789 

the  application  has  been  made  in  accordance  with  the  provisions  of 
the  act,  it  rests  with  the  Minister  of  Labor  whether  a  board  shall  be 

^Thelct  provides  that  the  board  shall  consist  of  three  members, 
one  '^  appointed  on  the  recommendation  of  the  employer,  and  one  on 
the  recommendation  of  the  employees  (the  parties  to  the  dispute), 
and  the  third  on  the  recommendation  of  the  members  so  chosen  In 
case  of  failure  by  either  party  to  recommend  within  prescribed  time 
limits  the  minister  appoints  without  such  recommendation.  If  the 
two  members  first  appointed  fail  to  agree  upon  a  recommendation 
for  the  third  member  within  prescribed  time  limits,  the  mimster 
selects  the  third  member.   The  appointment  of  the  third  member 

completes  the  board. 

There  are  thus  three  distinct  steps  involved  before  a  dispute  is 
referred  under  the  act :  (i)  an  application  for  reference  ;  (2)  a  de- 
cision by  the  minister  to  constitute  a  board  of  conciliation  and  investi- 
gation ;  and  (3)  the  appointment  of  such  a  board.  It  is  important 
to  keep  these  distinctions  in  mind,  because  some  applications  for 
reference  do  not  receive  favorable  consideration  and  some  boards 
are  not  constituted  even  after  the  Minister  of  Labor  has  decided  m 

favor  of  such  action. 

In  its  publications  of  proceedings  under  the  act  the  Canadian 
Department  of  Labor  does  not  report  applications  for  reference  m 
which  (I)  a  board  was  refused;  (2)  a  settlement  was  effected  be- 
fore action  was  taken  by  the  Department  of  Labor  looking  to  the 
establishment  of  a  board;  or  (3)  the  department  was  unable  to  act 
owing  to  the  refusal  of  one  party  to  concur  in  the  application. 

CLASSIFICATION  OF  DISPUTES 

Disputes  occurring  in  industries  within  the  scope  of  the  act  may  be 
divided  broadly  into  two  groups :  strikes  and  lockouts,  and  disputes 
not  resulting  in  strikes  or  lockouts  but  in  which  statutory  declara- 
•  tion  of  intent  to  take  such  action  was  made.  It  is  apparent  that  the 
disputes  in  the  second  group  are  identical  with  disputes  not  result- 
ing in  strikes  or  lockouts  referred  under  the  act  or,  as  explained 
in  a  previous  section,  in  which  application  was  made  for  reference 
and  action  taken  by  the  Department  of  Labor  contemplating  the 


:|i  /i 


790       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

establishment  of  boards  of  conciliation  and  investigation.  Obviously 
there  have  been  disputes  in  industries  within  the  scope  of  the  act 
adjusted  without  the  occurrence  of  a  strike  or  a  lockout  and  without 
application  for  reference  but  which  may  not  be  included  in  this  group 
because  technically  they  are  not  within  the  scope  of  the  act  until 
an  application  for  reference  has  been  legally  made. 

The  second  group,  then,  of  disputes  within  the  scope  of  the  act 
is  made  up  of  disputes  not  resulting  in  strike  or  lockout  which  are 
within  the  scope  of  the  act  by  virtue  of  an  application  for  reference 
made  in  compliance  with  the  provisions  of  the  act  and  in  which  it 
was  the  intent  of  the  department  to  create  a  board. 

In  the  proceedings  under  the  act  disputes  may  also  be  divided 
into  strikes  and  lockouts,  and  disputes  not  resulting  in  strikes  or 
lockouts.  Both  groups  are  restricted  to  disputes  in  which  ( i )  boards 
were  constituted  within  the  meaning  of  the  act  or  (2)  application  was 
made  for  reference  and  action  taken  by  the  Department  of  Labor  con- 
templating the  establishment  of  a  board.  Each  group  may  thus  in- 
clude disputes  in  which  boards  were  not  constituted.  However,  by 
ruling  of  the  Canadian  Department  of  Labor,  all  applications  for 
reference  in  which  steps  have  been  taken  by  the  department  toward 
the  establishment  of  a  board  are  reported  in  the  official  proceedings 
under  the  act.  In  both  groups  also  a  statutory  declaration  of  intent 
to  strike  or  lock  out  was  made,  but  in  some  disputes  the  strike  or 
lockout  occurred  before  application  was  made  for  reference  under  the 
act  and  the  declaration  of  intent  was  thus  only  a  perfunctory 
procedure. 

Considering  only  the  intent  of  the  act,  which  is  to  avoid  interrup- 
tion to  industry,  any  strike  or  lockout  occurring  in  industries  within 
its  scope  indicates  a  failure  of  the  act.  Whether  this  failure  occurs  in 
spite  of  a  strict  observance  of  the  restrictive  provisions  of  the  act  or 
is  marked  by  an  attitude  of  indifference  toward,  or  open  defiance 
of,  such  provisions,  or  by  a  lack  of  confidence  in  boards  of  concilia- 
tion and  investigation,  is  best  shown  by  the  time  of  occurrence  of 
strikes  and  lockouts.  Thus,  strikes  and  lockouts  occurring  after 
boards  of  conciliation  and  investigation  have  been  given  opportunity 
to  adjust  the  points  in  controversy  indicate  the  greater  failure, 
although  the  parties  involved  in  such  strikes  and  lockouts  are  strictly 
law-abiding  in  the  sense  that  they  observe  the  restrictive  provisions 


THE  INVESTIGATION  ACT  IN  CANADA 


791 


of  the  act.  Strikes  and  lockouts  commencing  prior  to  an  application 
for  reference,  but  terminating  before  a  board  has  been  legally  con- 
stituted, may  indicate  ignorance  of  the  act  or  its  applicability  to 
particular  disputes.  Although  such  strikes  or  lockouts  are  illegal, 
the  offense  is  palliated  somewhat,  since  after  the  act  was  recognized 
in  a  formal  application  for  reference  the  disputants  became  law- 
abiding,  the  matters  in  dispute  being  held  in  abeyance  pending  an 
investigation.  Strikes  and  lockouts  commencing  prior  to  an  applica- 
tion for  a  board  and  continuing  after  the  board  is  constituted  indi- 
cate either  that  the  dispute  was  referred  contrary  to  the  wishes  of 
one  of  the  disputants  or  that,  while  willing  to  accept  the  services 
of  a  board,  one  or  the  other  was  unwilling  to  yield  the  right  to  strike  or 
lock  out  and  did  not  regard  the  penal  provisions  seriously.  Strikes  and 
lockouts  commencing  after  the  application  for  a  board  but  before 
the  investigation  is  completed  may  be  protests  against  delay  in  con- 
stituting the  board  or  in  completing  the  investigation,  or  may  indicate 
a  lack  of  confidence  in  the  board.  In  either  case  a  disregard  for  the 
penal  provisions  is  shown. 

It  has  seemed  desirable  to  make  a  distinct  group  of  strikes  and 
lockouts  occurring  in  industries  within  the  scope  of  the  act  without 
any  attempt's  being  made  to  invoke  its  aid.  It  is  the  practice  of  the 
Canadian  Department  of  Labor  when  an  illegal  strike  or  lockout 
occurs  or  is  imminent  to  bring  such  illegality  to  the  attention  of  the 
disputants  and  explain  the  purpose  of  the  act.  This  group  indi- 
cates an  open  defiance  of  the  penal  provisions  in  that  neither  party 
was  willing  to  make  application  for  a  board  of  conciliation  and 
investigation.^ 

COMPARISON  OF  DISPUTES  IN  INDUSTRIES  WITHIN  THE 
SCOPE  OF,  AND  IN  PROCEEDINGS  UNDER,  THE  ACT 

All  Disputes 
During  the  period  March  22,  1907,  to  December  31,  19 16,  there 
have  occurred  in  industries  within  the  scope  of  the  act  222  disputes 
resulting  in  strikes  and  lockouts,  affecting  100,608  employees,  whose 

iln  a  few  instances  application  was  made  for  reference  but  no  steps  were 
taken  by  the  department  looking  to  the  establishment  of  a  board,  and  the  cases 
are  not  officially  reported  as  applications  for  reference. 


I 


i'. 
1 


fli'li 


V 


792       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

lime  loss  was  4,838,647  working-days.  In  44  of  these,  involving 
44,086  employees  and  a  time  loss  of  3,665,969  days,  application  was 
made  for  reference  under  the  act.  Of  this  number,  18  disputes, 
affecting  20,330  employees  and  occasioning  a  time  loss  of  1,822,803 
days,  did  not  result  in  strikes  or  lockouts  until  after  the  investigation 
and  report  of  a  board  and  consequently  were  legal.  Thus  there  have 
been  204  illegal  strikes  and  lockouts,  affecting  80,278  employees, 
whose  time  loss  was  3,015,844  days.  Of  this  number,  178  disputes, 
involving  56,522  employees  and  a  time  loss  of  1,172,678  days,  oc- 
curred without  either  party  to  the  dispute  seeking  to  invoke  the 
aid  of  the  act. 

A  further  analysis  of  the  strikes  and  lockouts  in  which  applica- 
tion was  made  for  reference  under  the  act  shows  that  9  strikes,  in- 
volving 4606  employees  and  a  time  loss  of  38,070  days,  began  prior 
to  the  application  for  a  board  but  were  called  off  prior  to  the  com- 
pletion of  the  board,  the  matter  in  dispute  being  held  in  abeyance 
pending  an  investigation ;  5  strikes,  affecting  3950  employees,  whose 
time  loss  was  46,650  days,  began  prior  to  the  application  for 
a  board  and  were  adjusted  before  a  board  was  constituted;  5 
strikes,  affecting  11,034  employees,  whose  time  loss  was  1,623,456 
days,  began  prior  to  the  application  for  a  board  and  continued  after 
the  board  was  constituted;  7  strikes,  affecting  4166  employees 
and  resulting  in  a  time  loss  of  134,990  days,  began  after  the  appli- 
cation for  a  board  but  before  its  report. 

In  addition  to  the  44  strikes  and  lockouts  in  the  adjudication  of 
which  the  act  was  invoked,  173  disputes,  affecting  141,295  employees, 
not  resulting  in  strike  or  lockout  but  in  which  statutory  declaration 
of  intent  to  take  such  action  was  made,  were  referred  to  boards  of 
conciliation  and  investigation  under  the  act,  or  application  was  made 
for  such  reference  and  action  taken  by  the  Department  of  Labor  con- 
templating the  establishment  of  such  a  board.  In  36  of  these  dis- 
putes, affecting  34,145  employees,  a  settlement  was  reported  before 
a  board  was  constituted;  in  137  disputes,  affecting  107,150  em- 
ployees, boards  were  constituted.  How  many  of  these  137  disputes 
would  have  resulted  in  strikes  or  lockouts  but  for  reference  under 
the  act  is  problematical.  It  will  be  interesting,  however,  to  examine 
those  disputes  in  which  application  was  made  for  reference,  such 
application  being  accompanied  by  the  statutory  declaration  that, 


-  -p 


THE  INVESTIGATION  ACT  IN  CANADA  793 

failing  an  adjustment  or  a  reference,  a  strike  or  lockout  would  result, 
but  for  which  boards  were  not  constituted. 

Of  applications  in  which  boards  are  not  constituted  only  those  are 
reported  in  the  official  proceedings  in  which  action  is  taken  by  the 
Department  of  Labor  looking  to  the  establishment  of  a  board    Of 
the  disputes  thus  reported,  reference  has  been  made  to  S  stnkes, 
affecting  3950  employees,  and  to  36  disputes  not  resulting  m  strike 
or  lockout,  affecting  34,i4S  employees,  in  wmch  boards  were  not 
constituted.   Of  the  five  strikes,  all  began  prior  to  the  application 
for  boards  and  could  not  have  been  precipitated  by  a  failure  of 
reference.   Of  applications  in  disputes  not  reported  in  the  proceedings 
under  the  act,  14  disputes,  affecting  8247  employees,  were  in  indus- 
tries not  within  the  scope  of  the  act  and  for  which  the  department 
was  unable  to  grant  boards  owing  to  the  lack  of  concurrence  of  both 
parties  to  the  disputes.   Of  these  14  disputes,  6  disputes,  affecting 
6465  employees,  resulted  in  strikes  prior  to  the  applications  for 
boards,  and  the  inability  of  the  department  to  apply  the  act  could 
not  be  advanced  as  a  reason  for  the  strikes ;   i  strike,  affecting  96 
employees,  commenced  the  same  day  the  application  was  received 
but  presumably  not  until  the  other  party  to  the  dispute  had  refused 
to  concur  in  the  request  for  a  board. 

Summarizing  the  figures  of  the  preceding  paragraph,  it  will  be 
observed  that  there  were  55  disputes,  affecting  46,342  employees,  m 
which  application  was  made  for  reference  but  in  which  boards  were 
not  constituted.'    In  11  of  these  disputes,  affecting  10,413  employees, 
a  strike  occurred  prior  to  the  application  for  reference.   In  44  dis- 
putes, affecting  35,9^7  employees,  a  strike  or  lockout  did  not  occur 
prior  to  the  application  for  reference,  and  of  these,  43,  or  97-7  Per 
cent  of  the  disputes,  affecting  35,833,  or  99-7  per  cent,  of  the  em- 
ployees, were  adjusted  without  the  occurrence  of  a  strike  or  lockout. 
It  is  recognized,  however,  that  the  formal  action  of  applying  for  a 
board  may  in  itself  make  for  a  resumption  of  negotiations  between 
the  parties  to  a  dispute  and,  too,  that  after  the  application  is  received 
the  department  is  in  a  favorable  position  to  serve  as  a  conciliatory 

>  Other  applications  for  reference,  not  reported  officially  '"  7>^*  ^^^^^ 
were  refused  for  technical  or  other  reasons,  or  m  which  settlements  were 
Tfterted  before  action  was  taken  by  the  department,  are  not  considered  m 
this  analysis. 


^1 


II 


!' 


■•*1 


794       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

or  mediatory  agency  and  may  aid  in  securing  a  settlement  before 
a  board  IS  completed.  It  is  recognized,  too,  that  disputes  settled 
without  the  occurrence  of  a  strike  or  lockout  and  without  reference  to 
boards  may  not  have  presented  the  same  degree  of  difficulty  in  adjust- 
ment as  disputes  referred  to  boards.  To  the  extent,  however  that 
the  statutory  declaration  of  intent  to  strike  or  lock  out  indicates  the 
seriousness  of  the  controversy,  all  disputes  are  on  a  parity  Meas- 
ured thus,  It  is  apparent  that  of  the  137  disputes  referred  to  boards 
and  not  resulting  in  strike  or  lockout  a  considerable  number  would 
have  been  adjusted  without  the  occurrence  of  strikes  or  lockouts  even 
though  not  referred  to  boards. 

Viewed  strictly  as  a  conciliatory  measure,  the  usefulness  of  the  act 
should  be  reflected  in  the  applications  for  reference  under  Section  6^ 
whereby  the  concurrence  of  both  disputants  is  necessary  in  disputes 
outside  specified  industries  before  a  board  can  be  created    There 
was  a  total  of  26  applications  under  Section  63,  in  disputes  affect- 
ing  13,781   employees.    In   12   disputes,  affecting  5534  employees, 
boards  were  constituted ;  in  14  disputes,  affecting  8247  employees 
the  department  was  unable  to  act,  owing,  as  previously  stated,  to  the 
absence  of  joint  consent  of  the  disputants.    During  the  same  period 
there  occurred  a  total  of  691  strikes  and  lockouts,  affecting  149  812 
employees,  whose  time  loss  was  3,254,332  working-days,  in  indus;ries 
no  twithin  the  scope  of  the  act  but  which  might  have  been  brought 
within  Its  scope  by  agreement  of  both  parties  to  the  disputes. 

Mining 
An  analysis  of  mining  disputes  for  the  period  under  consideration 
shows  that  75  strikes  or  lockouts  occurred,  affecting  50,304  em- 
ployees and  occasioning  a  time  loss  of  3,973,381  days.  Of  this 
number,  50  strikes,  affecting  33,775  employees,  whose  time  loss  was 
967,780  days,  occurred  without  reference  to  the  act,  and  25  strikes 
affecting  25,529  employees,  whose  time  loss  was  3,005,601  davs' 
were  referred  under  the  act  or  application  was  made  for  reference! 

whnt'r  r  "^  ""^'^  '^'  ^''^  ^'  ^^^^^^"g  ^591  employees, 
whose  time  loss  was  21,525  days,  occurred  prior  to  application  fo; 
reference  but  terminated  prior  to  the  completion  of  a  board  and 
pending  its  investigation  and  report;  4  strikes,  affecting  10,034  em- 
ployees, whose  time  loss  was  1,585,456  days,  commenced  prior  to  an 


THE  INVESTIGATION  ACT  IN  CANADA 


795 


application  for  a  board  and  continued  after  the  board  was  consti- 
tuted;  5  strikes,  affecting  3825  employees  and  occasioning  a  time 
loss  of  69,785  days,  commenced  after  the  application  for  a  board 
but  before  its  report;   10  strikes,  affecting  8229  employees,  whose 
time  loss  was  1,316,085  days,  commenced  after  the  investigation  and 
report  of  a  board;  in  2  strikes,  affecting  1850  employees,  whose 
time  loss  was  12,750  days,  a  board  was  applied  for  but  not  com- 
pleted.   Of  the  disputes  not  resulting  in  strike  or  lockout  referred 
under  the  act,  or  in  which  application  was  made  for  reference  and 
action  taken  by  the  Department  of  Labor  contemplating  the  estab- 
lishment of  a  board,  34  disputes,  affecting  24,670  employees,  were 
mining  disputes.    In  5  of  these  disputes,  affecting  2860  employees, 
a  settlement  was  effected  before  boards  were  completed. 

Railways 

A  similar  analysis  of  disputes  connected  with  the  operation  and 
maintenance  of  steam  railways  shows  that  62  strikes  or  lockouts 
occurred,  affecting  24,187  employees  and  occasioning  a  time  loss  of 
724,134  days.    Of  this  number  50  strikes,  affecting  9016  employees, 
whose  time  loss  was  90,970  days,  were  not  referred  under  the  act, 
whereas  12  strikes,  affecting  15,171  employees,  whose  time  loss  was 
633,164  days,  were  referred  under  the  act.    Of  the  strikes  referred 
under  the  act,  or  in  which  application  was  made  for  reference,  3, 
affecting   11 55   employees,  whose  time  loss  was   5085   days,  com- 
menced prior  to  application  for  reference  but  terminated  prior  to 
the  completion  of  a  board  and  pending  its  investigation  and  report ; 
I  strike,  affecting  1000  employees,  whose  time  loss  was  38,000  days, 
commenced  prior  to  application  for  a  board  and  continued  after  the 
board  was  constituted  ;  2  strikes,  affecting  341  employees,  whose  time 
loss  was  65,205  days,  commenced  after  the  application  for  a  board 
but  before  its  report;   5  strikes,  affecting  11,275  employees,  whose 
time  loss  was  496,874  days,  commenced  after  the  investigation  and 
report  of  a  board ;  in  i  strike,  affecting  1400  employees,  whose  time 
loss  was  28,000  days,  a  board  was  applied  for  but  not  constituted. 
Of  the  disputes  not  resulting  in  strike  or  lockout  in  which  applica- 
tion was  made  for  reference,  76,  affecting  93,200  employees,  were 
railway  disputes.    Of  this  number,  23  disputes,  affecting  29,843  em- 
ployees, were  adjusted  before  a  board  was  constituted. 


796       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


OPERATION  OF  ACT  AS  BETWEEN  SUCCESSIVE  PERIODS 

The  period  March  22,  1907,  to  December  31,  1916,  may  be  con- 
veniently divided  into  two  periods  of  approximately  five  years  each. 
Whether  there  were  fewer  or  more  disputes  resulting  in  strike  or  lock- 
out, or  in  which  the  intent  to  take  such  action  was  declared,  in  one 
period  than  in  the  other  is  not  in  itself  conclusive.  It  might  be 
expected,  however,  that  greater  familiarity  with  the  purpose,  scope, 
and  operation  of  the  act  would  lead  to  its  application  in  a  greater 
percentage  of  disputes  arising  in  industries  within  its  scope.  It  might 
also  be  expected  that  with  the  greater  undesirability  of  interruption 
to  industry  arising  out  of  participation  in  the  European  conflict  the 
relative  importance  of  a  governmental  agency  for  the  adjudication  of 
labor  disputes  would  be  augmented.  It  should  be  fruitful,  there- 
fore, to  compare  the  periods  1907-1911  and  1912-1916  as  to  the 
ratio  of  disputes  referred  and  disputes  within  the  scope  of  the  Indus- 
trial Disputes  Investigation  Act. 

During  the  period  March  22,  1907,  to  December  31,  1911,  there 
were  118  strikes  and  lockouts,  affecting  62,344  employees,  whose 
time  loss  was  3,620,346  working-days,  in  industries  within  the  scope 
of  the  act.  For  the  same  period  there  were  92  statutory  declarations 
of  intent  to  strike  or  lock  out,  involving  70,175  employees,  but  in 
which  such  strike  or  lockout  did  not  occur.  During  the  period  Jan- 
uary I,  191 2,  to  December  31,  19 16,  there  were  104  strikes  and 
lockouts,  affecting  38,264  employees  and  occasioning  a  time  loss  of 
1,218,301  working-days,  and  81  statutory  declarations  of  intent  to 
strike  or  lock  out  not  resulting  in  such  action,  affecting  71,120  em- 
ployees, in  industries  within  the  scope  of  the  act. 

In  the  mining  industry  during  the  period  March  22,  1907,  to 
December  31,  191 1,  there  were  46  strikes  and  lockouts,  affecting 
36,028  employees,  whose  time  loss  was  2,906,859  working-days. 
For  the  same  period  there  were  27  statutory  declarations  of  intent 
to  strike,  involving  20,440  employees,  but  in  which  such  strike  or 
lockout  did  not  occur.  During  the  period  January  i,  191 2,  to  Decem- 
ber 31,  1916,  there  were  29  strikes  and  lockouts,  affecting  23,276 
employees  and  occasioning  a  time  loss  of  1,066,522  working-days, 
and  7  statutory  declarations  of  intent  to  strike  or  lock  out  not  result- 
ing in  such  action,  affecting  4230  employees. 


"1 


THE  INVESTIGATION  ACT  IN  CANADA  797 

In  the  operation  of  railways  during  the  first  period  there  were  30 
strikes  and  lockouts,  affecting  1 7,339  employees,  whose  time  loss 
was  640,035^  working-days,  and  44  statutory  declarations  of  intent 
to  strike  or  lock  out  not  resulting  in  such  action,  affecting  40,852  em- 
ployees During  the  second  period  there  were  32  strikes  and  lockouts, 
affecting  6848  employees,  whose  time  loss  was  84,099  working-days, 
and  32  statutory  declarations  of  intent  to  strike  or  lock  out,  involving 
«  u8  employees,  but  in  which  such  strike  or  lockout  did  not  occur. 

On  the  basis  of  the  above  it  would  appear  that  the  act  was  suc- 
cessful in  avoiding  unrest  in  that  fewer  disputes  occurred  during  the 
second  five  years  of  operation  than  during  the  first  five  years  As 
stated  previously,  however,  there  is  no  way  of  determining  how 
many  disputes  might  have  occurred  but  for  the  operation  of  the  act. 
A  better  measure  of  effectiveness  will  be  found  in  the  relative  pro- 
portion of  .disputes  within  the  scope  of  the  act  to  disputes  referred 
under  the  act  during  the  two  periods. 

From  the  inception  of  the  act  until  December  31,  19",  boards 
were  constituted  for  22.9  per  cent  of  strikes  and  lockouts  in  indus- 
tries within  the  scope  of  the  act,  for  56.5  per  cent  of  the  employees 
affected  and  for  93.7  per  cent  of  the  working-days  lost  in  such  strikes 
and  lockouts,  as  against  ii.S  per  cent  of  the  strikes  and  lockouts  12.9 
per  cent  of  the  employees  affected,  and  18.5  per  cent  of  the  working- 
days  lost  during  the  period  January  i,  1912,  to  December  31,  1916. 
Of  statutory  declarations  of  intent  to  strike  or  lock  out  in  industries 
within  the  scope  of  the  act,  boards  were  constituted  for  36.2  per  cent 
of  the  disputes  and  for  45-8  per  cent  of  employees  affected  during 
the  first  period  as  against  33  per  cent  of  the  disputes  and  42^5 
per  cent  of  the  employees  affected  during  the  second  period.   Of 
all  disputes  within  the  scope  of  the  act,  boards  were  constituted  for 
49  T  per  cent  during  the  first  period  and  for  39S  per  cent  during 
the  second  period.   Of  all  employees  affected  in  disputes  within  the 
scope  of  the  act,  boards  were  constituted  for  724  per  cent  during 
the  first  period  as  against  47  per  cent  during  the  second  period. 
Relatively,  then,  a  much  smaller  percentage  of  disputes  within  the 
scope  of  the  act  were  referred  to  boards  during  the  period  1912- 
1916  than  during  the  period  1907-1911- 

including  44,000  days  lost  in  ,912  on  account  of  a  strike  which  began  and 
was  referred  under  the  act  prior  to  1912. 


tl.! 


1 


798       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

A  similar  analysis  of  disputes  in  the  mining  industry  shows  that  of 
all  mining  disputes,  boards  were  constituted  for  56.2  per  cent  during 
the  first  period  as  against  30.5  per  cent  during  the  second  period, 
and  for  69.2  per  cent  of  the  employees  affected  as  against  23.3  per 
cent.  If  only  strikes  and  lockouts  are  considered,  the  per  cent  is 
39.1  as  against  17.2  for  such  strikes  and  lockouts;  57.5  as  against 
8.3  for  employees  affected;  and  96.8  as  against  16.8  for  working- 
days  lost. 

The  act  is  conceded  to  have  been  most  successful  in  its  application 
to  railway  disputes,  yet  boards  were  constituted  for  55.3  per  cent 
of  the  railway  disputes  during  the  first  period  as  against  36  per  cent 
during  the  second  period,  and  for  78.9  per  cent  of  the  employees 
affected  as  against  52.7  per  cent.  Of  all  railway  strikes  and  lock- 
outs, boards  were  constituted  for  23.4  per  cent  during  the  period 
1907-1911  as  against  12.5  per  cent  during  the  period  1912-1916; 
for  71.2  per  cent  of  the  employees  affected  as  against  20.7  per  cent ; 
and  for  87.7  per  cent  of  the  working-days  lost  as  against  51.8  per 
cent. 

VIOLATIONS  OF  THE  ACT 

The  act  provides  that  in  designated  industries  "It  shall  be  unlaw- 
ful for  any  employer  to  declare  or  cause  a  lockout,  or  for  any  em- 
ployee to  go  on  strike  on  account  of  any  dispute  prior  to  or  during 
a  reference  of  such  dispute  to  a  board  of  conciliation  and  investiga- 
tion .  .  ."^;  that  "Any  employer  declaring  or  causing  a  lockout 
contrary  to  the  provisions  of  this  act  shall  be  liable  to  a  fine  of  not 
less  than  $100  nor  more  than  $1000  for  each  day  or  part  of  a  day 
that  such  lockout  exists "^ ;  that  "Any  employee  who  goes  on  strike 
contrary  to  the  provisions  of  this  act  shall  be  liable  to  a  fine  of  not 
less  than  $10  nor  more  than  $50  for  each  day  or  part  of  a  day  that 
such  employee  is  on  strike"^;  and  that  "Any  person  who  incites, 
encourages,  or  aids  in  any  manner  any  employer  to  declare  or  con- 
tinue a  lockout  or  any  employee  to  go  or  continue  on  strike  contrary 
to  the  provisions  of  this  act  shall  be  guilty  of  an  offense  and  liable 
to  a  fine  of  not  less  than  $50  nor  more  than  $1000."* 


THE  INVESTIGATION  ACT  IN  CANADA 


799 


1  Canadian  Industrial  Disputes  Act,  Section  56. 
^Ibid.  Section  58. 


^Ibid.  Section  59. 
^Ibid.  Section  60. 


•W.  fo  measure  the  influence  of  the  penal  provis  ons 
It  is  impossible  to  measure  j,j     „    interrupting 

in  restraining  employers  ^^^  emP  "V^e^    ;„„    a  comparison,  how- 
industry,  or  others  from  inciting  ^"<^h  acum  P  ^^^^ 

ever,  of  violations  with  P--;^~;,^^^^^^^^^^^  to  them, 

to  enforce  these  P-v-ons  ami  the  mpo^  ^^^^^  ^  ^,^,^ 

During  the  period  Mar  h  23   190  ,  ^^^^^^^^^  ^^^^, 

previously,  there  were  204  7^f  J'"    „,,  344  working-days.   Of 
L,278  employees,  whose  time  los   -    3^^^^^  ^^  ,„d 

zr^:::^:^  ^<>^'^^  ^- '--  - "''"°  ""• 

were  in  railways.  observed  that  of  all  strikes  and 

Expressed  -l^^^'^^^'^J^X!^,;^^^^,  act,  ,^.9  per  cent  of 

lockouts  in  industries  ^*^ V^^. '^°P' °    ^^  ^ent  of  the  employees 

such  strikes  and  lockouts,  "^^^  f /i^;^!^^  fflegal.   Mining 

and  occasioning  6a.3  per  ^;-l^  .^^^^^^  ^d  lockouts,  63.6  per 

contributed  31.9  Per  cent  of  '^^'ff^  „f  the  working-days 

cent  of  the  employees  affected,  and  88.1  per  ce 

lost  in  illegal  strikes  and  1°^^°"^^^.  J^^'^^f  g'  ^  ,ent  of  the  em- 
cent  of  the  illegal  strikes  and  '°''^°2' ZruS  ime  lost  in  illegal 
ployees  affected  and  4.  per  c^n   o   th^  wo  lung  ^^^^^ 

strikes  and  -f "  .  .^^i™" „f  occasioning  66.9  per  cent  of  the 
86.1  per  cent  of  ^'"'''"f J^'^^^,  Qf  all  railway  strikes,  9^.9  per 
time  lost  in  mimng,  ''^j;  '"f  J'^y      ^.ji^^y  employees  and  occa- 

cent,  affecting  534  f  .^^"'^^^^itTin  railways,  were  illegal, 
sioning  314  per  cent  of  *e   me  'o  ^  ^.^^^^^^ 

Of  the  total  number  "'jf^^iJ^f^:,  3,0  days,  must  be  consid- 
atfecting  95  employees,  whose  t""^ J°^"J^'^^,  ^  '^iu  be  observed 
ered  lockouts.  Assuming  the  ™«~J™;,  ^een  imposed  ex- 
that  the  aggregate  ol^f-^^^^'^^^S^  I  assumed,  the  amount 
ceeds  $30,000,000.   If  *e  «™     P  ^^  ^^^  ^ 

exceeds  $150,000,000.   This  does  not  .^     ^^^^^^^ 

0,  section  ^°.;;jt -kV^ri  SSonf  of  L  section. 

that  m  every  Illegal  St  kettle  ^^^^^  ^^^  ^^  ^^^^ 

A  comparison  of   illegal  strikes   a  ^^ 

March  22,  1907,  to  December  31,  J",  a^  J       ^^^^ 
December  ,r,  x9'6,  shows  that  for  the  ^-t  p^^ nod  9    7^P       ^^  ^^^  ^^^ 
strikes  and  lockouts  occurring  m  industries  witn 


8oo       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

were  illegal,  as  against  93.3  per  cent  during  the  second  period.  The 
employees  affected  in  illegal  strikes  and  lockouts  constituted  71.2  per 
cent  of  employees  affected  in  all  strikes  and  lockouts  in  industries 
within  the  scope  of  the  act  during  the  first  period,  as  against  93.7  per 
cent  during  the  second  period.  The  working-days  lost  in  illegal  strikes 
and  lockouts  during  the  first  period  was  53.7  per  cent  of  the  time  lost 
in  strikes  and  lockouts  in  all  industries  within  the  scope  of  the  act,  as 
against  86.8  per  cent  in  the  second  period.  A  similar  analysis  for 
mining  shows  that  of  all  mining  strikes  and  lockouts  during  the  first 
period,  84.8  per  cent  of  such  strikes  and  lockouts,  affecting  82  per 
cent  of  the  employees  and  occasioning  60.2  per  cent  of  the  time 
loss,  were  illegal,  as  against  89.7  per  cent  of  mining  strikes  and 
lockouts,  affecting  92.5  per  cent  of  the  employees  and  occasioning 
85.1  per  cent  of  the  time  loss,  during  the  second  period.  In  railways, 
90  per  cent  of  the  strikes  and  lockouts,  affecting  37.2  per  cent  of  the 
employees  and  occasioning  17,5  per  cent  of  the  time  loss,  were  illegal 
during  the  first  period,  as  against  93.7  per  cent  of  the  strikes  and 
lockouts,  affecting  94.5  per  cent  of  the  employees  and  occasioning 
95.8  per  cent  of  the  time  loss,  during  the  second  period. 


PROSECUTIONS  UNDER  THE  ACT 

During  the  period  March  22,  1907,  to  December  31,  1916,  there 
were  11  prosecutions  for  alleged  violations  of  the  act.'  Of  these,  i 
was  to  test  the  constitutionality  of  the  act  and  to  restrain  a  board 
of  conciliation  and  investigation  from  proceeding ;  i  was  to  enforce 
an  agreement  entered  into  as  a  consequence  of  the  recommendations 
of  a  board  ;  7  were  prosecutions  for  illegal  strikes  or  for  inciting  such 
action ;  2  were  for  illegal  lockouts.  In  all,  charges  have  been  laid 
against  9  employees  for  violating  the  provisions  of  Section  60  by  the 
encouragement  of  strikes  and  against  11  employees  for  violating  the 
provisions  of  Section  56  by  going  on  strike  illegally.  Charges  have 
been  laid  against  3  employers  for  violating  the  provisions  of  Section 
56  by  illegal  lockouts.  In  the  case  of  11  employees  the  charge  was 
either  dismissed  or  withdrawn  ;  in  the  case  of  9  employees  the  charge 
was  sustained.  Charges  against  2  employers  were  sustained  ;  charges 
against  i  employer  were  dismissed.  The  aggregate  of  fines  imposed, 
exclusive  of  costs,  was  $1660. 


5 


THE  INVESTIGATION  ACT  IN  CANADA 

CONCLUSION 


801 


It  may  be  repeated  that  the  chief  interest  in  the  Canadian  Indus- 
trial Disputes  Investigation  Act  is  not  in  its  administration  as  a 
conciliatory  measure  but  in  those  restrictive  provisions  wnich  have 
served  to  characterize  it  as  the  Compulsory  Investigation  Act.  It 
is  clear  that  the  provisions  have  not  been  enforced;  that  continued 
administration  of  the  act  has  been  accompanied  by  an  increase  in 
the  percentage  of  illegal  strikes  and  lockouts  and  by  a  decrease  in 
the  percentage  of  disputes  within  the  scope  of  the  act  m  which  he 
act  was  applied.  The  question  naturally  arises  as  to  the  value  of  the 
restrictive  provisions  if  they  are  not  enforced.  The  answer  to  this 
must  be  sought  in  the  spirit  of  the  act,  its  administration,  and  its 

violation.  •  ^     j  j  ♦« 

Obviously,  the  restrictive  provisions  of  the  act  were  intended  to 
avoid  interruption   to  industries  intimately  related  to   the  publ.c 
well-being.   True,  the  ultimate  right  to  strike  or  lock  out  was  not 
denied,  and  in  this  respect  the  act  may  be  said  to  recognize  such 
right  subject  to  limitations  and  thus  to  differ  from  legislation  that 
prohibits  absolutely  the  right  to  strike  or  lock  out.   In  underlying 
principle,  however,  there  is  little  difference.    Both  are  predicated  on 
the  principle  that  private  rights  cease  when  they  become  pub  he 
wrongs.   Although  the  wrong  is  undoubtedly  greater  whenit  results 
from  ill-advised  or  precipitate  interruption  to  industries  whose  con- 
tinuous operation  is  vital  to  public  welfare,  it  is  not  clear  that  the 
wrong  would  be  wholly  lacking  even  though  a  strike  or  lockout  did 
not  occur  in  these  industries  until  such  action  was  legally  permissible. 
The  act  was  written  after  a  prolonged  coal  strike  had  seriously 
interfered  with  public  well-being  and  had  focused  attention  upon 
the  dangers  of  a  prolonged  industrial  warfare  in  this  and  other 
industries  in  which  the  public  is  largely  concerned.   It  was  written 
by  a  Pariiament  in  which  the  conservative  element  predominated. 
The  previous  experience  in  Canada  with  the  Conciliation  and  Labor 
Act  and  with  the  Railway  Labor  Disputes  Act  and  the  experience  in 
other  countries,  particulariy   Australia,  undoubtedly  exercised   no 
little  influence  in  determining  the  character  of  the  act  of  1907. 

Experience  in  Australia  had  shown  that  absolute  prohibition  of 
Strikes  and  lockouts  was  difficult  to  enforce.  It  is  probable  that  the 


III   ■! 


8o2       TRADE  UNlOxMISM  AND  LABOR  PROBLEMS 

framers  of  the  Canadian  act  recognized  this  and  sought  to  avoid  the 
difficulty  by  limiting  the  act  to  industries  in  which  the  public  had 
an  immediate  interest  and  by  imposing  in  these  industries  only  tem- 
porary restriction,  that  the  full  force  of  public  opinion  might  be 
brought  to  bear  upon  precipitate  action. 

Certain  other  provisions  indicate  that  the  Australian  experience 
was  in  mind.  Thus  the  Canadian  act  provides  that  only  those 
disputes  may  come  before  a  board  in  which,  "  failing  an  adjustment 
of  the  dispute  or  a  reference  thereof  by  the  minister  to  a  board, 
...  a  lockout  or  strike  will  be  declared  ...  and  that  the  neces- 
sary authority  to  declare  such  lockout  or  strike  has  been  obtained." 
The  purpose  of  these  provisions  was,  on  the  one  hand,  to  prevent 
a  multiplicity  of  trivial  cases'  clogging  the  administrative  machinery 
and  perhaps  giving  a  serious  aspect  to  disputes  capable  of  self- 
adjustment  and,  on  the  other  hand,— recalling  that  the  act  was 
written  by  a  conservative  Parliament  in  which  the  working  classes 
had  little  representation,— to  limit  the  encouragement  to  organiza- 
tion arising  inevitably  from  government  arbitration. 

On  the  first  of  these  points— restricting  the  application  of  the  act 
to  the  more  serious  disputes— it  may  be  remarked  that  the  required 
statutory  declaration  of  intent  to  strike  or  lock  out  may  come  to  be 
merely  perfunctory.  If  authority  to  declare  a  strike  or  lockout  is 
necessary  before  a  dispute  may  be  referred  under  the  act,  it  is  appar- 
ent that  the  granting  of  such  authority  may  be  looked  upon  simply 
as  a  formality.  It  has  been  shown  elsewhere  in  this  report  that  a 
considerable  number  of  such  declarations  did  not  result  in  strike  or 
lockout,  even  though  boards  were  not  created. 

On  the  second  point^ — limiting  government  encouragement  of  or- 
ganization—little can  be  said  in  its  support  without  attacking  the 
principle  of  government  intervention  and  denying  the  value  of  labor 
organization.  Certainly  a  board  of  investigation  or  arbitration  must 
deal  with  representatives  of  employees,  and  this  in  itself  implies 
collective  action  through  organization.  During  the  proceedings  be- 
fore such  a  board  it  is  often  necessary  that  employers  meet  and 
discuss  differences  with  representatives  of  labor.  But  while  com- 
pulsory investigation  or  arbitration  makes  organization  of  employees 
necessary  and  leads  indirectly  to  the  recognition  of  officials  of  these 
organizations  by  employers,  it  tends,  in  some  cases  at  least,  toward 


THE  INVESTIGATION  ACT  IN  CANADA 


803 


the  establishment  of  more  cordial  relations  between  employers  and 
union  officials  and  the  forming  of  the  habit  of  negotiation  which  may 
conceivably  increase  the  number  of  self-adjustments.  To  limit  the 
scope  of  government  intervention  on  the  ground  that  it  encourages 
the  growth  of  unions  is,  after  all,  but  to  deny  the  right  of  men  to 
organize  and  to  deal  collectively. 

One  other  feature  of  the  act  should  be  mentioned  because  of  its 
effect  upon  the  administration  of  the  act.    No  permanent  board  of 
conciliation  and  investigation  is  provided.    For  each  dispute  a  new 
board  is  created.    Upon  filing  its  report  with  the  Minister  of  Labor 
the  board  ceases  to  exist.    This  lack  of  a  permanent  board  undoubt- 
edly has  advantages  and  disadvantages.    It  avoids  the  lasting  dis- 
credit of  an  unsatisfactory  decision.    If,  in  the  opinion  of  either  side, 
one  board  fails,  there  is  always  the  chance  of  a  better  deal  next  time 
with  a  different  board.    Moreover,  there  is  a  feeling  of  direct  rep- 
resentation of  interests  when  each  side  to  a  dispute  has  the  oppor- 
tunity of  naming  a  member  of  the  board.  On  the  other  hand,  however, 
there  is   always  more  or   less   delay   in  creating   and   assembling 
a  board  and  for  the  board  to  get  acquainted  with  the  routine  of 
procedure.    Many  disputes  are  of  such  a  nature  that  only  quick 
action  will  avert  a  strike  or  lockout.    This  is  possible  only  with  a 
permanent  body  ready  for  action.    Then,  too,  conciliation  calls  for 
a  large  degree  of  skill  in  dealing  with  industrial  disputes.    A  tem- 
porary board  cannot  be  expected  to  handle  disputants  as  tactfully 
as  a  permanent  and  more  experienced  board. 

The  absence  of  a  permanent  board  gives  rise  to  another  disadvan- 
tage in  attempting  to  carry  out  a  decision.  It  is  seldom  that  a  wage 
award  or  a  set  of  working  conditions  can  be  put  into  effect  without 
numerous  questions'  coming  up  respecting  interpretation.  Charges 
of  deliberate  violation  of  the  terms  of  the  agreement  are  often  made 
and  delays  in  securing  official  interpretation  may  aggravate  the  sit- 
uation to  a  point  where  a  strike  or  lockout  occurs  even  though  the 
parties  have  previously  signified  a  willingness  to  accept  the  decision. 
In  this  it  must  be  borne  in  mind  that  the  decisions  of  Canadian 
boards  of  investigation  are  not  binding  upon  the  parties  to  the  dis- 
putes, and  it  is  therefore  necessary  to  secure  compliance  through 
the  pressure  of  public  opinion  or  by  leading  the  parties  themselves 
to  believe  in  the  fairness  of  the  decision. 


lit 


« 


d 


804       TRADE  UNIONISM  AxND  LABOR  PROBLEiMS 

Labor's  attitude  toward  any  limitation  of  the  right  to  strike  is 
well-known.  Strikes  are  opportunistic  and  are  looked  upon  as  born 
of  necessity.  If  the  right  to  strike  or  to  strike  at  an  opportune  time 
is  taken  away,  then  labor  must  be  assured  that  its  just  demands  will 
be  met  in  some  other  way.  Labor  is  not  ready,  however,  to  leave 
wages  and  working  conditions  entirely  in  the  hands  of  government 
boards  of  arbitration.  Although  not  opposed  to  compulsory  inves- 
tigation, labor  objects  to  the  provisions  in  the  Canadian  act  that 
restrict  the  right  to  strike.  There  is  some  justification  for  this  atti- 
tude. The  absence  of  any  well-defined  and  acceptable  standards  to 
be  used  in  wage  determination  has  forced  arbitrators  to  resort  in 
many  cases  to  the  expediency  of  "splitting  the  difference"  or  of 
giving  the  parties  what  they  are  most  likely  to  accept  without  a 
strike  or  a  lockout.  As  a  consequence  the  workers  feel  that  they  are 
confronted  with  the  same  proposition  in  arbitration  as  in  direct 
negotiations  with  their  employers  and  must  not  only  "ask  enough 
to  make  it  worth  while  to  arbitrate"  but  perhaps  in  the  end  rely 
upon  their  own  strength.  The  dissatisfaction  with  arbitration  is 
always  aggravated  by  delays  in  securing  decisions  or  compliance 
therewith,  during  which  time  the  employer  can  prepare  for  a  strike 
and  much  of  the  effectiveness  of  precipitate  action  is  lost.  Thus 
while  some  of  the  illegal  strikes  in  Canadian  industries  have  un- 
doubtedly been  due  to  ignorance  or  carelessness,  the  greater  number 
have  occurred  because  the  workers  felt  that  an  opportune  strike 
was  the  most  effective  way  of  securing  their  demands. 

A  restriction  upon  the  right  to  strike  or  lock  out  pending  an  in- 
vestigation by  a  government  board  as  provided  in  the  Canadian  act 
is  generally  favored  by  employers  because  it  enables  them  to  con- 
tinue operation  and  to  prepare  for  the  possible  contingency  of  a  strike 
and  does  not  force  them  to  accept  the  findings  of  such  a  board.  If 
the  form  of  such  legislation  is  changed  to  a  compulsory  acceptance  of 
findings,  employers  are  as  apt  as  employees  to  take  exception  to 
adverse  decisions.  Employers  are  seldom  violators  of  the  Canadian 
act  in  the  sense  of  declaring  an  illegal  lockout.  For  that  matter  a 
lockout  at  any  time  is  exceedingly  rare.  But  it  should  be  borne  in 
mind  that  the  distinction  between  a  strike  and  a  lockout  is  not  clear- 
cut.  By  a  refusal  to  meet  demands  or  to  accept  the  findings  of  a 
legally   constituted   government   board   the   employer   may   impose 


THE  INVESTIGATION  ACT  IN  CANADA 


805 


n 


conditions  which,  though  resulting  in  a  strike,  nevertheless  consti- 
tute a  lockout  as  effectually  as  though  the  doors  of  his  establish- 
ment were  closed  against  his  employees. 

In  any  antistrike  or  lockout  legislation  it  is  necessary  with  both 
employers  and  employees  to  meet  the  objection  to  what  is  regarded  as 
a  curtailment  of  rights  and  privileges.  Employers  have  the  advan- 
tage in  that  they  have  been  subject  to  a  greater  amount  of  govern- 
mental regulation  than  have  workers.  But  if  either  employers  or 
employees  are  to  be  brought  to  the  point  of  voluntarily  accepting 
arbitration  as  a  substitute  for  direct  action,  there  must  be  some 
assurance  that  the  underlying  principle  of  arbitration  is  not  merely  a 
restatement  of  the  law  of  supply  and  demand,  which  in  the  final 
analysis  concedes  the  demands  of  the  stronger  party. 

Much  has  been  written  of  the  emphasis  placed  upon  public  opinion 
in  averting  strikes  and  lockouts  and  in  bringing  about  compliance 
with  decisions.    Because  of  the  provision  in  the  Canadian  act  that 
the  proceedings  and  findings  of  boards  of  conciliation  and  investiga- 
tion shall  be  made  public,  the  act  has  been  jestingly  called  the 
"parade  law."    There  is  much  to  be  said,  however,  in  favor  of  an 
enlightened  public  opinion  in  dealing  with  industrial  disputes.    The 
contending  parties  are  much  more  apt  to  be  temperate  in  their 
attitude  if  they  know  that  the  public  is  to  be  kept  informed  about 
the  dispute.    This  in  itself  will  tend  to   avoid  precipitate  action 
and  unreasonable  demands  and,  irrespective  of  their  relative  strength, 
will  incline  the  parties  toward  the  acceptance  of  a  compromise  that 
approaches  a  fair  settlement.    In  the  absence  of  practical  means  of 
government  enforcement  public  opinion  will  go  a  long  way  toward 
making  restrictive  legislation  effective.   That  the  public  has  viewed 
repeated  violations  of  the  restrictive  provisions  of  the  Canadian  act 
with  little  concern,  however,  discredits  the  conclusion  that  those  who 
observe  the  provisions  do  so  because  they  fear  the  public  will  condemn 
infringements  per  se.    Public  interest  is  most  keen  when  inconven- 
ience is  threatened  or  occasioned,  and  it  is  unlikely  that  a  public 
would  view  complacently  a  strike  or  lockout,  whether  legal  or  illegal, 
that  proved  to  be  an  actual  menace  to  any  large  number  of  people. 

In  the  administration  of  the  Canadian  act  emphasis  has  been 
placed  upon  conciliation  and  mediation  rather  than  upon  compulsion. 
The  Department  of  Labor  endeavors  to  keep  in  touch  with  industrial 


i 


m 


:  fc 


i^ 


806       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

controversies,  to  warn  disputants  of  the  penalties  provided  for  illegal 
strikes  and  lockouts,  and  to  encourage  a  continuance  or  a  resump- 
tion of  negotiations  or  an  application  for  reference  under  the  act. 
No  one,  it  may  be  observed,  is  specifically  charged  with  enforcing 
the  restrictive  provisions,  and  it  rests  with  the  parties  themselves 
or  with  the  public  to  prefer  charges. 

With  reference  to  violations  of  the  restrictive  provisions  the 
Deputy  Minister  of  Labor  has  previously  been  quoted  as  saying  that 
"  It  has  not  been  the  policy  of  the  successive  ministers  under  whose 
authority  the  statute  has  been  administered  to  undertake  the  enforce- 
ment of  these  provisions."^  In  his  opinion,  ''The  usefulness  of  the 
act  is  better  determined,  in  any  event,  less  by  the  negative  results 
in  situations  where  the  parties  have,  regardless  of  consequences, 
stayed  deliberately  aloof  from  its  influences  and  operation  than  by 
the  positive  results  obtained  in  situations  where  the  parties  con- 
cerned have,  whether  cordially  or  reluctantly,  brought  their  differ- 
ences within  the  scope  of  the  act."^ 

It  may  be  expected  that  either  party  to  a  dispute  will  be  quick 
to  avail  itself  of  the  act  if  it  does  not  feel  strong  enough  to  make 
certain  the  success  of  direct  action.  It  may  be  repeated,  too,  that 
the  act  is  most  apt  to  be  invoked  in  disputes  in  those  industries 
where  collective  bargaining  has  become  an  established  fact.  A 
mutual  agreement  either  to  arbitrate  or  to  negotiate  implies  that 
each  party  to  the  dispute  has  a  respect  for  the  strength  of  the  other. 
But  if  either  side  feels  itself  in  a  more  strategic  position  than  the 
other,  or  if  the  issues  involved  are  not  those  with  which  the  public 
is  generally  sympathetic,  the  restrictive  provisions  will  be  of  little 
value  unless  some  attempt  is  made  to  impose  the  penalties  provided 
for  violation.  Moreover,  repeated  violations  of  these  provisions 
must  inevitably  reflect  upon  their  enforceability  and  foster  such  a 
disregard  for  the  act  as  to  lessen  its  usefulness  even  as  a  concilia- 
tory measure. 

B.  M.  Squires 

United  States  Department  of  Labor 

iR  782. 

^Labor  Gazette,  Canadian  Department  of  Labor,  April,  1916,  p.  1118. 


XLV 
EIGHT-HOUR  SHIFTS  BY  FEDERAL  LEGISLATION^ 

THERE  is  one  thing  that  separates  continuous  industries  from 
all  other  industries  and  gives  them  a  distinct  classification  and 
a  peculiar  claim  for  legislation.  In  a  continuous  process  there  can 
be  no  gradual  reduction  in  hours  of  labor.  Employees  must  work 
either  two  shifts  of  twelve  hours  or  three  shifts  of  eight  hours. 
There  is  no  middle  ground.  It  is  impossible  to  reduce  the  hours 
gradually,  say,  from  twelve  to  eleven,  then  to  ten,  then  to  eight,  but 
they  must  be  reduced  abruptly  from  twelve  to  eight. 

This  sudden  change  in  length  of  the  day's  work  requires  that 
these  industries  be  treated  in  a  class  by  themselves  and  not  confused 
with  other  industries.  Arguments  which  hold  good  for  a  gradual 
reduction  of  hours  may  have  little  or  no  place  in  an  industrial  proc- 
ess which  can  be  improved  only  by  an  almost  revolutionary  reduc- 
tion of  hours. 

First,  for  instance,  there  is  the  argument  of  increased  efficiency 
oLJaboJLJvhen^  working  shorter  hours.  No  amount  of  investigation 
whatever  can  give  to  this  argument  any  greater  weight  than  it  has 
without  investigation.  We  know  by  mere  arithmetic  that  to  reduce 
hours  from  twelve  to  eight  means  a  reduction  of  33^^  per  cent  in 
hours,  and  that  in  order  to  produce  as  much  in  eight  hours  as  in 
twelve  efficiency  must  be  increased  50  per  cent. 

Furthermore,  since  these  industries  often  work  their  employees 
seven  days  a  week,  or  a  limit  of  eighty-four  hours  a  week,  we  know 
that  a  reduction  from  eighty-four  to  forty-eight  hours  a  week  is  a 
reduction  of  43  per  cent  in  hours  and  that  for  a  man  to  produce 
as  much  in  a  week  of  forty-eight  hours  as  in  a  week  of  eighty-four 
hours  would  require  an  increased  efficiency  of  about  75  per  cent. 
No  amount  of  investigation  can  conclusively  show  in  all  continuous 
industries  that  a  man's  efficiency  can  be  increased  50  to  75  per  cent 

iFrom  American  Labor  Legislation  Review,  Vol.  VII  (i9i7)>  PP-  i39-iS4. 

807 


.11 


H 


808       TRADE  UNIONISM  AND  LAHOR  PROBLExMS 

by  merely  reducing  his  hours  of  labor  30  to  43  per  cent.  Jt  m^ay, 
perhaps^  be  shown  in  some  industries ;  and  there  is  reason  to  believe 
that  in  the  manufacture  of  paper,  which  is  now  largely  on  the 
three-shift  system,  the  men  are  turning  out  as  much  paper  in  eight 
hours  as  they  formerly  did  in  twelve  hours.  In  this  process  the 
amount  of  output  seems  to  turn  upon  the  watchfulness  and  close 
attention  which  the  machine  tender  is  able  to  devote  to  the  huge 
machine  that  pours  out  miles  of  paper  when  running  correctly  or 
balls  up  rubbish  when  it  gets  out  of  order.  The  machine  might  run 
smoothly  for  several  hours  and  the  man  might  sleep  or  doze,  but 
experience  seems  to  show  that  an  eight-hour  day  without  fatigue 
is  about  equal  to  a  twelve-hour  day  half  asleep  the  last  four  hours. 
This  seems  to  be  borne  out  by  the  fact  that  twelve-hour  mills  and 
eight-hour  mills  have  been  and  still  are  competing  with  each  other. 

Yet  even  in  this  case  the  evidence  is  not  conclusive,  for  the  wages 
per  day  on  some  positions  may  have  been  reduced  when  the  change 
was  made  and  the  low  cost  of  labor  to  the  employer  on  the  eight- 
hour  system  may  have  been  secured  partly  by  the  lower  wages  per 
day  and  partly  by  the  larger  output.  In_othe_r  industries,  such  as 
iron  and  steel,  the  work  is  already  speeded  up  to  the  capacity  of  the 
equipment,  and  a  reduction  of  hours  from  twelve  to  eight  cannot  be 
shown  JLo  increase  the  efficiency  of  the  worker  the  necessary  50  per 
cent  to  offset  the  reduction. 

We  have,  indeed,  the  report  of  a  small  company  operating  three 
open-hearth  furnaces  to  the  effect  that  the  higher  efficiency  of  the 
eight-hour  system  brought  about  a  slight  decrease  in  the  cost  of 
production.  This  was  owing  in  part  to  greater  economy  of  raw 
material  used,  such  as  pig  iron  and  fuel  oil,  and  partly  to  improved 
quality  of  the  castings.  But  the  lower  cost  of  production  was  owing 
also  to  the  fact  that  the  hourly  rate  of  pay  was  increased  only  about 
20  per  cent.^  Had  the  hourly  rate  been  increased  50  per  cent,  in 
order  that  the  men  might  earn  as  much  in  eight  hours  as  they  had 
earned  in  twelve  hours,  the  cost  of  production  would  have  been 
increased  some  25  per  cent. 

But  there  is  another  circumstance  that  tends  to  increase  the  cost 
of  production  if  the  eight-hour  system  is  to  be  required  by  law. 

^Commonwealth  Steel  Company,  address  of  superintendent  before  Foundry- 
men's  Association,  igi2. 


EIGHT-HOUR  SHIFTS 


809 


Manufacturers  who  oppose  the  reduction  say  that  they  cannot  get 
enough  workmen  on  the  eight-hour  basis,  and  that  the  workmen 
prefer  to  work  twelve  hours ;  therefore  the  twelve-hour  competitors 
get  all  the  workmen  needed,  while  the  eight-hour  shops  are  short 

of  men. 

The  evident  answer  to  this  objection  is  that  workmen,  of  course, 

prefer  twelve  hours  when  they  can  make  more  money  than  they 
can  in  eight  hours.  The  reason  why  manufacturers  cannot  get 
enough  workmen  on  the  eight-hour  basis  is  that  they  do  not  pay  as 

^uch  wages  for  eight  hours  as  their  competitors  pay  for  twelve  hours. 
Of  course,  no  matter  how  high  the  wages,  there  are  always  men  who 
are  willing  to  work  overtime  for  more  money. 

One  of  the  reasons  given  for  overtime  is  that  in  a  continuous 
process  a  man  on  one  shift  cannot  leave  his  work  until  the  man 
for  the  next  shift  shows  up.  This  is  evident,  and  the  only  way  it  can 
be  met  and  overtime  prevented  is  to  have  enough  spare  hands  em- 
ployed to  jump  in  and  fill  the  gaps  when  the  regular  men  fail  to 

come  around. 

An  essential  thing,  therefore,  in  any  eight-hour  law  is  the  pro- 
hibition  of  overtime.  No  exceptions  whatever  should  be  allowed 
except,  perhaps,  in  case  of  accident,  and  these  exceptions  should  be 
strictly  limited  under  rules  and  regulations  carefully  laid  down  by  a 
board  created  for  the  purpose.  In  no  other  way  can  it  be  provided 
that  the  manufacturer  will  employ  enough  spare  hands  to  take  care 

of  emergencies. 

But  to  have  spare  hands  costs  more  money.  They  must  be  paid 
even  when  not  working,  or  when  working  at  less  important  jobs,  in 
order  to  be  on  hand  when  needed. 

Another  reason  for  increased  cost  of  the  eight-hour  system  when 
imposed  bv  law  is  in  the  matter  of  administration,  getting  evidence 
of  violations  and  enforcing  penalties  for  overtime.  In  order  to  make 
the  law  enforceable  the  eight-hour  system  cannot  be  limited  merely 
to  continuous  processes,  but  must  extend  to  all  occupations  m  the 
same  establishment.  It  would  be  almost  impossible  to  get  evidence 
of  violations  if  a  man  on  an  eight-hour  job  could  be  transferred  to 
other  work  when  he  finishes  his  eight-hour  task.  All  jobs  in  the 
same  establishment  must  be  reduced  to  eight  hours  in  order  to 
enforce  the  eight-hour  limit  on  the  continuous  jobs. 


;  i 


8io       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Consequently,  there  are  at  least  three  points  where  the  eight- 
hour  system,  if  enforced  by  law,  will  cost  the  employer  more  than 
the  twelve-hour  system.  He  must  pay  as  much  for  eight  hours  as 
other  employers  are  paying  for  twelve  hours  in  order  to  get  enough 
supply  of  labor.  He  must  employ  and  pay  spare  hands  in  order  to 
avoid  overtime  for  regular  hands.  And  the  eight-hour  system  must 
include  all  employees  in  the  shop  in  order  to  prevent  evasion. 

So  much  for  the  alleged  increase  in  efficiency  of  labor  to  be  ex- 
pected from  a  reduction  in  hours.  It  must  be  conceded  that  efficiency 
will  not  be  increased  enough  to  offset  the  decrease  in  hours  from 
twelve  to  eight. 

Second^jhfiie^^jhe  argumentfor  improved  health  of  the  worker 
when  WQilvins  shorter  hours^  I'his  argument  also  is  inconclusive  in 
continuous  industries.  Under  the  decision  of  the  United  States  Su- 
preme Court  the  bakery  business  is  not  so  unhealthful  as  to  make  a 
legislative  ten-hour  day  constitutional/  although  an  eight-hour  day 
by  law  is  constitutional  in  smelting  and  underground  mines.-  It 
seems  to  be  the  theor>'  of  the  Court,  as  it  is  also  the  theory  of  those 
who  oppose  the  universal  eight-hour  day,  that  industries  can  be 
classified  according  to  the  probable  injury  which  they  inflict  upon 
the  worker,  and  that  the  hours  of  labor  can  correspondingly  be 
adjusted  so  as  to  counteract  this  damage.  It  follows  that  in  light 
and  easy  occupations  the  reasonable  hours  of  labor  might  be  ten, 
twelve,  or  even  more  per  day,  but  in  the  heavy  and  exhausting 
occupations  they  might  constitutionally  be  reduced  to  eight  or  even 
less  per  day. 

But  in  the  cnntinnoii^  industries  this  juce  theory  of  compensation 
doesjiotjvork.  It  might  undoubtedly  be ThowiTthat 'eight  hours  is 
all  a  man  can  stand  when  operating  a  Bessemer  converter,  but  it 
can  plausibly  be  shown  that  he  can  stand  ten,  twelve,  or  thirteen 
hours  as  a  machine  tender  in  a  paper  mill,  or  a  heater  in  a  steel 
mill,  where  he  has  very  little  manual  work  and  merely  has  to  wait 
and  watch  while  the  machine  does  the  work.  If  the  health  argu- 
ment alone  is  depended  upon,  the  reduction  of  hours  in  continuous 
industries  could  be  brought  about  under  the  decisions  of  the  courts 
only  in  a  few  occupations  where  it  can  be  shown  that  more  than 

^Lochner  v.  New  York,  198  U.S.  45,  25  Sup.  Ct.  539  (1905). 
^Holden  v.  Hardy,  169  U.S.  366,  i8  Sup.  Ct.  383  (1898). 


EIGHT-HOUR  SHIFTS 


811 


eight  hours  is  excessive.  But  in  many  occupations  in  the  same 
industry,  from  the  standpoint  of  health  alone,  nine,  ten,  and  even 
eleven  hours  cannot  be  shown  to  be  excessive. 

Consequently^ 
hour  law  for  continuous  industries  comes  before  the  court,  other 
arguments  T>esides  thriiealth  argumenTmust^be  allowed  a  place^_0£ 
the  legislation  will  fall  under  the  judicial  veto. 
"^  These  aamtton^t-^rr^™™^^       b'e'^T^T^^med  up  under  the  head  of 

citizensMp. 

— ThelDeculiar  fact  about  a  continuous  industry^  compared^,  with 
^ncontinuous,  is   its   enormous   increase  in  Jhe^pjGoductiQn^ 

-— —  ,^gg-j^  ^,Qg^    T];iis  is  on  account  of  the 

tl^^etnyesTment  in  fixe'T  capTtalTsoThat  the^mcluaP,  mnrP  than 
the  man,  is  the  great  producer.  The  man  only  watches,  guides,  and 
7epairs  the  "macRine.  The  machine  even  feeds  itself  and  unloads 
itself,  and  the  man  only  touches  buttons  and  handles  levers.  The 
fixed  charges  for  interest  and  depreciation  on  these  great  invest^ 
ments  mighty  in  some  cases,  actually  exceed  Jhe.jffiase^oi3ie 
workers  if  thrinachlnes'-werE- T^peratecT' only  eight j)rJgaJ}p)ars  a 
day.  But  operafeiJ~COnt1nuousty  dayahd'mghl  seven  days  a  week, 
these  fixed  charges  go  down  in  comparison  with  wages  and  output  — 
in  other  words,  the  production  of  wealth  is  increased  enormously 
in  comparison  with  the  cost  of  production. 

To  whom,  then,  shall  this  increased  production  go?  Shall  it  go 
in^lparTTo  the  wage-earner  m  decreased  hours  without  reduction  in 
wages,  or  shall  it  go  to  the  consumer  in  reduction  in  prices?  The 
steel  industry  shows  us  where  it  goes.  Before  the  Homestead  strike 
of  1892  the  hours  of  labor  were  nine,  ten,  eleven,  or  twelve,  accord- 
ing to  the  time  the  man  required  to  finish  his  task.  Two  shifts  were 
all  that  could  be  used,  and  the  equipment  was  idle  as  much  as  four 
to  six  hours  or  more  out  of  the  twenty-four,  besides  the  expense  of 
stopping  and  starting.  The  union  of  iron  and  steel  workers  foolishly 
opposed  the  eight-hour  continuous  system,  against  the  protests  of 
their  own  leaders,  and  consequently  the  union  was  smashed.  After 
the  loss  of  the  strike  and  the  expulsion  of  unionism  the  continuous 
system  was  introduced  or  extended.  With  it  came  not  eight  hours 
in  three  shifts  but  twelve  hours  in  two  shifts,  wherever  by  any  in- 
genuity the  men  could  be  forced  to  stand  the  physical  strain  of  more 


I 


11 


r 


■  *c«ii..iii*-*'''-^ 


8i2       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

than  eight  hours.  The  story  has  been  told  by  Fitch  in  his  book  on 
the  steel  workers.  It  is  not  merely  the  health  of  the  employees  that 
is  affected,  for  the  industry  has  imported  or  used  the  sturdy  peasants 
and  farm  laborers  of  Europe.  But  it  is  the  homes,  the  wife  and 
children,  the  schools  and  libraries,  the  churches,  the  politics — in 
short,  the  citizenship,  that  has  suffered. 

We  might,  perhaps,  all  agree  that  a  man  could  work  comfortably 
and  healthfully  nine  or  ten  hours  in  the  steel  industry,  but  that  is  not 
the  question.  The  question  is  not  Are  ten  hours  excessive  ?  but  Are 
twelve  hours  excessive  ?  If  we  agree  that  twelve  hours  are  excessive, 
then  we  must  agree  that  eight  hours  are  the  only  reasonable  hours  in 
that  industry.  There  is  no  other  alternative.  And  we  cannot  agree 
that  twelve  hours  are  excessive  in  all  processes  if  we  base  the  argu- 
ment solely  on  health.  But  we  can  all  agree  that  twelve  hours  are 
excessive  if  the  worker  is  to  enjoy  the  privileges  and  observe  the 
duties  of  home,  family,  and  citizenship.  Indeed,  the  citizenship 
argument  cannot  be  separated  from  the  health  argument.  The 
health  argument  would  apply  to  animals  and  slaves  as  much  as  to 
men ;  the  citizenship  argument  applies  to  workmen  because  they  . 
are  present  and  prospective  citizens  of  the  republic. 

The  foregoing  considerations  make  it  evident  that  eight  hours  in 
continuous  industries  cannot  be  brought  about  by  state  legislation. 
Not  only  will  the  increased  cost  put  any  state  at  a  disadvantage  as 
against  competing  states  but  it  cannot  be  shown  that  simply  as  a 
health  measure  a  limit  of  eight  hours  is  necessary  for  adult  males. 
Only  federal  legislation  will  equalize  competition  and  permit  the 
argument  for  improved  citizenship  to  have  equal  weight  with  that 
for  improved  health.  Consequently  it  is  proposed  to  apply  the  law^ 
only  to  those  industries  engaged  in  interstate  and  foreign  commerce 
and  to  enact  the  law  through  the  federal  Congress  and  not  the  state 
legislatures.  The  proposed  law  does  not  apply  to  local  municipal 
utilities,  like  gas,  water,  or  street  cars,  nor  to  railways  and  other 
national  utilities.  It  applies  only  to  industries  that  are  subject  to 
interstate  and  foreign  competition. 

In  the  hearings  before  the  Massachusetts  Commission  of   191 6 
assigned  to  investigate  this  subject,  certain  paper  manufacturers, 
while  opposing  state  legislation,  conceded  that  their  objections  would 
^For  tentative  draft  of  proposed  bill  see  page  821. 


] 


EIGHT-HOUR  SHIFTS 


813 


not  hold  against  federal  legislation.  And  this  for  two  reasons :  federal 
legislation  would  place  them  on  an  equality  with  competitors  in  other 
states,  and  the   federal  tariff  could  protect  them  against  .foreign 

competition. 

Whatever  may  be  said  about  interstate  competition  in  those  m- 
dustries  where  a  gradual  reduction  of  hours  is  possible,  or  where  the 
reduction  is  only  from  nine  or  ten  hours  to  eight  hours,  it  cannot 
be  shown  that  any  state  can  afford  to  take  the  lead  in  reducing  hours 
abruptly  from  twelve  to  eight.  Manufacturers  in  one  state  might 
work  eight  hours  in  competition  with  others  working  nine  or  ten 
hours,  but  they  cannot  generally  compete  with  those  working  twelve 
hours.  And,  since  there  is  no  middle  ground,  itis.i2nliL,b^JederaI 
legislation  thatcontinuous  industries  may  be  brought  to  Jhe^ei^ 

Tiour  basis. 

^■"TEThTorher  hand,  it  may  now  be  accepted  that  the  policy  of  a 
protective  tariff  is  approved  by  both  political  parties  to  the  extent, 
at  least,  of  the  difference  in  the  labor  cost  of  production  in  this 
and  in  competing  foreign  countries.    Even  the  traditional  free-trade 
party,  when  it  recently  came  into  power,  restored  the  Tariff  Commis- 
sion, whose  most  important  duty  is  this  very  problem  of  ascertaining 
how'high  the  tariff  duties  should  be  placed  in  order  to  ward  off  foreign 
competition.    It  may  be  accepted,  then,  that  for  the  future  no  tariff 
schedules  will  be  reduced  so  low  that  an  American  industry  on  the 
eight-hour  basis  will  not  be  able  to  compete,  at  least  in  the  home 
market,  with  foreigners  on  a  twelve-hour  basis.    There  will  undoubt- 
edly be  differences  of  opinion  as  to  the  exact  rate  of  duty  necessary 
for  this  protection.   It  cannot  be  expected  that  even  the  most  expert 
tariff  commission  can  figure  out  that  rate  exactly.    It  can  only  deter- 
mine the  upper  and  lower  limits  of  the  necessary  protection— the 
upper  limit  of  excessive  protection,  the  lower  limit  that  ceases  to 

protect. 

But  with  the  policy  of  protection  itself  accepted,  the  matter  of 
finding  the  exact  rate  for  any  particular  industry  is  a  detail  that 
does  not  now  concern  us.  The  important  thing  is  that  -^i^^rotfip- 
tive  policy  l^asjiow  settled  down  where  it  genuinely  accepts  'the^argu- 
ment  whicli^.its  advocates  have  msisted  upon "Torj^e  past  ejghty 
years— protection  to  ^  Amencan  labof '  agamst  cheap  Tofefgn  labor, 
the  weakness  of  this  argument  has^-rrtways  been  that  the  federal 


^ii^ 


814       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

Congress  has  never  undertaken  to  be  consistent ;  it  has  never  under- 
taken to  provide  that  the  protected  workman  should  actually  get  the 
protection.  It  has  left  that  matter  to  be  settled  either  by  unions  and 
strikes  or  by  the  good  will  of  manufacturers. 

How  far  these  two  methods  have  succeeded  we  can  readily  ascer- 
tain. In  the  steel  industry  the  unions  have  been  almost  completely 
destroyed,  and  there  is  no  indication  in  sight  that  laborers  in  that 
business  will  ever  again  be  able  to  establish  an  organization  that 
can  deal  with  the  manufacturers  on  equal  terms.  In  the  paper 
industry  it  was  largely  through  the  energy  of  the  unions  in  the 
Eastern  states  that  the  eight-hour  day  was  established  in  the  face 
of  the  twelve-hour  day  in  the  Western  states  where  the  unions  had 
been  destroyed.  But  these  very  unions  of  paper  workers  are  the 
most  insistent  of  all  advocates  of  eight-hour  legislation  to  protect 
them  in  the  gains  they  have  already  secured.  Local  unions  of  paper 
workers  in  Massachusetts  sent  their  representatives  to  be  heard  by 
the  state  commission  on  the  subject  and  strongly  appealed  for  state 
legislation  in  opposition  to  the  arguments  of  their  employers.  The 
unions  there  are  confronted  by  the  fact  that  about  10  per  cent  of 
the  paper  mills  remain  on  the  twelve-hour  system  ;  and,  further,  they 
naturally  infer,  when  their  own  employers,  who  have  already  ac- 
cepted the  eight-hour  day,  nevertheless  oppose  legislation  requiring 
their  twelve-hour  competitors  to  come  down  to  the  same  basis,  that 
these  employers  intend  to  go  back  to  twelve  hours  if  they  can  do  so 
at  a  good  opportunity  in  the  future.  They  are  not  willing  to  trust 
the  good  will  of  their  employers. 

That  the  good  will  of  manufacturers  cannot  be  depended  upon 
to  pass  over  to  their  employees  the  benefits  of  protection  is  also 
abundantly  shown  in  the  steel  industry.  In  that  industry  the  smaller 
competitors  must  follow  the  lead  of  the  great  corporation  that  sets 
the  standards,  or  else  be  put  out  of  business.  Yet  when,  a  few  years 
ago,  the  United  States  Steel  Corporation  took  a  vote  of  its  stock- 
holders on  the  eight-hour  day,  after  an  exciting  campaign  conducted 
by  a  few  of  them  inside  the  organization,  the  majority  of  the  stock- 
holders voted  against  it  and  the  plan  was  dropped.  Even  on  the 
much  less  expensive  project  of  one  day  of  rest  in  seven  the  same  cor- 
poration has  already  abandoned  its  former  humanitarian  policy.  No 
more  impressive  lesson  of  the  futility  of  depending  on  the  good  will 


EIGHT-HOUR  SHIFTS 


81S 


of  even  the  most  prosperous  of  the  tariff  beneficiaries  can  be  offered 
than  the  testimony  of  its  competitor,  the  Lackawanna  Steel  Com- 
pany, in  its  petition  for  exemption  from  the  one-day-rest  law  of  New 
York.  In  its  petition,  offered  during  the  present  year,  the  Lacka- 
wanna Company  says  (p.  31)  • 

We  are  advised  that  the  chairman  of  the  United  States  Steel  Cor- 
poration several  years  ago,  while  labor  conditions  were  entirely  dit- 
ferent  from  those  obtaining  at  the  present  time,  gave  mstructions 
quite  peremptory  in  character  to  all  the  subsidiaries  of  that  company 
requiring   them   to   follow   out   the   one-day-of-rest   prmciple    and 
warning  them  that  any  deviation  from  the  published  mstructions 
would  result  in  dismissal  from  office.   We  have,  therefore,  directed 
our  investigations  to  these  subsidiaries  and  state,  without  fear  ot 
successful  contradiction,  that  the  Corporation  is  now  disregarding 
the  one-day-of-rest-in-seven  principle  which  it  so  strongly  advocated 
several  years  ago  and  which  it  in  the  past,  in  good  faith   earnestly 
strove  to  put  into  practice.    It  too  has  felt  the  shortage  of  men  and 
owing  to  the  great  and  pressing  demand  for  its  product  no  longer 
observes  the  practice  which  its  chairman  promulgated.   Having  taken 
so  firm  a  portion,  it  is  not  strange  that  it  is  difficult  to  get  heads  o 
subsidiaries  to  admit  that  the  published  rule  has  become  a  dead 
letter    When  labor  conditions  become  normal  the  Corporation  will 
doubtless  return  to  an  observance  of  the  rule.    So  far  as  we  can 
ascertain,  the  rule  was  only  observed  by  the  Corporation  durmg  the 
years  when  the  employees  of  this  company  had  far  more  time  off 
than  the  one-day-of-rest  statute  requires. 

The  Lackawanna  Company  then  offers  to  produce  affidavits  sup- 
porting these  statements. 

Other  instances  might  be  given,  but  they  are  not  now  necessaty. 
We  are  forced  to  conclude  that  in  manufacturing  industries  with 
continuous  processes  neither  unionism  nor  good  will  can  secure  the 
eight-hour  day.  Only  federal  legislation  can  overcome  the  valid  ob- 
jections of  interstate  competition  and  protection  of  the  home  market. 

Another  objection  that  has  influence  is  the  one  that  American 
manufacturers  will  be  unable  to  sell  their  products  in  foreign  mar- 
kets in  competition  with  foreigners.  Granted  that  we  can  protect 
the  home  market,  they  say  we  cannot  capture  the  foreign  market. 
Two  considerations  must  be  taken  into  account  in  meeting  this  ob- 
jection. In  the  first  place,  it  is  a  question  of  public  policy  whether 
the  American  nation  shall  sacrifice  its  wage-earners  in  order  to 


8i6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


hi 


enable  its  manufacturers  to  compete  in  foreign  markets.  This  ques- 
tion of  policy  must  be  settled  before  we  can  consider  any  other  ob- 
jections to  a  reduction  of  hours  from  twelve  to  eight.  We  hold  that 
if  foreign  markets  cannot  be  captured  unless  laborers  are  forced  to 
work  twelve  hours  in  continuous  industries,  then  they  are  not  worth 
capturing.  Our  100,000,000  population  furnishes  the  greatest  home 
market  in  the  world.  If  we  are  willing  to  tax  ourselves  in  order  to 
protect  American  labor  in  this  bountiful  home  market,  it  is  prepos- 
terous to  ask  us  to  give  up  this  very  protection,  which  is  the  main 
object  of  our  tariff,  just  because  we  want  to  drive  foreigners  out  of 
foreign  markets. 

Again,  we  very  well  know  another  penalty  which  we  must  pay 
if  we  push  American  manufactures  too  hard  into  foreign  markets. 
The  penalty  is  a  huge  navy  and  military  preparedness  in  order  to 
keep  other  manufacturing  nations,  like  Germany  and  Japan,  from 
driving  us  out  of  neutral  markets  like  China  and  South  America. 
We  can  protect  our  home  market  by  a  tariff ;  we  can  capture  and 
hold  the  foreign  market  only  by  an  army  and  navy.  Furthermore, 
twelve-hour  labor  in  these  continuous  industries  will  need  a  bigger 
navy  and  army  than  eight-hour  labor,  because  it  will  enable  our 
manufacturers  more  easily  to  undersell  foreigners  and  so  will  more 
surely  aggravate  them  into  threatening  us  with  their  own  armies 
and  navies. 

Again,  from  this  very  standpoint  of  military  preparedness  it  needs 
no  argument  to  show  that  laborerswho  work  twelve  hours^cgntjnu- 
ously  can  never  be  equally  fitf  or  enlistment  iiTUme  oTiarxompared 
wjtiTtliose'^  who  work  only  eight  hours.  The  t\velye-hour.sy:stem  is 
^^!£l^al^^^£lor  purpose  of  capturing  foreign  markeis.  It  stirs 
up  foreign  competitors  to  greater  military  preparation  against  us  and, 
at  the  same  time,  breaks  down  the  health  and  strength  of  the  very 
working  people  who  must  be  called  upon  to  protect  and  defend  that 
foreign  market. 

But  it  does  not  follow  that  foreign  countries  will  always  adhere 
to  the  twelve-hour  system.  Even  before  the  war  Great  Britain's 
iron  and  steel  industry  had  about  completed  the  change  to  an  eight- 
hour  system.  The  International  Association  for  Labor  Legislation, 
in  1912,  initiated  the  movement  for  treaties  on  this  subject  among 
competing  nations.    This  movement  was  interrupted  by  the  war,  but 


EIGHT-HOUR  SHIFTS 


817 


that  it  is  already  bearing  fruit  is  indicated  by  press  dispatches  from 
Sweden  (December  2,  1916)  stating  that  Sweden,  Norway,  Den- 
mark  and  Russia  have  joined  together  in  the  investigation  of  the 
:oipulp  industry  preparatory  to  adopting  the  thre.shf  t  s^^^^^^^^^ 
The  action  of  the  American  section,  in  brmgmg  forward  at  this  time 
a  bill  for  federal  legislation,  is  in  line  with  this  -vement  m.^^^^^^^ 
in  1012  by  the  International  Association.  But  the  United  States 
:ver:ment  does  not  enter  into  treaties  of  this  ^^nd  and  o^^^^^ 
protective-tariff  system  and  enormous  home  market  make  it  unneces 
siry  to  wait  and  see  what  other  countries  will  do  after  the  war 

Another  reason  why  manufacturers  oppose  this  legis^t.on  is  the  . 
dread  that  the  introduction  of  the  eight-hour  system  by  law  in  the 
crtinuous  processes  will  be  an  entering  wedge  for  introducmg  it  m 
other  processes  and  industries. 

Of  course,  federal  legislation  for  eight  hours  in  continuous  proc- 
esses may  possibly  suggest  similar  laws  for  noncontinuous  processes 
Nobody  can  promise  that  the  agitation  will  stop  at  the  conUnuous 
nrocess    But  noncontinuous  industries  stand  on  a  different  footmg. 
?n   hem  the  hours  can  be  gradually  reduced  and  federal  legislation 
is  not  required.   If,  however,  the  fear  of  other  laws  not  "ow  needed 
is  allowed  to  prevent  the  enactment  of  a  law  urgently  needed,  then, 
of  course,  all  progressive  legislation  on  any  subject  can  be  prevented 
The  fear  of  further  legislation  has  always  stood  in  the  way  of  needed 
legislation.   It  is  only  by  going  ahead  in  spite  of  this  fear  that  any 
progress  can  be  made  and  any  particular  law  can  be  discussed  on 

its  merits  i 

It  may' be  that  it  is  this  dread  of  further  legislation  that  prevents| 
employers  who  privately  favor  this  law  from  publicly  supporting  it.J 
But  there  seems  to  be  another  reason.   In  the  Massachusetts  hearings 
even  the  paper  manufacturers  who  already  have  the  eight-hour  day 
in  competition  with  others  on  the  twelve-hour  day  nevertheless,  with 
one  exception,  opposed  state  legislation  requiring  their  competitors 
to  adopt  it.   Their  objection  is  incomprehensible  from  the  standpoint 
of  self-interest.   It  can  be  explained  only  from  the  standpoint  of 
class  interest.   They  oppose  a  law  which  would  benefit  themselves 
individually  because  they  stand  by  other  employers  who  would  not 
be  benefited  by  it.    If  this  class  interest  of  employers  is  so  great  as 
to  outweigh  self-interest,  surely  such  employers  cannot  raise  the 


8i8       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

objection  to  this  law  that  it  is  class  legislation.  If  they  suppress  their 
private  opinions  in  the  interest  of  their  class  opinions,  they  have 
already  disqualified  themselves  from  objecting  to  legislation  that 
treats  them  as  a  class. 

The  bill,  in  tentative  form,  is  limited  to  the  iron  and  steel  and 
the  paper  industries.  It  is  in  these  two  industries  that  governmental 
investigations  have  already  been  made  ^  which  warrant  legislation  at 
this  time.  But  the  administrative  board  created  by  the  bill  is  directed 
to  investigate  other  continuous  industries  of  interstate  commerce  and 
to  recommend  to  Congress  the  extension  of  the  act  wherever  it  is 
practicable  and  desirable  to  establish,  the  three-shift  system. 

The  enforcement  of  the  law  follows  the  model  set  by  the  child- 
labor  law  of  19 1 6.-  The  Attorney  General,  the  Secretary  of  Com- 
merce, and  the  Secretary  of  Labor  constitute  a  board  with  power 
to  make  rules  and  regulations.  The  Secretary  of  Labor  and  the  fed- 
eral district  attorneys  inspect  and  prosecute.  The  law  comes  under 
the  power  of  Congress  to  regulate  interstate  commerce. 

In  order  that  manufacturers  may  have  time  to  work  out  their  own 
methods  of  obeying  the  law,  the  date  of  taking  effect  is  set  ahead 
three  years,  but  the  board  is  authorized  to  promulgate  rules  at  an 
earlier  date.  In  this  way  it  is  possible  for  employers  to  take  advan- 
tage of  any  falling  off  in  business  and  to  introduce  the  three-shift 
system  at  a  time  when  it  will  offset  unemployment. 

I  shall  not  stop  to  discuss  at  length  the  constitutional  question.- 
The  decisions  of  the  courts  are  familiar.  Some  decisions  support 
this  proposed  legislation,  others  run  counter  to  it.  It  seems  to 
violate  some  of  the  abstract  principles  of  individual  liberty.  It  takes 
away  from  the  employer  certain  property  rights  and  transfers  them  to 
his  employees  ;  it  compels  him  to  employ  more  laborers  than  he  would 
if  he  ran  his  business  in  his  own  way ;  it  takes  away  the  liberty  of 
the  worker  by  prohibiting  him  from  earning  more  money  by  working 
overtime;  and,  worst  of  all,  this  worker,  who  is  being  paid  more 
money  for  less  liberty,  is  a  grown-up  man — not  a  child  nor  a  woman. 

It  may  be  admitted  that  these  constitutional  objections  would 
have  weight  if  the  thing  were  left  to  state  legislation.   A   state 

1  By  the  Tariff  Board  and  the  Bureau  of  Labor  Statistics. 

2  Overthrown  by  the  Supreme  Court  but  reenacted  under  the  taxing  power 
of  United  States  statutes. 


EIGHT-HOUR  SHIFTS 


819 


.nnrt  i.  confronted  by  the  fact  that  the  state  legislature 

fice  on  the  par    01  «•"?  J  j^   j^^iff  already  inter- 

nent   eaders  of  organized  labor.   They  oppose  legislation  reguhit.ng 
hours  oflabor  of  adult  male  workers  not  because  it  deprives  the  in- 

dividual  of  ftT'iltive  liberty  which  the  unions  have  acquired 

what  th  tw  permits  them  to  do  by  strikes  and  boycotts,  becau  e 
^ev  fear  a^thing  that  invites  the  courts  to  take  part  in  the  struggle 
S  or  an  rd    5al  and  organized  labor.   Their  experience,  likewise 
has  sCrthem  too  often  that  labor  laws  are  a  dead  letter,  and  tha 
ev  n  with  a  law  on  the  statute  book  it  -"^'™- .^"l"'^^?,;,^"''' 
olthe  threat  of  a  strike  to  get  it  enforced  according    o  its  mt  nt^ 
Naturally.  >a^h^hejrJrade_union  is  more  important_than_ajaw 

:!lS;£;^^S,uld  be  seriously  considered,  but  it  is  submitted 
^federal  light-hour  law  for  continuous  industri.  ^JXfjs   One 
ferent  footing  from  state  legislation  for  noncontinuous  ndustries.  One 
of  S  reason's  why  state  laws  are  not  strictly  enforced^s  this^v^H.  act 
of  the  necessity  of  meeting  interstate  competition    ^ut  a  fed  ral  aw 
Llied  equally  ever>'where,  furnishes  much  less  inducement  to  viola 
Tn  than'a  sta'e  law  which  forces  on  the  -P'°y- ^^^^^P^^  ,:;J;^ 
violating  it  or  giving  up  his  business  to  competitors  '-^  o*er  stat^^ 
Furthermore,  in  the  steel  industry,  for  example,  with  >     vig    "^^ 
antiunion  policy,  it  is  difficult  to  see  how  a  union  can  ever  secure  such 
a"  g  that  ft  can  compel  this  powerful  corporation  to  come  dovm 
abruptly  from  twelve  hours  to  eight  hours.   The  same  is  true  of    *e 
ontLous  industries,  such  as  sugar  refining,  where  Je  bul^  °f  * 
business  is  controlled  by  a  trust.   On  the  other  hand,  injh^paper 


ii 


820       TRADE  UNIOxNISM  AND  LABOR  PROBLEMS 

industry  it  is  theJairlv  well-organized  unioTm  nf  >|^^«;;^rhii.iPtf^  which 
are  the  most  insistent  advocates  of  eight-hour  legislation  and  which 
"Kave  sent  Iheir  leaders  and  members  topresslhe  matter  before  the 
state  legislative  committeeT  ^  ~~  " 

m  general,  it  is  quite  evident  that  the  trade-union  opposition  to 
eight-hour  legislation  does  not  extend  to  all  unions  nor  to  all  of  the 
rank  and  file,  and  this  opposition  is  likely  to  disappear  when  unions 
seriously  attempt  the  stupendous  task  of  reducing  hours  from  twelve 
to  eight  in  the  continuous  industries. 

In  fact  the  field  of  unionism  is  not  materially  lessened  by  the  pro- 
posed law,  and  on  this  point  it  doubtless  will  be  considered  by  some 
persons  a  fatal  defect  that  the  bill  does  not  propose  to  prohibit  a  re- 
duction in  wages  when  it  requires  a  reduction  in  hours.  The  reasons 
underlying  this  limitation  are  partly  economic,  partly  administrative, 
and  partly  political.  From  the  economic  standpoint  experience  has 
shown  that  if  overtime  is  prohibited  both  the  increased  demand  for 
labor  and  the  standard  of  life  of  the  laborers  may  be  expected  to  bring 
the  wages  for  eight  hours  up  to  the  former  level  of  twelve  hours.  How- 
ever, this  can  scarcely  occur  at  once,  and  it  is  more  likely  to  occur 
if  a  labor  union  must  be  taken  into  account  by  the  employer. 

From  the  administrative  standpoint  it  is  not  proposed  to  regulate 
wages  by  law  on  account  of  the  difficulty  of  getting  evidence  of  viola- 
tions. The  wide  differences  in  wages  of  individuals  and  classes  and 
the  fact  that  the  individual  worker  would  be  required  to  testify 
against  his  employer  make  the  enforcement  of  a  wage  law  the  most 
difficult  of  all  labor  laws.  But  the  eight-hour  day,  if  uniform  for 
all  labor  in  the  same  establishment,  can,  by  the  device  of  requiring 
the  names  and  hours  of  each  employee  to  be  posted,  be  made  to  fur- 
nish to  the  factory  inspector  its  own  evidence  of  violation. 

From  the  political  standpoint  the  regulation  of  wages  for  all  classes 
of  labor  must  eventually  lead  to  compulsory  arbitration  and  its  pro- 
hibition of  strikes — a  strain  on  our  political  institutions  which  we 
are  not  prepared  to  meet.  But  regulation  of  hours  of  labor  in  con- 
tinuous industries  does  not  introduce  a  new  and  radical  policy ;  it  is 
only  the  extension  of  a  policy  already  recognized  and  successfully  en- 
forced through  state  and  federal  legislation. 

John  R.  Commons 

University  of  Wisconsin 


EIGHT-HOUR  SHIFTS 


821 


TENTATIVE  DRAFT  OF  A  BILL^ 

To  regulate  interstate  and  foreign  commerce  in  products  of  continu- 
ous industries. 

Sect.  i.  That  no  producer,  manufacturer,  or  dealer  shall  ship 
or  deliver  for  shipment  in  interstate  or  foreign  commerce  any  article 
or  commodity  the  product  of  any  mill  or  manufacturing  establishment 
situated  in  the  United  States  and  engaged  in 

(c)  the  production  of  pig  or  molten  iron,  or  steel  mgots  by  what- 
ever process  made, 

(b)  the  rolling  of  steel  or  iron  by  any  hot  process, 

(c)  the  refining  of  iron  by  any  hot  process,  or 

Id)  the  production  of  mechanical  wood  pulp,  sulphite  or  sulphate 
pulp,  newsprint,  book  or  other  paper,  cardboard  or  other 
manufactures  of  pulp, 
in  which  within  thirty  days  prior  to  the  time  of  the  removal  of  such 
product  therefrom  any  person  engaged  in  mechanical  or  manual  labor 
has  been  employed  or  permitted  to  work  more  than  eight  hours 
in  any  day  or  more  than  six  days  in  any  week. 

Sect.  2.  That  the  manager,  superintendent,  or  foreman  of  any 
such  mill  or  manufacturing  establishment  shall  when  and  as  required 
by  the  board  post  in  the  mill  or  manufacturing  establishment  a  notice 
on  a  printed  form  furnished  by  the  board,  stating  the  name  of  every 
person  employed  therein  and  for  every  such  person  the  hours  of  work 
required  on  each  day  of  the  week,  the  hours  of  beginning  and  quitting 
work,  and  the  period  allowed  for  meals.  The  presence  of  any  such 
person  in  the  mill  or  manufacturing  establishment  at  a  time  not 
included  in  the  hours  of  work  of  such  person  as  stated  in  such  notice 
shall  constitute  prima  facie  evidence  that  such  person  was  then  em- 
ployed or  permitted  to  work  contrary  to  the  standards  prescribed  by 

Section  i  of  this  act. 

Sect.  3.  That  the  Attorney  General,  the  Secretary  of  Commerce, 
and  the  Secretary  of  Labor  shall  constitute  a  board,  herein  referred 
to  as  the  board,  to  make  and  publish  from  time  to  time  uniform  rules 
and  regulations  for  carrying  out  the  provisions  of  this  act.  The 
Secretary  of  Labor  shall  investigate  and  report  to  the  board  the 
conduct  and  operation  of  mines,  quarries,  mills,  and  manufacturing 
establishments  situated  in  the  United  States  which  are  operated  both 
day  and  night  on  at  least  thirty  calendar  days  in  the  year,  and  shall 
ascertain  when  it  is  practicable  and  desirable  to  establish  the  three- 
shift  system  for  carrving  on  work  in  such  mines,  quarries,  mills,  or 
manufacturing   establishments.    The   board   shall    make   an   annual 

1  In  view  of  the  decision  on  the  child-labor  law  this  bill  should  probably  be 
drawn  under  the  taxing  power. 


'-ri 


822       TRADE  UNIONISM  AND  LABOR  PROBLEMS 

report  to  Congress  of  its  findings  and  its  recommendations  with 
respect  to  the  extension  of  this  act  to  the  products  of  industries  other 
than  those  specified  in  Section  i. 

Sect.  4.  That  for  the  purpose  of  securing  proper  enforcement  of 
this  act  the  Secretary  of  Labor,  or  any  person  duly  authorizled  by 
him,  shall  have  authority  to  enter  and  inspect  at  any  time  mills  and 
manufacturing  establishments  and  other  places  in  which  goods  are 
produced  or  held  for  interstate  or  foreign  commerce ;  and  the  Secre- 
tary of  Labor  shall  have  authority  to  employ  such  assistance  for  the 
purposes  of  this  act  as  may  from  time  to  time  be  authorized  by 
appropriation  or  other  law. 

Sect.  5.  That  it  shall  be  the  duty  of  each  district  attorney  to 
whom  the  Secretary  of  Labor  reports  any  violation  of  this  act,  or  to 
whom  any  state  factory  inspector  or  commissioner  of  labor,  state 
medical  inspector,  or  any  other  person  presents  satisfactory  evidence 
of  any  such  violation,  to  cause  appropriate  proceedings  to  be  com- 
menced and  prosecuted  in  the  proper  courts  of  the  United  States 
without  delay  for  the  enforcement  of  the  penalties  in  such  cases 
herein  provided. 

Sect.  6.  That  any  person  who  violates  any  of  the  provisions  of 
Sections  i  or  2  of  this  act,  or  who  refuses  or  obstructs  entry  or 
inspection  authorized  by  Section  4  of  this  act,  shall  for  each  offense 
prior  to  the  first  conviction  of  such  person  under  the  provisions  of 
this  act  be  punished  by  a  fine  of  not  more  than  $200,  and  shall  for 
each  offense  subsequent  to  such  conviction  be  punished  by  a  fine  of 
not  more  than  $1000  nor  less  than  Si 00,  or  by  imprisonment  for 
not  more  than  three  months,  or  by  both  such  fine  and  imprisonment, 
in  the  discretion  of  the  court :  Provided,  That  no  dealer  shall  be 
prosecuted  under  the  provisions  of  this  act  who  establishes  a  guaranty 
issued  by  the  producer  or  manufacturer,  resident  in  the  United  States, 
to  the  effect  that  the  goods  shipped,  delivered  for  shipment,  or  trans- 
ported, were  produced  or  manufactured  in  a  mill  or  manufacturing 
establishment  specified  in  Section  i  in  which  within  thirty  days 
prior  to  the  removal  of  such  goods  therefrom  no  person  engaged  in 
mechanical  or  manual  labor  was  employed  or  permitted  to  work  more 
than  eight  hours  in  any  day  or  more  than  six  days  in  any  week ; 
and  in  such  event,  if  the  guaranty  contains  any  false  statement  of  a 
material  fact  the  guarantor  shall  be  amenable  to  prosecution  and  to 
the  fine  or  imprisonment  provided  herein  for  violation  of  the  provi- 
sions of  Section  i  of  this  act. 

Sect.  7.  That  the  word  "person"  as  used  in  this  act  shall  be 
construed  to  include  any  individual  or  corporation  or  the  members 
of  any  partnership  or  other  unincorporated  association.  The  term 
"ship  or  deliver  for  shipment  in  interstate  or  foreign  commerce"  as 
used  in  this  act  means  to  transport  or  to  ship  or  deliver  for  shipment 


EIGHT-HOUR  SHIFTS 


823 


from  any  state  or  territory  or  the  District  of  Columbia  to  or  through 
any  other  state  or  territory  or  the  District  of  Columbia  or  to  any 
foreign  country ;  and  in  the  case  of  a  dealer  means  only  to  transport 
or  to  ship  or  deliver  for  shipment  from  the  state,  territory,  or  Dis- 
trict of  manufacture  or  production.  The  term  "  three-shift  system  for 
carrying  on  work"  means  that  three  shifts  or  relays  of  workers  are 
used,  whether  the  shifts  or  relays  are  changed  at  intervals  of  eight 

hours  or  less.  , 

Sect  8    That  this  act  shall  take  effect  January  i,  1920,  except 
as  to  Section  3,  which  shall  take  effect  January  i,  19 19. 


!t^5£i»-^3=Jl^-^  ' 


INDEX   OF   LEGAL   CASES    CITED 


Adair  v.  United  States,  579,  621,  635 
Allgeyer  v.  Louisiana,  605 
Atkin  V.  Kansas,  612 
Atkin  V.  i/wifed  States,  615 
>ltA:in5  v.  Grey  Eagle  Cod  Co.,  632 

Baltimore  &  Ohio  R.  R.   v.  Interstate 

Commerce  Commission,  619,  627 
Bey  man  v.   Cleveland,  611 
Borgnis  et  al.  v.  Fa/fe  Co.,  21 
Bos/cy  V.  McLaughlin,  617,  626,  630 
Braceville   Coal   Co.   v.   Pco/)/e,    589, 

600,  611  .      ^ 

Brannigan  v.  f/niow  Min.  Co.,  592 
Burcher  v.  Pgo/»/e,  616 
Butchers'  Union  Co.  v.  Crescent  City 

Co.,  591,  595 

Ca/d^r  V.  Bm//,  59i        .  ,    ^    ^.,     _ 
Coffeyville  Vitrified  Brick  &  Tile  to. 

V.  Perry,  603  o    .r  d  p 

Commonwealth  v.  Boston  6-  M.K.K., 

Commonwealth  v.  Hamilton  Mfg.  Co., 

611,  615  ,      ,.         ^ 

Commonwealth  v.  Isenberg,  602 
Commonwealth  v.  McKay,  669 
Commonwealth  v.  Perry,  59i>  598,  623, 

631 
Coppage  V.  Kansas',  621,  635 

Dayfon  Coo/  6-  /ron  Co.  v.  Barton, 

612 
Deni  v.  Pennsylvania  Co.,  592 
Dugger  V.  Insurance  Co.,  611 
Dwrifem  V.  Coa/  Co.,  592 

£ag/e  G/a55  and  Manufacturing  Com- 
pany V.  Rowe,  664 
£ar/  0/  Chesterfield  v.  Janssen,  609 
£:c  Farfe  Boyce,  619 
£x  Parte  Kair,  611,  619 
£%  Parte  Kuback,  597,  598 

Pair/ee  v.  Herring,  592 
Fletcher  v.  PecA;,  591 
Prorer  v.  Peo/>/e,  588,  589,  592,  593, 
598,  601 


Gillespie  v.  People,  603 

Godcharles  v.  Wigeman,  580,  589,  596, 

597,  598,  600,  601,  602,  612 
Grossman  v.  Caminez,  592 

Hadacheck  v.  Sebastian,  631,  633 

Hancock  v.    Yaden,  612 

Harbison  v.  Knoxville  Iron  Co.,  612 

Harding  v.  People,  593,  602 

Hawkins  v.  Bleakley,  21 

Hawley  v.  P^a/feer,  617,  626 

Heim  V.  McCall,  615 

Hitchman   Coal  and  Coke  Company 

V.  Mitchell  et  al.,  635,  652 
Ho/den  V.  Hardy,  611,  618,  621,  624, 

810 
Hoiy  V.  PFeWon,  608 
Hoxie  V.  iVeiy  For^,  iVezy  Haven,  and 

Hartford  R.  R.  Co.,  40 

/n  re  Boyce,  611,  619 
/n  re  Broad,  612 
/n  re  House  Bill,  599 
/n  re  Morgan,  602,  618 
International  Text  Book  Co.  v.  Trew- 
singer,  612 

/arra/^    Timber    etc.    Corporation    v. 

Samiiel,  608  ^ 

Johnson    v.    Goodyear    Mining    Co., 

602,  611 
/ones  V.  People,  596 

Xing  V.  Barger,  669 
Knoxville  Coal  &  Iron  Co.  v.  Har&z- 
5on,  612 

Lee/>  V.  Railway  Co.,  59i,  600,  611 
Loan  Association  v.  Topeka,  591 
Lochner  v.  iVew  ForA;,  590,  604,  620, 

624,  630,  637,  810 
Low;  V.  i?ee5  Printing  Co.,  600,  620 

McClure  v.  Paben,  609 

McLean  v.  ^rfeansas,   599,  602,  611, 

612,  627,  630 
McLean  v.  5tate,  600 
McMillan  v.  5/>ider  LaAie   etc.  Co.,  592 


825 


-     .7->4««  1 


826       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


'■^', 


Mathews  v.  People,  604 

Matter  of  Jacobs,  596 

Meng  V.  Coffey,  595 

Middleton  v.  Jearaj  Power  and  Light 

Co.,  21 
Miller  v.  TFi/5on,  617,  626,  630 
Millet  V.  People,  597,  598,  600 
Mountain    Timber    Co.    v.    5ia/c    0/ 

Washington,  21 
Mugler  V.  Kansas,  593 
Midler  v.  Oregon,  611,  616,  623,  625, 

626 
Mnnn  v.  Illinois,  609 
National     Founders'     Association     v. 

Taplin  Rice  and  Company,  426 

iV.   F.  C.  /?.i?.  Co.,  V.  W^Aite,  21 
A'oWe  5fafe  Banfe  v.  Haskell,  21 
Northern     Pacific     Railway     Co.     v. 
Meese,  21 

Opinion  of  Justices,  612 

Parke  Davis  &  Co.  v.  Mtdford  &  Co., 

634 
P<?o/>/f  V.  B6cfe,  589 
Peo/>/g  V.  Co/er,  585,  604 
People  V.  Crane,  615 
People   V.   Klinck  Packing    Co.,   622, 

628,  629 
People  V.  Marcus,  603,  606 
People  V.  Mara:,  593,  596 
People  V.  Schweinler  Press,  617,  626, 

627,  630,  633 
People  V.  Strollo,  613 
People    V.    PFi7/fam5,    616,    617,    624, 

627 
P/anf  V.  1^00^5,  649 
Price  V.  Illinois,  628,  629,  633 

Railway  Co.  v.  Chicago,  591 
Railway  Company  v.  Paw/,  611 
Ramsey  v.  People,  599 
jRe  Ten  i7o?^r  Lau?  /or  5fre«t  Railway 

Corporations,    619 
i?ice  V.  Noakes,  608 
J?i/ey   V.   Massachusetts,  617 
i?z7c/iif  V.  Pfo/>/e  588,  591,  593,  600, 

601,  603,  612,  615 
Ritchie  &  Co.  v.  PTaymrtn,  617,  626 
Roberts  v.   Great   Northern  R.   Co., 

592 


Schlemmer  v,  Bw^a/o  -R.  (S-  P.  /J.  Co., 

592 
5cott  V.  Sanford,  593 
Shaffer  v.  Mining  Co.,  611 
Shaver  v.  Pennsylvania  Co.,  602 
Slaughter  House  Cases,  595,  603,  605 
Spurgeon  v.  Collier,  608 
Starnes  v.  Allison  Mfg.  Co.,  611 
5/aie  V.  At  kin,  612 
5/afe  V.  Barba,  622 
5fafe  V.  Brown  &  Sharpe  Mfg.  Co., 

611 
5^a/e  V.   Buchanan,  611,  616 
5/afe  V.  Bunting,  622,  628 
5fate  V.   Cantwell,  619 
5fafe  V.  P/re  Creefe  Coa/  (S*  Co^e  Co., 

588,  591,  592,  597 
5/afe  V.  Goodwill,  589,  592,  595.  597, 

598,  609,  632 
5fa<e  V.  /fawn,  588,  589,  591,  593,  603, 

611 
5fafe  V.  Julow,  601 
5/ate  V.  Kreutzberg,  603 
5fa/e  V.  Loomis,  591,  592,  600 
5fa<g  V.  Lumber  Co.,  621 
5^afe  V.  Miksicek,  621 
5fafc  V.  Missouri  Tie  &  Timber  Co., 

604,  611 
5fafe  V.  Midler,  611 
5fafe  V.  Pee/  5/»/fnf  Coa/  Co.,  611 
5tafe  V.  Shorey,  611 
5fafe  V.  Varney  Electrical  Supply  Co., 

604 
5fafe  V.  Wilson,  611 
Steenerson  v.  Greaf  Northern  Ry.,  634 
Stettler  v.  O'Hara,  626 
Sturges  V.  Beauchamp,  617 
Sturges  V.  Crowninshield,  581 

Taylour  v.  Rockford,  608 
Thorpe  v.  Thorpe,  609 

t/.  S.  V.  Martin,  612 

Vegalahn  v.  Guntner,  648 
Fernon  v.  Bethell,  597,  608 

PFewAam  v.  5fafe,  611,  615 

ir/iee/mg   Bridge   &  Terminal  Co,  v. 

Gilmore,  600 
lFi/50«  V.  AVu',  639 
Wynhamer  v.  People,  593 


INDEX  OF  SUBJECTS  AND  AUTHORS 


Absenteeism,  in  the  shipbuilding  indus- 
try, 335 

Accident  insurance.  5ee  Working- 
men's  insurance 

Accidents,  care  of,  171;  estimates  of, 
22;  in  shops  of  Joseph  and  Feiss, 
171;  in  shipbuilding  industry,  330; 
statistics  of,  30-33;  tax  on,  81 

Accounting.   5ee  Cost  records 

Acland,  F.  A.,  782 

Acton,  Lord,  584 

Adams,  Henry,  negro  leader,  117 

Adams,  T.  S.,  and  Sumner,  H.  L., 
"Labor  Problems,"  389 

Addams,  Jane,  613 

Adler,  Edward  A.,  "Labor,  Capital 
and  Business  at  Common  Law,"  624 

Ahrens,  "Cours  de  droit  naturel,"  581 

Alaska,  workingmen's  insurance  in,  17 

Alexander,  M.  W.,  "Apprenticeship  in 
the  Metal  Trades,"  xi,  233;  "Hir- 
ing and  Firing,"  156,  160 

Alifas,  N.  P.,  objections  to  scientific 
management,  144-149;  trade-union 
representative,  x,  141 

Alifas,  N.  P.,  and  Taylor,  F.  W., 
"Scientific  Shop  Management,"  141 

Amalgamated  Clothing  Workers  of 
America,  535 

Amalgamated  Meat  Cutters  and 
Butcher   Workmen,   363,   366,   377, 

384 
Amalgamated  Rubber  Workers'  Union, 

379,  545  ^      . 

American  Association  for  Labor  Legis- 
lation, "  Three  Years  Under  the  New 
Jersey  Workmen's  Compensation 
Law,"  41 

American  Association  of  Masters, 
Mates,  and  Pilots,  352,  354 

American  Bottle  Company,  472 

"American  Federation  of  Labor  Re- 
construction Program,"  xii,  562 ; 
control  of,  394 ;  criticized,  loi ;  de- 
velopment of,  349-361,  364-365, 
383,  386,  391-401,  436,  481 ;  "Trade- 
Unions  versus  Shop  Committees," 
xi,  345 


American  Federation  of  Teachers,  360 
American  Labor  Union,  393,  394 
American  Railway  Union,  378 
Andrews,  J.  B.,  and  Commons,  J.  R., 
"Principles   of    Labor   Legislation," 

ix,  763 
Anthracite    Coal    Strike    Commission, 

xii,  495-524,  701 

Anthracite  industry,  arbitration  and 
conciliation,   495-524 

Anti-Boycott  Association,  407,  431 

Apprenticeship,  233-248 

Aquinas,  St.  Thomas,  584 

Arbitration,  in  anthracite  industry, 
495-524;  in  Australia,  667-693;  in 
Canada,  779-806;  in  Hart  Schaff- 
ner  &  Marx  agreement,  536,  556;  of 
wages,  694-713.  See  also  Concilia- 
tion 

Aristotle,  "Nicomachean  Ethics,"  584; 
"Politics,"  593 

Arizona,  minimum  wage  in,   746-747 

Arkansas,  minimum  wage  in,  746-747, 
760;  workingmen's  insurance  in,  18 

Arthur,  P.  M.,  355 

Ask  with,  Sir  George,   780-781 

Associated  Brotherhood  of  Iron  and 
Steel  Heaters,  363 

Associations.   See  Corporations 

Australia,  conciliation  and  arbitration 
in,  667-693 ;  High  Court  of,  xii 

Australian  Court  of  Conciliation  and 
Arbitration,  xii 

Awards  in  the  anthracite  industry, 
495-524;  in  Australia,  682 

Awards  for  accidents  and  injuries. 
See  Benefits,  Workingmen's  insur- 
ance 

Ayres,  L.  P.,  "Some  Conditions  Affect- 
ing Problems  of  Industrial  Educa- 
tion," 150 

Backhouse,  Judge  A.  P.,  708 

Bailey,  Justice,  599 

Baker,  J.   S.,   "Profit-Sharing   in   the 

Baker    Manufacturing    Company," 

xi,  263 
Bakers'  Union,  75 


827 


'mi 


828       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


INDEX  OF  SUBJECTS  AND  AUTHORS 


829 


t'^: 


Baltimore  Allied  Printing  Trades 
Council,  386 

Banks,  nationalization  of,  in  Russia, 
186 

Barbers'  Union,  74,  75 

Barnett,  G.  E.,  "Dominance  of  the 
National  Union  in  American  Labor 
Organization,"  xi,  386;  "The  Print- 
ers," 389 

Beneficiary  societies.  See  Fraternal 
beneficiary  societies 

Bcnetits,  American  workingmen's,  17- 
44;  British,  61;  industrial,  284; 
trade-union,  66,  71.  See  also  Sickness 
insurance,   VVorkingmen's    insurance 

Bentham,  Jeremy,  "Theory  of  Legis- 
lation," 580 

Berger,  Victor,  393 

Bernhard,  Ludwig,  "  UnerwUnschte 
Folgen  der  deutschen  Sozialpolitik," 
24 

Berolzheimer,  System  der  Rechts  und 
VVirthschaftsphilosophie,  582 

Best,  Chief  Justice,  592 

Bituminous  industry,  52  5-533 

Black,  Chief  Justice,  600 

Blackstone,   585,   59© 

Blast  Furnace  Workers  and  Smelters, 

381 
Boilermakers  and  Iron  Ship  Builders, 

354  ^        , 

Bolshevism,  179-198;   propaganda  of, 

in  United  States,  2 

Bonus  systems,  199-204;  in  shipbuild- 
ing, 316.  See  also  Differential  rates. 
Premium  systems.  Profit-sharing 

Book  and  job  printing.  See  Printing 
industry 

Boot  and  Shoe  Workers'  Union,  bene- 
fits in,  74-75i   78;   policy  of,  368, 

399 
Boycotts,  as  unions'  weapon,  398 

Bradley,  Justice,  605 

Brandeis,  L.  D.,  opinions  and  decisions 

of,  625-626,  633,  636,  653-654,  656, 

658-659,  661,  74<5 
Brest-Litovsk  Treaty,  188 
Brewer,  Justice,  618-627,  636 
Brewery  Workmen,  363,  377,  397 
Bricklayers'  and  Masons'  International 

Union,  370-393 
Bridge  Tenders'  Union,  358 
Bridge  and  Structural  Iron  Workers, 

407 
Brissenden,  P.   F.,  "Labor   Turnover 

in  the  San  Francisco  Bay  Region," 

151 


British  Labor  Party,  program  of,  xii 
British  Steel  Smelters'  Association,  70 
Brotherhoods.    See  name  of  trade 
Brown,  Justice,  618 
Brown,  R.  B.,  "The  Men  We  Lodge," 

104 
Bruce,  Judge  A.  A.,  "The  Illinois  Ten 

Hour  Labor  Law  for  Women,"  632 
Building    trades,   history    of,   401 ;    in 

San    Francisco,    477-488;    violated 

agreements  of,  488 
Building  Trades  Council,  364,  374-375. 

401 
Burgess,  J.  W.,  "Political  Science  and 

Constitutional  Law,"  580 
Burke,  J.  P.,  221 

Burke,   W.   M.,   "History   and   Func- 
tions of  Central  Labor  Unions,"  398 
Burlamaqui,     "Natural     Law,"     590; 

"Principles  of  Natural   and  Politic 

Law,"  581 
Burnside,  Justice,  703 
Butler,    F.    X.,    "Profit-Sharing    by 

American  Employers,"  261 
"Button  strikes,"  516 

California,  minimum  wage  in,  738- 
778;  workingmen's  insurance  in, 
17-44 

Canadian  Industrial  Disputes  Investi- 
gation Act,  779-806 

Capitalism,  credit  system  the  basis  of, 
8;  failure  of,  12;  modern  beginning 

of,  13 

Carlton,  F.  T,  "History  and  Prob- 
lems of  Organized  Labor,"  389 

Carnegie  Foundation  for  the  Advance- 
ment of  Teaching,  "Justice  and  the 
Poor,"  41 

Carpenters  and  Joiners,  74,  378-379, 
402 

Carriage  and  Wagon  Workers'  Inter- 
national Union,  381 

Cartwright,  Justice,  602 

Casual  labor,  107,  125-140.  See  also 
Migratory  labor 

Cease,  D.  L.,  356 

Cessations,  in  anthracite  industry,  513. 
See  also  Stoppages 

Chaney,  Dr.  L.  W.,  and  Hanna,  H.  S., 
"Accidents  and  Accident  Preven- 
tion in  Machine  Building,"  330-332 

Chicago  Federation  of  Labor,  398 

Chicago  Teachers'   Federation,  360 

Child  labor,  in  American  Federation 
of  Labor  program,  566;  hours  of, 
615;  turnover  for,  157,  161 


\ 


Cigar    Makers'    International    Union, 

74-75,  377 
Citizens'  Alliances,  407 

Clark,  E.  E.,  357  ,.       ^  ^ 

Clark,  Dr.  V.  S.,  "Canadian  Indus- 
trial   Disputes    Investigation    Act," 
781;    "Labor    Movement    in    Aus- 
tralia,"  708 
Clarke,  Justice,  636 
Closed  shops,  in  shipbuilding,  318 
Cloth  Hat  and  Cap  Makers'  Union,  75 
Clothcraft     Shops.   See    Joseph     and 

Feiss  Company 
Coal  Operators'  Association,  709 
Coal-mining  industry,  anthracite,  495 ; 
bituminous,  635;   convention  in,  3; 
United  States  administration's  fail- 
ure in,  3-4 
Cockburn,  "Nationality,"   592 
Coke,  "Second  Institute,"  585,  593 
Collective  bargaining,  constitutionality 
of,     635-666;     effect    of     scientific 
management    on,    147;    failure    of, 
255;  by  founders,  406-432;  in  glass 
industry,  458-476;  by  Hart  Schaff- 
ner  &  Marx,  534t56i  ;  by  pattern- 
makers, 489-494;  plan  for,  270-287; 
rate  fixing  by,  216-217;  in  shipbuild- 
ing, 318;  by  workshop  committees, 

293 

Colorado,  minimum  wage  m,  746,  749, 
752 ;  workingmen's  insurance  in,  38 

Commons,  J.  R.,  "Bringing  ibout 
Industrial  Peace,"  i;  at  buUding- 
trades  hearing,  482-483,  486-487; 
"Eight-Hour  Shifts  by  Federal 
Legislation,"  807;  "Health  Pro- 
gram," 81;  "Industrial  Goodwill," 
x;  "Industrial  Relations,"  i 

Commons,  J.  R.,  and  Andrews,  J.  B., 
"Principles    of    Labor    Legislation," 

'^^^  763  „  ^ 

Commons,     J.     R.,     and     assoaates, 

"Documentary  History  of  Ameri- 
can Industrial  Society,"  387 

Company  unions,  condemned  by 
American  Federation  of  Labor,  346 

Compensation.  See  Workingmen's 
insurance 

Competition,  restrictions  of,  in  ship- 
building, 337  ,    . 

Composing-room    Relief    Association, 

77 
Compton,  Wilson,  "Wage  Theories  in 

Industrial  Arbitration,"  xii,  694, 
Compulsory  arbitration.   See  Arbitra- 
tion 


Compulsory    insurance.  See    Sickness 

insurance 
Conciliation,    in    anthracite    industry, 

495-524;  in  Australia,  667-693;  in 

Canada,   779-806;    in   Hart  Schaff- 

ner  &  Marx  agreement,   556.      See 

also  Arbitration 
Connecticut,    workingmen's    insurance 

in,  18-19,  25-27 
Connecticut     Federation     of     Labor, 

workingmen's  insurance  opposed  by, 

19 
Contmuous  industries,  bill  relating  to, 

821 
Contract.    See  Liberty  of  contract 
Cook,   W.   W.,   "Privileges   of    Labor 

Unions  in   the   Struggle   for   Life," 

657,  665  ^   ,       . 

Cooperation,  in  American  Federation 

of  Labor  program,  566 

Cooperation  in  industry,  between 
employer  and  employee,  288,  290, 
300,  337;  in  Hart  Schaffner  &  Marx 
agreement.  534-56 1.  See  also  Shar- 
ing management 

Cooperative  welfare  associations,  270- 

287 
Corporations,  attacked,  13;  beginning 
of,  13,  14;  regulation  of,  in  Ameri- 
can Federation   of  Labor  program, 

571 
Corwin,     S.,    "The     Supreme     Court 

and    the    Fourteenth    Amendment," 

632 
Cost  of  livmg,  m   Australia,  687;   of 

miners,  3 
Cost  records,  as  production  incentives, 

228;  in  Russia,  180 
Courcelle-SeneuU,  J.  G.,  "Preparation 

a  I'etude  du  droit,"  584 
Creative  instincts,  as  incentives,   218- 

232,  289 
Credit  svstem,  as  basis  of  capitalism,  8 
Crograan,   Dr.  W.   H.,   on   defects  of 

migration,     123;     "Talks    for    the 

Times,"  116,  123 
Cross,  I.  B.,  "San  Francisco  Building 

Trades,"  xii,  477 
Curtis,  Justice,  593 

Day,  Justice,  612,  620,  636,  642-645, 

647-648,  666 
Deibler,  F.  S.,  "Patternmakers'  Local 

Agreements,  Chicago,"  xii,  489 
Dempsey,  J.  T.,  516 
Dennison     Manufacturing     Company, 

reduction  of  turnover  by,  163-164 


830       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


Detectives,  employers',  429 
Diamond  Workers'  Union,  75 
Dicey,     A.     V.,     "Law     and     Public 
Opinion  in  England,"  582,  610,  624 
Dictatorship  in  Russia,  179-198 
Differential   rates,   definition   of,   200- 
201.   See  also  Bonus  systems,  Pre- 
mium  systems.   Profit-sharing 
Discipline,   in   shops   of   Hart   Schaff- 

ner  &  Marx,  558 
District  of  Columbia,  minimum  wage 

in,  746,  750-751,  754;  workingmen's 
insurance  in,  17-18 

Doctors,  new  profession  of,  81-93 

Dos  Passos,  J.  R.,  "The  American 
Lawyer,"  590 

Douglas,  D.  W.,  "American  Minimum- 
Wage  Laws  at  Work,"  xii,  738; 
"Standard  of  Living  for  Working 
Women,"  774 

Douglas,  P.  H.,  "Problem  of  Labor 
Turnover,"   150 

Douglas,  P.  H.,  and  Wolfe,  F.  E., 
"Labor  Administration  in  the  Ship- 
building Industry  during  War 
Time,"  xi,  311 

Dublin  Typographical  Society,  390 

Dunning,  W.  A.,  "Political  Theories," 
584 

Eager,  Almeron,  on  profit-sharing, 
263 

Eastern  League  of  Green  Glass  Bottle 
Blowers,  458 

Education,  in  American  Federation  of 
Labor  program,  572;  factory,  297- 
298;  of  lawyers,  590.  See  also  Fac- 
tory schools,  Industrial  education. 
Vocational  education 

Efficiency,  correlation  of  departments, 
175;  eight-hour  shifts,  807-823;  in 
hiring,  166;  incentives  to,  218-232; 
need  of  personal  relations  for,  12; 
principles  of,  141 ;  profit-sharing, 
256,  260;  in  Russia,  179-198;  in 
shops  of  Joseph  and  Feiss,  178; 
specializing,  289.  See  also  Bonus 
systems.  Cooperation  in  industry. 
Differential  rates.  Mental  tests, 
Piecework,  Premium  systems.  Profit- 
sharing,  Sharmg  management,  Time 
studies 

Elections  and  appointments  in  indus- 
try, 297 

Electrical  Workers,  354,  377 

Eliot,  Dr.  C.  W.,  "Profit-Sharing 
and    Scientific    Management,"    250; 


"Profit-Sharing  in  the  United 
States,"  250;  "The  Road  to  Indus- 
trial Peace,"  250,  262 

Elliott,  Justice,  612 

Ellis  Island  Immigration  Station,  104 

Ellison,  Judge,  (197 

Ely,  R.  T.,  "Economic  Theory  and 
Labor  Legislation,"  579 

Emergency  Fleet  Corporation,  labor 
administration  of,  xi,  311-344 

Emerson,  Harrington,  on  bonus  sys- 
tems, 202-204 

Emmet,  Boris,  "Labor  Turnover  in 
Cleveland  and  Detroit,"  151 ;  "Labor 
Turnover  and  Employment  Poli- 
cies," 333;  "Nature  and  Computa- 
tion of  Labor  Turnover,"  153; 
Profit-sharing  in  the  United  States, 
xi,  164,  249 

Employers,  classes  of,  15;  misrepre- 
sentation of  labor  by,  2;  moral  re- 
sponsibility of,  175,  260 

Employers'  associations,  in  building- 
trades  conflicts,  477-488;  founders, 
406-432,  433-457;  glass-bottle  agree- 
ment, 458-476 

Employers'  liability.  See  Sickness  in- 
surance,   Workingmen's   insurance 

Employment,  insecurity  of,  ix,  7; 
need  of  security  of,  9,  See  also 
Unemployment 

Employment  bureaus,  134-140;  in 
American  Federation  of  Labor  pro- 
gram, 573;  centralization  of,  137, 
162;  failure  of,  134;  need  of,  135; 
in  shipbuilding,  325;  in  shops  of 
Joseph  and  Feiss,  166 

Employment  managers,  cities  and 
companies  having,  163 

Equality  of  rights,  588 

Erdman  Act,  699,   702 

Factory  inspection,  new  functions  of, 
9,  83 

Factory  schools,  need  of,  297.  See 
also  Industrial  education,  Voca- 
tional education 

Farm  Colony  of  Department  of  Pub- 
lic Charities,  104 

Federation  of  Organized  Trades  and 
Labor  Unions,  390 

Fee,  Grant,  on  building  trades,  484, 
486-487 

Feiss,  R.  A.,  "Personal  Relationship 
as  a  Basis  of  Scientific  Manage- 
ment," X,  165 

Fichte,   "Theory   of  Legislation,"   580 


INDEX  OF  SUBJECTS  AND  AUTHORS 


831 


Field,  H.  M.,  "Life  of  David  Dudley 

Field,"  596 
Field,  Justice,  591,  595-59^,  605,  609 
Figgis,    "From    Gerson    to    Grotius," 

584 

Firemen's  Union,  358 

Fisher,  Boyd,  "How  to  Reduce  the 
Labor  Turnover,"  156;  "Methods 
of  Reducing  the  Labor  Turnover," 

157 

Fisher,  Irving,  "Stabilizing  the  Dol- 
lar," 5 

Fisher,  W.  C,  "American  Experience 
with  Workmen's  Compensation,"  ix, 

17 

Fitch,  J.  A.,  "Making  the  Boss  Effi- 
cient," 157 

Fleming,  W.  L.,  "'Pap'  Singleton:  the 
Moses  of  the  Colored  Exodus,"  117 

Flint  Bottle  Manufacturers'  Associa- 
tion, 462 

Flint  Glass  Workers,  393,  397 

Floating  laborers.  See  Migratory 
labor 

Florida,  18 

Fluctuations,  prevention  of,  175 

Ford  Motor  Company,  a  psychologi- 
cal miracle,  11;  turnover  in,  156, 
160,  163 

Foremen,  election  and  promotion  of, 
297 

Foundry  Employees'  Union,  75,  381, 
427 

Foundry   workers,   struggles   of,   406- 

432,  433-457 
Framingham,   demonstration   m,   88 
Frankfurter,  Felix,  "Hours  of  Labor 

and  Realism  in  Constitutional  Law," 

xii,  614 
Frankfurter,  Felix,  and  Goldmark,  J., 

"Oregon    Minimum    Wage     Brief," 

740 

Fraternal  beneficiary  societies,  British, 
47;  of  marine  engineers,  352;  of 
post-office  employees,  350;  of  rail- 
road employees,  355 

Freedom  of  contract.  See  Liberty  of 
contract 

French  Revolution,  individual  bargain- 
ing, 16;  overthrow  of  old  systems, 

13-14 
Freund,  Ernst,  "  Constitutional  Limita- 
tions and  Labor  Legislation,"  632- 
633;  "Limitations  of  Hours  of 
Labor  and  the  Federal  Supreme 
Court,  614,  632;  "Police  Power," 
622 


Friendly  societies.   See  Fraternal  bene- 
ficiary societies 
Fuller,  Chief  Justice,  636 

Gantt,  H.  L.,  203,  204;  "Bonus  Sys- 
tem of  Rewarding  Labor,"  201 
Garment  Workers'  Union,  74 
General  Electric  Company,  apprentice- 
ship system  of,  xi,   233-248;   turn- 
over in,  156 
George,  Lloyd,  and  health  insurance, 
45;  and  the  policemen's  strike,  359 

Georgia,  18 

German-American  Typographia,  74 

Oilman,  N.  P.,  "Profit-Sharing  be- 
tween Employer  and  Employee," 
250 

Glass  House  Employees,  381 

Glass  Vial  and  Bottle  Manufacturers, 
458,  463,  465-466 

Glocker,  T.  W.,  "  Amalgamation  of  Re- 
lated Trades  in  American  Unions," 
xi,  362;  "Government  of  American 
Trade  Unions,"  389 

Goldmark,  Josephine,  "Fatigue  and 
Efficiency,"  624-625,  628-629,  740 

Goldmark,  Josephine,  and  Frank- 
furter, F.,  "Oregon  Minimum  Wage 
Brief,"  740 

Gompers,  Samuel,  and  employers' 
liability,  19;  and  industrial  peace, 
12 

Good  will,  developed  by  profit- 
sharing,  260,  269 

Goodrich  Tire  and  Rubber  Company, 
turnover  in,  157 

Gordon,  Justice,  703 

Gould  Coupler  Co.,  446 

Government  ownership  in  American 
Federation   of  Labor  program,  569 

Granite  Cutters'  Union,  74 

Gray,  George,  512-513,  524 

Great  Britain,  health  insurance  in, 
45-55 ;  unemployment  insurance  in, 
56-70 

Greeley,  L.  N.,  "The  Changing  Atti- 
tude of  the  Courts  toward  Social 
Legislation,"  632 

Green  Glass  Bottle  Blowers,  397*  458- 
476 

Gregg,  R.  C,  "Method  of  Handling 
the   Problem    of    Labor  Turnover," 

157,  163 
Grievances,  in  Hart  Schaffner  &  Marx 
agreement,  537»  54°;  settlement  of, 
495-524;  and  workshop  committees, 

29s 


4* 


832        TRADE  UNIONISM  AND  LABOR  PROBLEMS 


INDEX  OF  SUBJECTS  AND  AUTHORS 


833 


Grieves,    W.   A.,    "The    Handling    of 

Men,"  156,  160 
Grotius,   "De   Jure    Belli   et   Pacis," 

581,  SQO,   503 

Guyot,  Yves,  "Principles  of  Social 
Economy,"  584 

Halsey,  F.  A.,  iqq,  203-204 

Halsey,  O.  S.,  "British  National  Sys- 
tem of  Unemployment  Insurance," 
ix,  56;  "Compulsory  Health  In- 
surance in  Great  Britain,"  Lx,  45 

Hammond,  M.  B.,  711;  "Australian 
Experience  with  Wage  Boards,"  706- 
707 

Hand,  Judge  Learned,  634;  "Due 
Process  of  Law  and  the  Eight-Hour 
Day,"  614,  632 

Hanna,  H.  S.,  and  Chaney,  L.  W., 
"Accidents  and  Accident  Preven- 
tion in  Machine  Building,"  330- 
332 

Harlan,  Justice,  591,  593,  606,  620, 
636-640;  on  equality  of  rights,  588; 
on  liberty  of  contract,  579 

Hart  Schaffner  &  Marx  labor  agree- 
ment, xii,  534 

Hawaii,  17,  20 

Hayden,  Justice,  704,  711 

Hayes,  president  of  the  Glass  Bottle 
Blowers'   Association,   460,   474-475 

Health.     See  Public  health 

Health  insurance.  See  Sickness  in- 
surance 

Henderson,  Professor,  588 

Henley,  Lord  Keeper,  608 

Higgins,  H.  B.,  628,  702-703,  705;  "A 
New  Province  for  Law  and  Order," 
xii,  667 

Hiring  and  firing,  166.  See  also  Effi- 
ciency, Employment  bureaus 

Hiscock,  Judge,  622 

Hoboes,    See  Migratory  labor 

Hobson,  J.  A.,  "Work  and  Wealth," 
629 

Hod  Carriers  and  Building  Laborers, 
381-382 

Hoffman,  F.  L.,  "Facts  and  Fallacies 
of  Compulsory  Health  Insurance," 
85;  on  injuries,  22,  33 

Holmes,  Justice,  598,  606,  614,  620- 
621,  623,  631,  636,  640-644,  646, 
648-650,  663;  "The  Path  of  the 
Law,"  590;  on  police  power,  21 

Holt,  Lord,  609 

Homeless.   See  Migratory  labor 

Hookstadt,  Carl,  43 


Hopkins,  E.  M.,  turnover  estimates  of, 
158 

Hotel  &  Restaurant  Employees'  Union, 
75 

Hours  of  labor,  in  American  Federa- 
tion of  Labor  program,  565 ;  coal 
mining,  3 ;  constitutionality  of,  614- 
634;  in  dangerous  employments, 
618;  eight-hour  shifts,  807-823; 
one-day  rest,  622;  in  shipbuilding, 
316;  in  shops  of  Joseph  and  Feiss, 
178 

Housing,  in  American  Federation  of 
Labor  program,  574 

Howard,  E.  D.,  555;  "The  Develop- 
ment of  Government  in  Industry," 

534 
Hubbard,  Justice,  593 
Hughes,  Justice,  617,  636,  648 

Illinois,  17,  20,  23,  25 

Illinois  Coal  Operators'  Association, 
525,  528,  531 

Immigration,  in  American  Federation 
of  Labor  program,  572;  anthracite 
industry  affected  by,  508;  labor 
market  affected  by,  126 

Income  tax  in  Russia,  187 

Independent  Workers'  Federation,  678 

Industrial  Accident  Boards  and  Cora- 
missions,  34 

Industrial     accidents.    See     Accidents. 

Industrial  Assembly,  388 

Industrial  Congress,  388 

Industrial  Disputes  Investigation  Act 
of  Canada,  779,  806 

Industrial  education  in  shipbuilding, 
326.  See  also  Factory  schools.  Voca- 
tional education 

Industrial   efficiency.    See   Efficiency 

Industrial  evolution,  effects  of,  221 

Industrial  relations,  1-16 

Industrial    revolution,   effects    of,    150 

Industrial  welfare,  need  of,  306 

Industrial  Workers  of  the  World,  loi- 
102,  363,  377,  511;  decline  of,  394; 
split  in,  364 

Injuries.   See  Accidents 

Insecurity  of  employment.  See  Em- 
ployment 

Insurance.  See  Life  insurance,  Mater- 
nity  insurance,  Sickness  insurance. 
Unemployment,  Workingmen's  in- 
surance 

International  associations,  brother- 
hoods, and  unions.  See  name  of 
trade 


m 


International      Harvester      Company, 

records  of,  31 
Iowa,  20 

Iredell,  Justice,  591 
Iron  Molders.    See  Molders 
Iron  and  Steel  Roll  Hands,  363 
Iron  and  Steel  Workers'  Union,  75 

Janes,  G.  M.,  "Tendencies  in  Trade- 
Union  Development,"  xi,  349 

Jeffrey  Manufacturing  Company,  156 

Jellinek,  "System  der  subjectiven 
offentlichen  Rechte,     580 

Joseph  and  Feiss  Company,  labor 
policy  of,  165-178 

Journeymen,  history  of,  72 

Journeymen  Plumbers,  371 

Jurisprudence,  583 

Juveniles.   See  Child  labor 

Kansas,  minimum  wage  in,  738-778; 

workingmen's  insurance,  17,  20,  43 
Kelley,  Mrs.  Florence,  "Some  Ethical 

Gains  through  Legislation,"  599 
Kellogg,  F.  W.,  488 
Kennaday,  P.,  711 
Kennedy,  J.  B.,  "Beneficiary  Features 

of  American  Trade  Unions,"  389 
Kentucky,  20,  37 
Kerenskv,  abdication  of,  179 
Kirk,      William,      "National      Labor 

Federations  in  the   United   States," 

390,  401 
Knights  of  Labor,  393,  450 ;  failure  of, 

383;   in  glass-bottle  industry,   459; 

growth  of,  390-391 ;  organization  of, 

388 

Labor,  classification  of,  129;  defect 
of  organization  of,  16;  employers' 
misrepresentation  of,  2.  See  also 
Liberty  of  contract,  and  special 
topics 

Labor  unions,  amalgamation  of  trades 
in,  362-385;   development  of,  349- 
361;   discipline   of,  558;   dominance 
of  national,  386-405 ;  in  glass-bottle 
industry,  458-476;    of  patternmak- 
ers,   489-494;    preference    to,    545, 
678;    recognition   of,   557;    right   to 
membership  in,  603,  636,  651 ;  right 
to  organize,  563 ;  struggles  of,  406- 
432,   433-457;    violated   agreements 
of,    5,    488.     See  also    names    of 
unions 
Laborers'    Union    Protective    Society, 

382 


Lackawanna  Steel  Company,  815 

Lake  Carriers'  Association,  97 

Lamar,  Justice,  636 

Land,  in  American  Federation  of 
Labor  program,  570 

Lauck,  W.  J.,  and  Sydenstricker, 
Edgar,  "Conditions  of  Labor  in 
American  Industries,"  259 

Lawyers,   training   of.   See   Education 

Leather  Workers  on  Horse  Goods 
Union,  74 

Legislation,  in  American  Federation  of 
Labor  program,  567 

Lenin,  Nikolai,  despotism  of,  x; 
"Scientific  Management  and  Dic- 
tatorship of  the  Proletariat,"  179 

Le  Rossignol,  J.  E.,  "Compulsory 
Arbitration  in  New  Zealand,"  706 

Lescohier,  D.  D.,  "A  Clearing  House 
for  Labor,"  ix,  125 

Letter  Carriers,  350 

Liberty  bonds,  workincmen's  disposal 

of,  3 
Liberty   of   contract,   constitutionality 

of,  579-613,  642  ,   ^  „  ^ 

Lieber,  "CivU  Liberty  and  Self-Gov- 

ernment,"  580 
Life  insurance,  industrial,  283,  285 
Lloyd  George.    See  George,  Lloyd 
Locomotive   Engineers,  355,   369,  393 
Locomotive  Firemen  and  Enginemen, 

355-356,  393  -  -     ,  T    ^ 

Lodging  houses.  See  Municipal  Lodg- 
ing House 

London  Compositors  Union,  390 

London  Society  of  Compositors,  70 

Louisiana,  20 

Lowell,  J.  R.,  quotation  from,  690- 
691 

Lumber  camps,  evils  of,  96 

Lynch,  J.  M.,  "Trade-Union  Sickness 
Insurance,"  ix,  71 

McCabe,  D.  A.,  "Premium  and  Bonus 

Systems  of  Payment,"  x,  199;  "The 

Standard   Rate  in  American  Trade 

Unions,"  389,  448 

McCarthy,  P.  H.,  482-483,  485-487 

Machinists'  Union,   74,  354,  377,  407 

Macintosh,  "Discourses  on  the  Study 

of  the  Law  of  Nature  and  Nations, 

590 

McKenna,  Justice,  636-640 

MacNary,  E.  E.,  327 

McRevnolds,  Justice,  636 

McShane,  Henry,  Manufacturing  Com- 
pany, 446 


834       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


Macy,  \^  E.,  314;  "Shop  Committees 

and  Unions,"  320 
Magruder,     Justice,     on     employers' 

rights,  603 ;   on  hberty  of  contract, 

604 ;  on  women's  rights,  601 
Maine,    Sir    Henry,    708;    "Ancient 

Law,"  581 
Manufacturers'  associations,  407,  431 
Marine  engineers,  352,  354 
Marshall,  Chief  justice,  581,  591,  651 
Marx,    Karl,    on    capitalism,    14;    on 

social  labor  power,  12;  theories  of, 

IQI 

Maryland,  31 

Massachusetts,  minimum  wage  in,  738- 
778;  workingmen's  insurance  in,  17- 

44 
Master  workmen,  history  of,  72 

Maternity  insurance,  British,  47,  54 

Medical   ethics.    See   Doctors 

Medical  examination,  in  Framingham, 
88;  in  shops  of  Joseph  and  Feiss, 
170;  of  unemployed,  105;  at  Uni- 
versity of  Wisconsin,  89 

Meeker,  Royal,  629 

Mensheviks,  181,  184,  188 

Mental  tests,  in  shops  of  Joseph  and 
Feiss,  173 

Merchant  capitalist,  history  of,  72 

Metal  Trades,  x,  365,  375»  406 

Metal  trades,  apprenticeship  in,  233- 
248 

Mexican  Revolution,  99 

Meyer,  Carl,  536 

Michigan,  20,  38 

Migratory  labor,  94-103,  104-114; 
causes  of,  131;  negroes,  115-124; 
types  of,  127,  130 

Militarism,  affected  by  hours  of  labor, 
816;  in  American  Federation  of 
Labor  program,  574 

Mill,  J.  S.,  "Liberty,"  582,  610; 
"Political  Economy,"  585 

Miller,  Justice,  591 

Mine  workers,  in  anthracite  industry, 
495-524;  in  bituminous  industry, 
525-533;   under  Canadian  Act,  794 

Minimum  wage,  American  laws  for, 
738-778;  in  Australia,  669;  in  Hart 
Schaffner  &  Marx  agreement,  543; 
for  women,  714-737 

Minnesota,  minimum  wage  in,  738- 
778;  workingmen's  insurance  in, 
20,  42 

Misrepresentation  of  labor  by  em- 
ployers, 2 

Mississippi,  18 


Mitchell,  John,  502,  527,  530 

Mitten,  T.  E.,  and  profit-sharing,  xi, 

271 
Mixter,  C.   W.,  "Protection   of   Piece 

Rate,"  xi,  205 
Molders,  75,  363,  377;  sick  benefits  of, 

74,  78;   struggles  of,  406-432,  433- 

457 
Montana,  20,  39 

Montesquieu,  "Lettres  persanes,"  581 
Moral  responsibility  of  employers,  175, 

200 
Morrison,  Frank,  394 
Mullenbach,  James,  537 
Municipal  Lodging  House,  104-114 

National  associations,  federations,  and 
unions.    See  name  of  trade 

National  Civic  Federation,  "Profit- 
Sharing  by  American  Employers," 
256 

National  Council  for  Industrial  De- 
fense, 431 

National  Erectors'  Association,  407 

National  Founders'  Association,  strug- 
gles of,  406-432,  433-457 

National  Labor  Union,  388 

National  Trade  Assembly,  459 

National  Tuberculosis  Association,  92 

Natural  rights,  581 

Nebraska,  minimum  wage  in,  746, 
748,  752 ;  workingmen's  insurance  in, 

44 
Negroes,  migration  of,  11 5-1 24 

Neill,  C.  P.,  512,  520-522 

Newark  Building  Trades  Council,  403 

New  Hampshire,  20,  44 

New  Jersey,  20,  38,  41 

New  York,  17,  20,  22,  24,  25,  31,  34 

North,  S.  N,  D.,  "Industrial  Arbitra- 
tion," 712 

North  Carolina,  17 

North  Dakota,  minimum  wage  in,  746- 
750;  workingmen's  insurance  in,  18 

Northington,  Lord,  597,  608 

O'Brien,  Justice,  585,  604 

Ohio,  workingmen's  insurance   in,   17, 

20,  25-28,  34,  37 
Old-age  pensions,  284 
One-day    rest,    815;    constitutionality 

of;  622 
Ontario,  22-23 
Oregon,   minimum  wage  in,   738-778; 

workingmen's  insurance  in,  20,  25,  42 
Orr,  J.  L.,  on  negro  migration,  115 
Overtime  in  shipbuilding,  316-317 


INDEX  OF  SUBJECTS  AND  AUTHORS 


83  s 


Pacific  Telephone  and  Telegraph  Com- 
pany, turnover  in,  157 

Painters'  Union,  75 

Paley,  "Moral  and  Political  Philoso- 
phy," 590 

Parker,  Carleton,  "The  California 
Casual  and  his  Revolt,"  158 

Pattern  Makers'  Association  of  Chi- 
cago, 489-494 

Pattern  Makers'  Union,  74,  75 

Paupers.    See  Poor 

Peckham,  Justice,  605,  618,  620,  627, 

636 
Pennsylvania,  workingmen's  insurance 

in,  17-44 
Personal  relations,  need  of,  12 
Persons,  C.  E.,  "Women's  Work  and 

Wages  in  the  United  States,"   715, 

Pf  abler,  W.  H.,  "History  of  the 
National  Founders'  Association,"  409 
Philadelphia  Rapid  Transit  Com- 
pany, "A  Plan  for  Collective  Bar- 
gaining and  Cooperative  Welfare," 
xi,  270-287 

Photo  Engravers'  Union,  75 

Piano  and  Organ  Workers'  Union,  74 

Piecework,  205-217;  in  Australia,  676; 
evils  of,  145;  joint  agreements  for, 
293;  union  cooperation  regarding, 
216 

Piez,  Charles,  317 

Pitney,  Justice,  636,  639,  645-646,  655- 
663,  665 

Plato,  "Republic,"  584 

Plimpton  Press,  turnover  of,  i57,  163 

Plumb,  Fayette  R.,  Company,  160 

Plumb  plan,  8 

Plumbers'  Union,  74-7S»  354 

Pocket  Knife  Blade  Grinders'  Union, 

75 
Police  power,  21 

Policemen,  strike  of,  358-359 

Political  parties,  in  American  Federa- 
tion of  Labor  program,  568 

Pollock,  Sir  Frederick,  606;  "The 
New  York  Labor  Law  and  the 
Fourteenth  Amendment,"  632 

Poor,  British,  54 

Porto  Rico,  minimum  wage  in,^  746, 
747;  workingmen's  insurance  in,  17 

Post-office  employees,  unions  of,  350 

Pound,  Roscoe,  "Common  Law  and 
Legislation,"  592-593;  "Legislation 
as  a  Social  Function,"  634;  Liberty 
of  Contract,  xii,  579 

Poverty.     See  Poor 


Powell,  T.  R.,  "Collective  Bargaining 
before  the  Supreme  Court,"  xii,  635 
Preferential   shops,  in  Australia,  678; 
in   Hart   Schaffner   &   Marx   agree- 
ment, 545  .,       - 
Premium   systems,    199-204;   evils   01, 
145.    See  also  Bonus  systems.  Differ- 
ential  rates.  Profit-sharing 
President's  Industrial  Conference,  12 
Prices,  fluctuations  of,  4 
Printing  industry,  cost  of  living  and 

wages  in,  5 
Printing  Trades  Association,  386 
Production,  incentives  to,  218-232 
Profit-sharing,  249-262;  in  the  Baker 
Manufacturing   Company,   263-269; 
in  the  Ford  Motor  Company,   11; 
labor  affected  by,  255-257;  turnover 
affected    bv,    164.    See    also    Bonus 
systems.  Differential  rates.  Premium 
systems 
Promotions,  in  industry,  297 
Psychological  tests,  in  shops  of  Joseph 

and  Feiss,  173 
Psychology  of  labor,  7 
Public    health,    accident    and   sickness 
prevention,   81-93;   industrial,   171; 
in  shipbuilding,  329 
Public  safety,  in  shipbuilding,  329 
Public   utilities,   in   American   Federa- 
tion of  Labor  program,  569 
Puffendorf,  590;  "Law  of  Nature  and 

Nations,"  581 
Pulp  Sulphite  and  Paper  Mill  Work- 
ers' Union,  221 


Quarry  Workers'  International  Union, 
377 


Railroad  Brakemen,  356 

Railroad    employees,    Canadian,    795; 

union  development  of,  355 
Railroad  Telegraphers,  358 
Railroad  Trainmen,  355,  356,  377,  393, 

609 
Railway    Conductors,    355-35^,    3^9, 

393,  699         ... 
Railway  Mail  Association,  350 

Railway  Postal  Clerks,  350 
Reconstruction,    American    Federation 

of  Labor  program  of,  562-578 
Records,  importance  of,  31 ;  in  Joseph 

and  Feiss  Company,  168 
Recreation,  need  of,  306 
Red  Guard,  Russian,  182 


>•»■--,  ■ViST-U!'-*.- 


S3 6       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


I 


Reeves,  W.  P.,  "State  Experiments  in 
Australia  and  New  Zealand,"  713 

Rehabilitation,  in  American  Federa- 
tion of  Labor  program,  576 

Renold,  C.  G.,  "Workshop  Commit- 
tees," xi,  288 

Restriction  in  industry,  of  hours,  3; 
of  output,  6,  531 

Retail  Clerks'  Union,  75 

Rhode  Island.  20 

Ricardo,  "Principles  of  Political 
Economy,"  585;  "Works,"  582 

Ritchie,  D.  G.,  "Natural  Rights,"  582 

Roosevelt  Anthracite  Coal  Strike  Com- 
mission. See  Anthracite  Coal  Strike 
Commission 

Rousier,  Paul  de,  "The  Labor  Ques- 
tion in  Britain,"  150 

Russian  Soviet  Republic,  collective 
bargaining  in,  16;  confiscation  of 
factories  by,  x;  French  Revolution 
compared  with,  14 ;  misconceptions 
in,  X,  8;  scientific  management  in, 
179-198 

Rutherforth,  "Natural  Law,"  593 

Safety.   See  Accidents,  Public  safety 

Sakolski,  A.  M.,  "Finances  of  Ameri- 
can Trade  Unions,"  389 

San  Francisco  Building  Trades  Coun- 
cil, 477-488.  See  also  Building 
trades 

San  Francisco  Planing  Mill  Owners' 
Association,  486 

San  Francisco  Trades  and  Labor 
Assembly,  397 

Sanitation,  in  shipbuilding,  329 

Schloss,  D.  F.,  "Methods  of  Indus- 
trial Remuneration,"  250 

Scholfield,  Justice,  597-508 

Schouler,  James,  "Ideals  of  the  Re- 
public," 590 

Scientific  management,  and  collective 
bargaining,  147 ;  old  and  new,  x, 
141-149,  165-178,  179-108 

Scott,  W.  D.,  psychological  tests  by, 

173 
Scottish  Typographical  Association,  390 
Scroggs,  W.  O.,  "Interstate  Migration 

of  Negro  Population,"  115 
Seager,     H.     R.,     "Introduction     to 
Economics,"  579,  583,  589;  on  mini- 
mum wage,  717;  psychological  tests 

by,  173 
Seamen's  Union,  377,  383,  399 
Seasonal  labor,  107,  125-140.   See  dso 

Migratory  labor 


Security  of  employment.  See  Employ- 
ment 

Seniority,  in  Hart  Schaffner  &  Marx 
agreement,  546 

Sharing  management,  meaning  of, 
297;  in  shipbuilding,  337;  through 
shop  committees,  288.  See  also 
Cooperation  in  industry 

Sheldon,  Justice,  596 

Shingle  Weavers'  Union,  75 

Shipbuilding  Labor  Adjustment  Board, 
administration  of,  311-348 

Shop  committees,  288-310;  in  Hart 
Schaffner  &  Marx  agreement,  539; 
relation  of,  to  unions,  300,  319,  345- 
348;  in  shipbuilding,  318 

Shop  stewards,  303 

Sick  benefits.    See  Benefits 

Sickness,  prevention  of,  85 ;  tax  on,  82 

Sickness  insurance,  British,  45-55;  as 
tax,  81-93;  in  trade-unions,  71-80. 
See  also  Benefits,  Fraternal  bene- 
ficiary societies 

Sidgwick,  Henry,  "  Elements  of  Poli- 
tics," 582,  610 

Singleton,  Benjamin,  negro  leader,  117 

Smith,  Adam,  13,  16;  "Wealth  of 
Nations,"  582 

Snow,  Freeman,  "Cases  on  Interna- 
tional Law,"  592 

Social  welfare.   See  Industrial  welfare 

Socialism,  criticized,  loi ;  in  Russia, 
183,  186,  189-190,  197 

Social-Revolutionists  of  the  Right, 
Russian,  181,  184,  188 

Solidarity,  of  labor,  11,  15;  of  trades, 

362-385 
Sons  of  Vulcan,  363 
South  Carolina,  17 
Soviets.   See  Russian  Soviet  Republic 
Specialization    in    industry,   effect    of, 

on  creative  work,  222,  289 
Spedden,    E.    R.,   "The  Trade   Union 

Label,"  389 
Speek,    P.    W.,    "Autobiographies    of 

Floating  Laborers,"  ix,  94 
Spencer,  Herbert,  582;  "Justice,"  580, 

610;  "Social  Statics,"  606 
Spretson,  N.  E.,  "A  Practical  Treatise 

on  Casting  and  Founding,"  437 
Squires,  B.  M.,  "Operation  of  the  In- 
dustrial  Disputes   Investigation  Act 

of  Canada,"  xiii,  779 
Stabilizing  the  dollar,  need  of,  4,  6 
Standardization,    in   shops    of   Joseph 

and  Feiss,  166 
Stationary  Engineers,  360 


INDEX  OF  SUBJECTS  AND  AUTHORS 


837 


Stecker,  M.  L.,  "The   Founders,  the 
Molders,  and  the  Molding  Machme, 
xi-xii,     433;     "National     Founders 
Association,"    xi-xii,   406  ^ 

Steel     and     Copper     Plate     Prmters 
Union,  75 

Stewards.    See  Shop  stewards 

Stewart,  Ethelbert,  "Equalizmg  Com- 
petitive Conditions,"  xii,  525;  turn- 
over estimates  of,  158 

StUlman,  C.  B.,  360 

Stock-sharing    with    employees,    262, 

264,  267 

Stonecutters'  Union,  75 

Stoppages,  in  Hart  Schaffner  &  Marx 
agreement,  547.    See  also  Cessations 

Stotesbury,  E.  T.,  270 

Stove  Founders'  National  Defense 
Association,  406-407,  409,  4i9>  424> 
428,  456 

Strikes,  as  affected  by  Canadian  Act, 
779-806;  in  anthracite  industry, 
SI";;  assessments  for,  399;  in  Aus- 
tralia, 691 ;  in  bituminous  industry, 
525;  "button,"  516;  constitutional- 
ity of,  656;  development  of,  in 
unions,  340-361 ;  of  molders,  411; 
of  patternmakers,  493 ;  sympathetic, 
362-385 
Structural    Building    Trades    Alliance, 

375,  401 
Suffern,    A.    E.,     "Conciliation     and 
Arbitration  in  the  Coal  Industry," 

Sumner,   H.   L.,    and   Adams,   T.    S., 

"Labor  Problems,"  380 
Swayze,  Justice,  "The  Growing  Law,' 

633 

Swift  and  Company,  turnover  in,  157 

Switchmen's  Union,  369 

Sydenstricker,  Edgar,  "Settlement  of 
Disputes  under  Agreements  in  the 
Anthracite  Industry,"  xii,  495 

Sydenstricker,  Edgar,  and  Lauck,  W. 
J.,  "Conditions  of  Labor  in  Ameri- 
can Industries,"  259 

Sydenstricker,  Edgar,  and  Warren,  B 
S.,  "Health  Insurance,"  i5S 

Sylvis,  W.  H.,  430 

Sympathetic  strikes.   See  Strikes 

Tailors'  Union,  75 

Taney,  Justice,  651 

Taussig,  F.  W.,  "  Investors  and  Money 
Makers,"  629;  "Minimum  Wages 
for  Women,"  xii,  714;  "Principles  of 
Economics,"  721 


Tawney,  R.  H.,  "Minimum  Rates  in 
the  Tailoring  Industry,"  631 

Tax  on  accidents,  81 

Tax  on  sickness,  82 

Tax  on  unemployment,  10 

Taxation,  in  American  Federation  of 
Labor  program,  572 

Taxes,  collection  of,  in  Russia,  187 

Taylor,  F.  W.,  10;  on  differential  rates, 
200,  203,  204;  on  scientific  manage- 
ment, X,  141-149 

Taylor,  F.  W.,  and  Alifas,  N.  P., 
"Scientific  Shop  Management,"  141 

Taylor,  Hannis,  "Science  of  Jurispru- 
dence," 570 
Teachers,  unions  of,  359 
Texas,   minimum    wage   in,   746,    750- 
752,  777;  workingmen's  insurance  in, 
20 
Thayer,  E.  R.,  "  Legal  Essays,"  623 

Thiel,  C,  359 

Thompson,  W\  O.,  536 

Time  studies,  difficulties  of,  208;  evils 
of,  145;  value  of,  211 

Tobacco  Workers'  Union,  74,  75 

Trade-unions.    See  Labor  unions 

Travelers'  Goods  and  Leather  Novelty 
Workers'  Union,  75 

Treiber,E.,  "  Foundry  Machinery,"  437 

Trotsky,  Leon,  170 

Tuberculosis,  in  Framingham,  88 ;  pre- 
vention of,  89 

Turnover  of  labor,  x,  150-164;  causes 
of,  127;  cost  of,  135;  in  Joseph  and 
Feiss  Company,  163-164,  177;  effects 
of  profit-sharing  on,  260,  269;  in 
shipbuilding,  332 

Typographical    Association    (English), 

300 
Typographical    Union,    International, 
ix,  367,  377,  386,  300,  301,  392;  sick 
benefits  of,  74,  76;  split  in,  362,  368, 
37^,  380 

Unemployment,  125-140;  m  American 

Fedfrat'on.  of  .Labor  prog'-am,  563; 

ciuses  of,  108-  cbssincatior  of,  106, 

loS;    elirainauon    m,   profitable,   9; 

insurance  against,  56-70;  tax  on,  10 
Union  P-intcrs'  Home,  "^4 
Union  Printers'  l^.Iutud  Aid  Society,  76 
Unionc.   Se3  Labor  unions 
United  associations  and  brotherhoods. 

5^^  name  of  trade 
United  Mine  Workers  of  America,  363, 

377,   405-406,    408,    500,    516,    524, 

525,  530,  660,  664,  709 


*t*< 


838       TRADE  UNIONISM  AND  LABOR  PROBLEMS 


United  States  Bureau  of  Labor  Statis- 
tics, "Effect  of  Workmen's  Com- 
pensation Laws  in  Diminishing  the 
Necessity  of  Industrial  Employment 
of  Women  and  Children,"  27 
United  States  Bureau  of  Mines,  29 
United  States  Geological  Survey,  514- 

515 
United     States     Industrial     Relations 

Commission,  q4 

United  States  Steel  Corporation,  Bol- 
shevistic propaganda  of,  2 ;  against 
eight-hour  day,  814;  records  of,  31 

University  of  Wisconsin,  medical 
supervision  in,  8g 

Usury,  600 

Utah,  minimum  wage  in,  746,  747,  752 

Van  Devanter,  Justice,  636 

Mrginia,  37 

Vocational    education,    need    of,    233. 

See  also  Factory  schools,  Industrial 

education 

Wages,  adjustments  of,  231 ;  in  Ameri- 
can Federation  of  Labor  program, 
564;  arbitration  regarding,  6Q4-713; 
in  Hart  Schaffner  &  Marx  agreement, 
553;  of  Joseph  and  Feiss  Company, 
178;  methods  of  payment  of,  205; 
of  miners,  3 ;  of  patternmakers,  402 ; 
in  printing  industry,  5 ;  of  Philadel- 
phia Rapid  Transit  Company,  274; 
under  scientific  management,  147;  in 
shipbuilding,  311,  322 

Walker,  F.  A.,  725 

War  Labor  Board,  272,  274 

Ward,  L.  F.,  "Applied  Sociology,"  .^70 

Warne,  F.  J.,  "Trade  Agreement  in  the 
Coal  Industry,"  498 

W"arren,  B.  S.,  and  Sydenstricker, 
Edgar.  "Health  Insurance,"  1.55  , 

Washingl(!.n,'mi.nrmUm  wage  irj,  V38- 
778;  vvorkirtgrnen's  insurr.nte  .in,' 
17-44 

Washington,  Dr.  B.  T.,  on  - migratiok 
of  negroes,  115  [       •    .  •   t  * ' 

Webb,  Sidney  an<i  B'eatrice,  M2,i7i7s' 
"History  of  Trade  Unionism,"  349; 
"Industrial    Democracy,'*'    696,  -697> 
708  •   ,       -' 

Weinstein,  S.  B.,  "Oregon  Minimum 
Wage  Law,"  768-769 

Weinstock,  Harris,  485-486 

Welfare.    iSee  Industrial  welfare 

Werner.  Justice,  613 

West,  T.  D.,  435 


West  Virginia,  20,  22,  31,  39 

Western  Federation  of  Miners,  75,  363, 

377,  394 

Wheaton,  G.  S.,  356,  581 

White,  Chief  Justice,  620,  636 

White  Motor  Company,  11 

White  Rats  Actors'  Union,  75 

Wigmore,  J.  H.,  "The  Qualities  of 
Current  Judicial  Decisions,"  632 

Willetts,  J.  H.,  "Development  of  Em- 
ployment Managers'  Associations," 
163;  "Steady  Employment,"  157 

Williams,  J.  C,  "The  Reduction  of  the 
Turnover  of  t'ne  Plimpton  Press,''  157 

Williams,  J.  E.,  534,  536 

Williams,  J.  M.,  "An  Actual  .\ccount 
of  what  we  have  done  to  Reduce 
our  Labor  Turnover,"  160 

WUloughbv,  W.  W.,'"  Political  Theories 
of  the  Ancient  World,"  584 

Window-Glass  Workers'  Union,  362 

Wire  Weavers'  Union,  75 

Wisconsin,  minimum  wage  in,  738- 
778;  workingmen's  insurance  in, 
17-44 

Wolf,  R.  B.,  "  Nonfinancial  Incentives," 
xi,  218 

Wolfe,  F.  E.,  "Admission  to  American 
Trade  Unions,"  389 

Wolfe,  F.  E.,  and  Douglas,  P.  H., 
"Labor  Administration  in  the  Ship- 
building Industry  during  W^ar 
Time,"  xi,  311 

Wolman,  Leo,  "Collective  Bargaining 
in  the  Glass- Bottle  Industry,"  xii, 
458;  "The  Extent  of  Labor  Organ- 
izations in  the  United  States,"  436 

Women,  in  American  Federation  of 
Labor  prog'ram,  565 ;  hours  of  labor 
of,  615;  rights  of,  600-601 

Wood  Workers'  Union,  74 

Workers'  Union,  70 

•  Workingmen's  insurance,  17-44;  com- 
pulsory, 20;  constitutionality  of, 
20-21;  humane  aspect  of,  40-41; 
optional,  20;  states  having,  17;  un- 

■    organized  workers  benefited  by,  80 

Workshop  committees.   See  Shop  com- 
mittees 
Wright,  C.  D.,  "Practical  Sociology," 

512,  520-521,  579,  588 
Wyoming,  20 

Yates,  W.  F.,  352 

Zeller,  Eduard,  "Aristotle  and  the 
Earlier  Peripatetics,"  584 


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